Commission option three appears favoured by stakeholders

It has been little over a month since the Commission released its eagerly anticipated road map setting out possible options to deal with the potentially complex consequences of the Vnuk decision. Although setting out four options, the road map which is entitled ‘Adaptation of the scope of Directive 2009/103/EC on motor insurance’ seems to lean in favour of a modest but important change to the Sixth European Motor Insurance Directive (MID). This is the third of four options identified by the Commission.

Since publication of the road map, we have held two well-attended meetings with insurer customers and stakeholders from the motor sport industry to consider views, share opinions and outline next steps. There was, as one would expect, some speculation at the meetings about how the workings out of the UK’s decision to leave the European Union might affect both the current handling and ultimate resolution of the Vnuk dossier. Nonetheless and in line with our preliminary thinking, option three – amending the MID to limit the need for compulsory motor insurance to the use of vehicles in traffic – looked very much to be the preferred choice.

Of course, there is uncertainty about what the exact wording of the proposed amendment to the MID would be. The Commission suggests that use of a vehicle in traffic could be defined as the transport of persons or goods, whether stationary or in motion, in areas where the public has access in accordance with national law. The present wording of the Road Traffic Act 1988 requires cover for use on “a road or other public place”. Quite how this phrase fits with the Commission’s suggested definition will dictate the scope of any amended required to the RTA once the positon at EU level has been confirmed.

As to timelines for amending the MID, it would seem that by summer 2017 is a possibility, but deadlines on Vnuk have slipped before … and there is some irony, perhaps, in the road map’s statement, nearly two years after the case, that “a swift response at EU level is warranted.”

One outcome we are keen to avoid for the post-Vnuk amendment being caught in the wider REFIT exercise (see, for example our December 2015 post about REFIT here). However, if this does get caught up with REFIT there could be considerable delay.

The immediate next step seems to be for the Commission to confirm its preferred option following the road map’s publication. It has set out Q3 2016 as its target date. We, like many others, await developments with interest.

Portrait photograph of Alistair Kinley, Director of Policy & Government Affairs

Alistair Kinley is director of policy and government affairs at BLM.

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