The right of an insurer located in one European Economic Area (EEA) member state to underwrite a risk located in another EEA member state by establishing a permanent presence in that EEA member state. (Please see the ‘Definition of risk location’ section on Crystal for clarification of the correct location for a risk.) This permanent presence can be in the form of a local branch, agency or subsidiary. At Lloyd’s, a permanent presence in another EEA member state is created by having local coverholders with full binding authority agreements and a local Lloyd’s General Representative. (A full binding authority agreement is one where the coverholder may enter into contracts of insurance without first consulting the syndicate.) Freedom of establishment business is that underwritten under a full binding authority where the coverholder and the risk are located in the same EEA member state outside the UK.
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UK: The right to set up a branch, subsidiary office or similar establishment to transact business in a foreign country.
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The right to set up an office or establishment in a country other than that in which one has one’s principal place of business.