EC approves exchange

Europe

The European Commission has ruled that Inreon, the online reinsurance trading exchange funded by the two largest reinsurers in the world, did not currently constitute a monopoly. Indeed, the EC felt that neutral exchanges such as Inreon were more likely to encourage competition than to stifle it. Besides Munich Re and Swiss Re, the other investors in the venture are Accenture and the Internet Capital Group. The Commission was previously concerned that the platform might be used by its members to exchange market sensitive information, exclude competitors from the market or to form cartels. The Commission declared itself satisfied that Inreon’s admission criteria were clear, objective, and non-discriminatory. Members were free to join other online exchanges. The possibility of manipulating the market through members joining forces against competitors were reduced as reinsurers could not see rivals’ quotes. Similarly, primary insurers could not see what business was being submitted by other insurers.