US insurers could be hit by a fresh wave of EU regulation as part of the EU's retaliation against new US corporate governance rules.
According to reports, Brussels is threatening to force US companies with insurance operations in Europe to comply with a new law, unless the US authorities exempt EU auditors from the Sarbanes-Oxley Act.
Under the EU rules, regulators in the member countries will be allowed to impose additional requirements on non-EU insurers if they conclude that domestic regulation is not as good as the European regime.
The move is a sign that the EU has opened another front in its fight to win exemption from the Sarbanes-Oxley Act, which was passed in the aftermath of the Enron scandal.
Brussels had previously threatened to retaliate by forcing US auditors to be regulated by European watchdogs.
Alan Beller, director of the US Securities and Exchange Commission (SEC) corporation finance division, said the law would place US firms "at a competitive disadvantage with European-based firms".
