1- The Company may accept the reinsurance business from insurance companies operating in the State or from abroad in accordance with the conditions stipulated in this chapter.

2. The accepted businesses shall be of the types and classes of insurance which it is licensed to practice in direct insurance.

3. The premiums of treaty and facultative reinsurance accepted by the insurance company inside and outside the State shall not exceed 49% (forty-nine percent) of the total underwritten premiums by the Company.

4. Exception from Sub-Article (3) of this Article, the Director General may issue a decision to allow exceeding the percentage stated in the said Sub-Article,according to the following conditions:

A. The extent of technical balance to the Company’s portfolio.

B. Assessing the soundness of the Company’s financial position.

C. The extent of the Company meeting its obligations in terms of insurance and reinsurance.

5. The foreign insurance companies licensed and registered to operate in thestate, which transact the reinsurance business, are subject to this article.

The following are conditional upon acceptance of the facultative reinsurance business:

1. The Accepted liabilities shall be either within the Company's retention or exceeding it. In the latter case, the Company must have a reinsurance treaty that protects the surplus liability and the treaty shall contain a provision that allows the company to accept the facultative reinsurance operations within the determined limits.

2. If the Company intends to cover the surplus liability in whole or in part with the facultative reinsurance with another reinsurer, in this case it shall obtain the prior approval of the ceding company.

1. In order to accept the treaty reinsurance business, the insurance company established in the State is required to obtain approval from the Director General. In order to attain the approval, the company shall satisfy the following requisites:

   A. The company’s Articles of Association should contain a condition authorizing the company to accept Reinsurance operations.

B. The minimum subscribed and paid up capital of the Company should not beless than 350,000,000 (three hundred and fifty million dirhams).

C. The company shall submit to the Authority through Electronic Means or othermeans adopted by the Authority an endorsement request (addition of practicing the activity of accepting treaty reinsurance business) and issuance of the Director General’s decision to approve the request after submitting the following documents and information:

1. A certificate supports that the company will practice this activity in the same types and classes of insurance it is licensed to practice.
2. Feasibility study.
3. A business plan relating to its policy of accepting treaty reinsurance operations that deals with the matters stipulated in terms from (1) to (7) and Sub-Article (11) of Article (13) of the Instructions herein.
4. A study on the financial position of the company and the volumes of its free reserves and whether these reserves qualify it to subscribe in the treaty reinsurance operations locally, regionally or internationally, accompanied by an actuary report indicating the company’s adequacy of the technical provisions, the financial solvency, the minimum capital, and the extent of the company compliance in implementing the financial instructions issued by the Authority.
5. The existence of a specific classification of the company pursuant to the provisions of Article (18) of these regulations.
6. A report on how the Company will protect its accepted liabilities, including the Retrocession program.
7. The company shall have the technical and legal staff specializing in reinsurance at the local, regional and international levels.

2. The branch of the foreign insurance company licensed and registered with the Authority may accept the treaty reinsurance operations both inside and outside the State within the terms and conditions contained in these regulations and in particular the terms and conditions stipulated in this chapter.