56-11-104. Acquisitions resulting in change in control of insurer.
(a) Definitions. As used in this section only:
(1) Acquisition means any agreement, arrangement or activity, the consummation of which results in a person acquiring directly or indirectly the control of another person, and includes, but is not limited to, the acquisition of voting securities, the acquisition of assets, bulk reinsurance and mergers; and
(2) Involved insurer includes an insurer that either acquires or is acquired, is affiliated with an acquirer or acquired, or is the result of a merger.
(b) Scope.
(1) Except as exempted in subdivision (b)(2), this section applies to any acquisition in which there is a change in control of an insurer authorized to do business in this state.
(2) This section does not apply to the following:
(A) An acquisition subject to approval or disapproval by the commissioner pursuant to § 56-11-103;
(B) A purchase of securities solely for investment purposes so long as the securities are not used by voting or otherwise to cause or attempt to cause the substantial lessening of competition in any insurance market in this state. If a purchase of securities results in a presumption of control under § 56-11-101(b)(3), it is not solely for investment purposes unless the commissioner of insurance of the insurer's state of domicile accepts a disclaimer of control or affirmatively finds that control does not exist and the disclaimer action or affirmative finding is communicated by the domiciliary commissioner to the commissioner of commerce and insurance of this state;
(C) The acquisition of a person by another person when both persons are neither directly nor through affiliates primarily engaged in the business of insurance, if pre-acquisition notification is filed with the commissioner of commerce and insurance in accordance with subdivision (c)(1) thirty (30) days prior to the proposed effective date of the acquisition. However, the pre-acquisition notification is not required for exclusion from this section if the acquisition would otherwise be excluded from this section by any other subdivision of this subdivision (b)(2);
(D) The acquisition of already affiliated persons;
(E) An acquisition if, as an immediate result of the acquisition:
(i) In no market would the combined market share of the involved insurers exceed five percent (5%) of the total market;
(ii) There would be no increase in any market share; or
(iii) In no market would the combined market share of the involved insurers exceed twelve percent (12%) of the total market, and the market share increases by more than two percent (2%) of the total market. For the purpose of this subdivision (b)(2)(E), market means direct written insurance premium in this state for a line of business as contained in the annual statement required to be filed by insurers licensed to do business in this state;
(F) An acquisition for which a pre-acquisition notification would be required pursuant to this section due solely to the resulting effect on the ocean marine insurance line of business; or
(G) An acquisition of an insurer whose domiciliary commissioner affirmatively finds that the insurer is in failing condition; there is a lack of feasible alternative to improving the condition; the public benefits of improving the insurer's condition through the acquisition exceed the public benefits that would arise from not lessening competition; and the findings are communicated by the domiciliary commissioner of insurance to the commissioner of commerce and insurance of this state.
(c) Pre-acquisition Notification, Waiting Period. An acquisition covered by subsection (b) may be subject to an order pursuant to subsection (e) unless the acquiring person files a pre-acquisition notification and the waiting period has expired. The acquired person may file a pre-acquisition notification. The commissioner of commerce and insurance shall give confidential treatment to information submitted under this subsection (c) in the same manner as provided in § 56-11-108.
(1) The pre-acquisition notification shall be in the form and contain the information as prescribed by the National Association of Insurance Commissioners relating to those markets that, under subdivision (b)(2)(E), cause the acquisition not to be exempted from the provisions of this section. The commissioner may require additional material and information deemed necessary to determine whether the proposed acquisition, if consummated, would violate the competitive standard of subsection (d). The required information may include an opinion of an economist as to the competitive impact of the acquisition in this state accompanied by a summary of the education and experience of the person indicating the person's ability to render an informed opinion.
(2) The waiting period required shall begin on the date of receipt of the commissioner of a pre-acquisition notification and shall end on the earlier of the thirtieth day after the date of the receipt, or termination of the waiting period by the commissioner. Prior to the end of the waiting period, the commissioner, on a one-time basis, may require the submission of additional needed information relevant to the proposed acquisition, in which event the waiting period shall end on the earlier of the thirtieth day after receipt of the additional information by the commissioner, or termination of the waiting period by the commissioner.
(d) Competitive Standard.
(1) The commissioner may enter an order under subdivision (e)(1) with respect to an acquisition if there is substantial evidence that the effect of the acquisition may be substantially to lessen competition in any line of insurance in this state or tend to create a monopoly therein, or if the insurer fails to file adequate information in compliance with subsection (c).
(2) In determining whether a proposed acquisition would violate the competitive standard of subdivision (d)(1), the commissioner shall consider the following:
(A) Any acquisition covered under subsection (b) involving two (2) or more insurers competing in the same market is prima facie evidence of violation of the competitive standards:
(i) If the market is highly concentrated and the involved insurers possess the following shares of the market:
Click to view table.
(ii) If the market is not highly concentrated and the involved insurers possess the following shares of the market:
Click to view table.
A highly concentrated market is one in which the share of the four (4) largest insurers is seventy-five percent (75%) or more of the market. Percentages not shown in the tables are interpolated proportionately to the percentages that are shown. If more than two (2) insurers are involved, exceeding the total of the two (2) columns in the table is prima facie evidence of violation of the competitive standard in subdivision (d)(1). For the purpose of this subdivision (d)(2)(A), the insurer with the largest share of the market shall be deemed to be Insurer A.
(B) There is a significant trend toward increased concentration when the aggregate market share of any grouping of the largest insurers in the market from the two (2) largest to the eight (8) largest has increased by seven percent (7%) or more of the market over a period of time extending from any base year five (5) to ten (10) years prior to the acquisition up to the time of the acquisition. Any acquisition or merger covered under subsection (b) involving two (2) or more insurers competing in the same market is prima facie evidence of violation of the competitive standard in subdivision (d)(1) if:
(i) There is a significant trend toward increased concentration in the market;
(ii) One (1) of the insurers involved is one (1) of the insurers in a grouping of the large insurers showing the requisite increase in the market share; and
(iii) Another involved insurer's market is two percent (2%) or more.
(C) As used in this subdivision (d)(2):
(i) Insurer includes any company or group of companies under common management, ownership or control;
(ii) Market means the relevant product and geographical markets. In determining the relevant product and geographical markets, the commissioner shall give due consideration to, among other things, the definitions or guidelines, if any, promulgated by the National Association of Insurance Commissioners and to information, if any, submitted by parties to the acquisition. In the absence of sufficient information to the contrary, the relevant product market is assumed to be the direct written insurance premium for a line of business, the line being that used in the annual statement required to be filed by insurers doing business in this state and the relevant geographical market is assumed to be this state; and
(iii) The burden of showing prima facie evidence of violation of the competitive standard rests upon the commissioner.
(D) Even though an acquisition is not prima facie violative of the competitive standard under subdivisions (d)(2)(A) and (B), the commissioner may establish the requisite anticompetitive effect based upon other substantial evidence. Even though an acquisition is prima facie violative of the competitive standard under subdivisions (d)(2)(A) and (B), a party may establish the absence of the requisite anticompetitive effect based upon other substantial evidence. Relevant factors in making a determination under this subdivision (d)(2)(D) include, but are not limited to, the following: market shares, volatility of ranking of market leaders, number of competitors, concentration, trend of concentration in the industry, and ease of entry and exit into the market.
(3) An order may not be entered under subdivision (e)(1) if:
(A) The acquisition will yield substantial economies of scale or economies in resource utilization that cannot be feasibly achieved in any other way, and the public benefits that would arise from the economies exceed the public benefits that would arise from not lessening competition; or
(B) The acquisition will substantially increase the availability of insurance, and the public benefits of the increase exceed the public benefits that would arise from not lessening competition.
(e) Orders and Penalties.
(1) If an acquisition violates the standards of this section, the commissioner may enter an order requiring an involved insurer to cease and desist from doing business in this state with respect to the line or lines of insurance involved in the violation.
(2) The commissioner may also issue an order denying the application of an acquired or acquiring insurer for a license to do business in this state.
(3) This order shall not be entered unless there is a hearing, notice of the hearing is issued prior to the end of the waiting period and not less than fifteen (15) days prior to the hearing, and the hearing is concluded and the order is issued no later than sixty (60) days after the end of the waiting period. Every order shall be accompanied by a written decision of the commissioner setting forth the commissioner's findings of fact and conclusions of law.
(4) An order entered under this subsection (e) shall not become final earlier than thirty (30) days after it is issued, during which time the involved insurer may submit a plan to remedy the anticompetitive impact of the acquisition within a reasonable time. Based upon the plan or other information, the commissioner shall specify the conditions, if any, under the time period during which the aspects of the acquisition causing a violation of the standards of this section would be remedied and the order vacated or modified.
(5) An order pursuant to this subsection (e) shall not apply if the acquisition is not consummated.
(6) Any person who violates a cease and desist order of the commissioner under this section and while the order is in effect may, after notice and hearing, and upon order of the commissioner, be subject at the discretion of the commissioner to any one (1) or more of the following:
(A) A monetary penalty of not more than ten thousand dollars ($10,000) for every day of violation; and/or
(B) Suspension or revocation of the person's license.
(7) Any insurer or other person who fails to make any filing required by this section and who also fails to demonstrate a good faith effort to comply with this filing requirement shall be subject to a fine of not more than fifty thousand dollars ($50,000).
(f) Inapplicable Provisions. Sections 56-11-110(b) and (c) and 56-11-112 do not apply to acquisitions covered under subsection (b).
56-11-104. Acquisitions resulting in change in control of insurer.
(a) Definitions. As used in this section only:
(1) Acquisition means any agreement, arrangement or activity, the consummation of which results in a person acquiring directly or indirectly the control of another person, and includes, but is not limited to, the acquisition of voting securities, the acquisition of assets, bulk reinsurance and mergers; and
(2) Involved insurer includes an insurer that either acquires or is acquired, is affiliated with an acquirer or acquired, or is the result of a merger.
(b) Scope.
(1) Except as exempted in subdivision (b)(2), this section applies to any acquisition in which there is a change in control of an insurer authorized to do business in this state.
(2) This section does not apply to the following:
(A) An acquisition subject to approval or disapproval by the commissioner pursuant to § 56-11-103;
(B) A purchase of securities solely for investment purposes so long as the securities are not used by voting or otherwise to cause or attempt to cause the substantial lessening of competition in any insurance market in this state. If a purchase of securities results in a presumption of control under § 56-11-101(b)(3), it is not solely for investment purposes unless the commissioner of insurance of the insurer's state of domicile accepts a disclaimer of control or affirmatively finds that control does not exist and the disclaimer action or affirmative finding is communicated by the domiciliary commissioner to the commissioner of commerce and insurance of this state;
(C) The acquisition of a person by another person when both persons are neither directly nor through affiliates primarily engaged in the business of insurance, if pre-acquisition notification is filed with the commissioner of commerce and insurance in accordance with subdivision (c)(1) thirty (30) days prior to the proposed effective date of the acquisition. However, the pre-acquisition notification is not required for exclusion from this section if the acquisition would otherwise be excluded from this section by any other subdivision of this subdivision (b)(2);
(D) The acquisition of already affiliated persons;
(E) An acquisition if, as an immediate result of the acquisition:
(i) In no market would the combined market share of the involved insurers exceed five percent (5%) of the total market;
(ii) There would be no increase in any market share; or
(iii) In no market would the combined market share of the involved insurers exceed twelve percent (12%) of the total market, and the market share increases by more than two percent (2%) of the total market. For the purpose of this subdivision (b)(2)(E), market means direct written insurance premium in this state for a line of business as contained in the annual statement required to be filed by insurers licensed to do business in this state;
(F) An acquisition for which a pre-acquisition notification would be required pursuant to this section due solely to the resulting effect on the ocean marine insurance line of business; or
(G) An acquisition of an insurer whose domiciliary commissioner affirmatively finds that the insurer is in failing condition; there is a lack of feasible alternative to improving the condition; the public benefits of improving the insurer's condition through the acquisition exceed the public benefits that would arise from not lessening competition; and the findings are communicated by the domiciliary commissioner of insurance to the commissioner of commerce and insurance of this state.
(c) Pre-acquisition Notification, Waiting Period. An acquisition covered by subsection (b) may be subject to an order pursuant to subsection (e) unless the acquiring person files a pre-acquisition notification and the waiting period has expired. The acquired person may file a pre-acquisition notification. The commissioner of commerce and insurance shall give confidential treatment to information submitted under this subsection (c) in the same manner as provided in § 56-11-108.
(1) The pre-acquisition notification shall be in the form and contain the information as prescribed by the National Association of Insurance Commissioners relating to those markets that, under subdivision (b)(2)(E), cause the acquisition not to be exempted from the provisions of this section. The commissioner may require additional material and information deemed necessary to determine whether the proposed acquisition, if consummated, would violate the competitive standard of subsection (d). The required information may include an opinion of an economist as to the competitive impact of the acquisition in this state accompanied by a summary of the education and experience of the person indicating the person's ability to render an informed opinion.
(2) The waiting period required shall begin on the date of receipt of the commissioner of a pre-acquisition notification and shall end on the earlier of the thirtieth day after the date of the receipt, or termination of the waiting period by the commissioner. Prior to the end of the waiting period, the commissioner, on a one-time basis, may require the submission of additional needed information relevant to the proposed acquisition, in which event the waiting period shall end on the earlier of the thirtieth day after receipt of the additional information by the commissioner, or termination of the waiting period by the commissioner.
(d) Competitive Standard.
(1) The commissioner may enter an order under subdivision (e)(1) with respect to an acquisition if there is substantial evidence that the effect of the acquisition may be substantially to lessen competition in any line of insurance in this state or tend to create a monopoly therein, or if the insurer fails to file adequate information in compliance with subsection (c).
(2) In determining whether a proposed acquisition would violate the competitive standard of subdivision (d)(1), the commissioner shall consider the following:
(A) Any acquisition covered under subsection (b) involving two (2) or more insurers competing in the same market is prima facie evidence of violation of the competitive standards:
(i) If the market is highly concentrated and the involved insurers possess the following shares of the market:
Click to view table.
(ii) If the market is not highly concentrated and the involved insurers possess the following shares of the market:
Click to view table.
A highly concentrated market is one in which the share of the four (4) largest insurers is seventy-five percent (75%) or more of the market. Percentages not shown in the tables are interpolated proportionately to the percentages that are shown. If more than two (2) insurers are involved, exceeding the total of the two (2) columns in the table is prima facie evidence of violation of the competitive standard in subdivision (d)(1). For the purpose of this subdivision (d)(2)(A), the insurer with the largest share of the market shall be deemed to be Insurer A.
(B) There is a significant trend toward increased concentration when the aggregate market share of any grouping of the largest insurers in the market from the two (2) largest to the eight (8) largest has increased by seven percent (7%) or more of the market over a period of time extending from any base year five (5) to ten (10) years prior to the acquisition up to the time of the acquisition. Any acquisition or merger covered under subsection (b) involving two (2) or more insurers competing in the same market is prima facie evidence of violation of the competitive standard in subdivision (d)(1) if:
(i) There is a significant trend toward increased concentration in the market;
(ii) One (1) of the insurers involved is one (1) of the insurers in a grouping of the large insurers showing the requisite increase in the market share; and
(iii) Another involved insurer's market is two percent (2%) or more.
(C) As used in this subdivision (d)(2):
(i) Insurer includes any company or group of companies under common management, ownership or control;
(ii) Market means the relevant product and geographical markets. In determining the relevant product and geographical markets, the commissioner shall give due consideration to, among other things, the definitions or guidelines, if any, promulgated by the National Association of Insurance Commissioners and to information, if any, submitted by parties to the acquisition. In the absence of sufficient information to the contrary, the relevant product market is assumed to be the direct written insurance premium for a line of business, the line being that used in the annual statement required to be filed by insurers doing business in this state and the relevant geographical market is assumed to be this state; and
(iii) The burden of showing prima facie evidence of violation of the competitive standard rests upon the commissioner.
(D) Even though an acquisition is not prima facie violative of the competitive standard under subdivisions (d)(2)(A) and (B), the commissioner may establish the requisite anticompetitive effect based upon other substantial evidence. Even though an acquisition is prima facie violative of the competitive standard under subdivisions (d)(2)(A) and (B), a party may establish the absence of the requisite anticompetitive effect based upon other substantial evidence. Relevant factors in making a determination under this subdivision (d)(2)(D) include, but are not limited to, the following: market shares, volatility of ranking of market leaders, number of competitors, concentration, trend of concentration in the industry, and ease of entry and exit into the market.
(3) An order may not be entered under subdivision (e)(1) if:
(A) The acquisition will yield substantial economies of scale or economies in resource utilization that cannot be feasibly achieved in any other way, and the public benefits that would arise from the economies exceed the public benefits that would arise from not lessening competition; or
(B) The acquisition will substantially increase the availability of insurance, and the public benefits of the increase exceed the public benefits that would arise from not lessening competition.
(e) Orders and Penalties.
(1) If an acquisition violates the standards of this section, the commissioner may enter an order requiring an involved insurer to cease and desist from doing business in this state with respect to the line or lines of insurance involved in the violation.
(2) The commissioner may also issue an order denying the application of an acquired or acquiring insurer for a license to do business in this state.
(3) This order shall not be entered unless there is a hearing, notice of the hearing is issued prior to the end of the waiting period and not less than fifteen (15) days prior to the hearing, and the hearing is concluded and the order is issued no later than sixty (60) days after the end of the waiting period. Every order shall be accompanied by a written decision of the commissioner setting forth the commissioner's findings of fact and conclusions of law.
(4) An order entered under this subsection (e) shall not become final earlier than thirty (30) days after it is issued, during which time the involved insurer may submit a plan to remedy the anticompetitive impact of the acquisition within a reasonable time. Based upon the plan or other information, the commissioner shall specify the conditions, if any, under the time period during which the aspects of the acquisition causing a violation of the standards of this section would be remedied and the order vacated or modified.
(5) An order pursuant to this subsection (e) shall not apply if the acquisition is not consummated.
(6) Any person who violates a cease and desist order of the commissioner under this section and while the order is in effect may, after notice and hearing, and upon order of the commissioner, be subject at the discretion of the commissioner to any one (1) or more of the following:
(A) A monetary penalty of not more than ten thousand dollars ($10,000) for every day of violation; and/or
(B) Suspension or revocation of the person's license.
(7) Any insurer or other person who fails to make any filing required by this section and who also fails to demonstrate a good faith effort to comply with this filing requirement shall be subject to a fine of not more than fifty thousand dollars ($50,000).
(f) Inapplicable Provisions. Sections 56-11-110(b) and (c) and 56-11-112 do not apply to acquisitions covered under subsection (b).
56-11-104. Acquisitions resulting in change in control of insurer.
(a) Definitions. As used in this section only:
(1) Acquisition means any agreement, arrangement or activity, the consummation of which results in a person acquiring directly or indirectly the control of another person, and includes, but is not limited to, the acquisition of voting securities, the acquisition of assets, bulk reinsurance and mergers; and
(2) Involved insurer includes an insurer that either acquires or is acquired, is affiliated with an acquirer or acquired, or is the result of a merger.
(b) Scope.
(1) Except as exempted in subdivision (b)(2), this section applies to any acquisition in which there is a change in control of an insurer authorized to do business in this state.
(2) This section does not apply to the following:
(A) An acquisition subject to approval or disapproval by the commissioner pursuant to § 56-11-103;
(B) A purchase of securities solely for investment purposes so long as the securities are not used by voting or otherwise to cause or attempt to cause the substantial lessening of competition in any insurance market in this state. If a purchase of securities results in a presumption of control under § 56-11-101(b)(3), it is not solely for investment purposes unless the commissioner of insurance of the insurer's state of domicile accepts a disclaimer of control or affirmatively finds that control does not exist and the disclaimer action or affirmative finding is communicated by the domiciliary commissioner to the commissioner of commerce and insurance of this state;
(C) The acquisition of a person by another person when both persons are neither directly nor through affiliates primarily engaged in the business of insurance, if pre-acquisition notification is filed with the commissioner of commerce and insurance in accordance with subdivision (c)(1) thirty (30) days prior to the proposed effective date of the acquisition. However, the pre-acquisition notification is not required for exclusion from this section if the acquisition would otherwise be excluded from this section by any other subdivision of this subdivision (b)(2);
(D) The acquisition of already affiliated persons;
(E) An acquisition if, as an immediate result of the acquisition:
(i) In no market would the combined market share of the involved insurers exceed five percent (5%) of the total market;
(ii) There would be no increase in any market share; or
(iii) In no market would the combined market share of the involved insurers exceed twelve percent (12%) of the total market, and the market share increases by more than two percent (2%) of the total market. For the purpose of this subdivision (b)(2)(E), market means direct written insurance premium in this state for a line of business as contained in the annual statement required to be filed by insurers licensed to do business in this state;
(F) An acquisition for which a pre-acquisition notification would be required pursuant to this section due solely to the resulting effect on the ocean marine insurance line of business; or
(G) An acquisition of an insurer whose domiciliary commissioner affirmatively finds that the insurer is in failing condition; there is a lack of feasible alternative to improving the condition; the public benefits of improving the insurer's condition through the acquisition exceed the public benefits that would arise from not lessening competition; and the findings are communicated by the domiciliary commissioner of insurance to the commissioner of commerce and insurance of this state.
(c) Pre-acquisition Notification, Waiting Period. An acquisition covered by subsection (b) may be subject to an order pursuant to subsection (e) unless the acquiring person files a pre-acquisition notification and the waiting period has expired. The acquired person may file a pre-acquisition notification. The commissioner of commerce and insurance shall give confidential treatment to information submitted under this subsection (c) in the same manner as provided in § 56-11-108.
(1) The pre-acquisition notification shall be in the form and contain the information as prescribed by the National Association of Insurance Commissioners relating to those markets that, under subdivision (b)(2)(E), cause the acquisition not to be exempted from the provisions of this section. The commissioner may require additional material and information deemed necessary to determine whether the proposed acquisition, if consummated, would violate the competitive standard of subsection (d). The required information may include an opinion of an economist as to the competitive impact of the acquisition in this state accompanied by a summary of the education and experience of the person indicating the person's ability to render an informed opinion.
(2) The waiting period required shall begin on the date of receipt of the commissioner of a pre-acquisition notification and shall end on the earlier of the thirtieth day after the date of the receipt, or termination of the waiting period by the commissioner. Prior to the end of the waiting period, the commissioner, on a one-time basis, may require the submission of additional needed information relevant to the proposed acquisition, in which event the waiting period shall end on the earlier of the thirtieth day after receipt of the additional information by the commissioner, or termination of the waiting period by the commissioner.
(d) Competitive Standard.
(1) The commissioner may enter an order under subdivision (e)(1) with respect to an acquisition if there is substantial evidence that the effect of the acquisition may be substantially to lessen competition in any line of insurance in this state or tend to create a monopoly therein, or if the insurer fails to file adequate information in compliance with subsection (c).
(2) In determining whether a proposed acquisition would violate the competitive standard of subdivision (d)(1), the commissioner shall consider the following:
(A) Any acquisition covered under subsection (b) involving two (2) or more insurers competing in the same market is prima facie evidence of violation of the competitive standards:
(i) If the market is highly concentrated and the involved insurers possess the following shares of the market:
Click to view table.
(ii) If the market is not highly concentrated and the involved insurers possess the following shares of the market:
Click to view table.
A highly concentrated market is one in which the share of the four (4) largest insurers is seventy-five percent (75%) or more of the market. Percentages not shown in the tables are interpolated proportionately to the percentages that are shown. If more than two (2) insurers are involved, exceeding the total of the two (2) columns in the table is prima facie evidence of violation of the competitive standard in subdivision (d)(1). For the purpose of this subdivision (d)(2)(A), the insurer with the largest share of the market shall be deemed to be Insurer A.
(B) There is a significant trend toward increased concentration when the aggregate market share of any grouping of the largest insurers in the market from the two (2) largest to the eight (8) largest has increased by seven percent (7%) or more of the market over a period of time extending from any base year five (5) to ten (10) years prior to the acquisition up to the time of the acquisition. Any acquisition or merger covered under subsection (b) involving two (2) or more insurers competing in the same market is prima facie evidence of violation of the competitive standard in subdivision (d)(1) if:
(i) There is a significant trend toward increased concentration in the market;
(ii) One (1) of the insurers involved is one (1) of the insurers in a grouping of the large insurers showing the requisite increase in the market share; and
(iii) Another involved insurer's market is two percent (2%) or more.
(C) As used in this subdivision (d)(2):
(i) Insurer includes any company or group of companies under common management, ownership or control;
(ii) Market means the relevant product and geographical markets. In determining the relevant product and geographical markets, the commissioner shall give due consideration to, among other things, the definitions or guidelines, if any, promulgated by the National Association of Insurance Commissioners and to information, if any, submitted by parties to the acquisition. In the absence of sufficient information to the contrary, the relevant product market is assumed to be the direct written insurance premium for a line of business, the line being that used in the annual statement required to be filed by insurers doing business in this state and the relevant geographical market is assumed to be this state; and
(iii) The burden of showing prima facie evidence of violation of the competitive standard rests upon the commissioner.
(D) Even though an acquisition is not prima facie violative of the competitive standard under subdivisions (d)(2)(A) and (B), the commissioner may establish the requisite anticompetitive effect based upon other substantial evidence. Even though an acquisition is prima facie violative of the competitive standard under subdivisions (d)(2)(A) and (B), a party may establish the absence of the requisite anticompetitive effect based upon other substantial evidence. Relevant factors in making a determination under this subdivision (d)(2)(D) include, but are not limited to, the following: market shares, volatility of ranking of market leaders, number of competitors, concentration, trend of concentration in the industry, and ease of entry and exit into the market.
(3) An order may not be entered under subdivision (e)(1) if:
(A) The acquisition will yield substantial economies of scale or economies in resource utilization that cannot be feasibly achieved in any other way, and the public benefits that would arise from the economies exceed the public benefits that would arise from not lessening competition; or
(B) The acquisition will substantially increase the availability of insurance, and the public benefits of the increase exceed the public benefits that would arise from not lessening competition.
(e) Orders and Penalties.
(1) If an acquisition violates the standards of this section, the commissioner may enter an order requiring an involved insurer to cease and desist from doing business in this state with respect to the line or lines of insurance involved in the violation.
(2) The commissioner may also issue an order denying the application of an acquired or acquiring insurer for a license to do business in this state.
(3) This order shall not be entered unless there is a hearing, notice of the hearing is issued prior to the end of the waiting period and not less than fifteen (15) days prior to the hearing, and the hearing is concluded and the order is issued no later than sixty (60) days after the end of the waiting period. Every order shall be accompanied by a written decision of the commissioner setting forth the commissioner's findings of fact and conclusions of law.
(4) An order entered under this subsection (e) shall not become final earlier than thirty (30) days after it is issued, during which time the involved insurer may submit a plan to remedy the anticompetitive impact of the acquisition within a reasonable time. Based upon the plan or other information, the commissioner shall specify the conditions, if any, under the time period during which the aspects of the acquisition causing a violation of the standards of this section would be remedied and the order vacated or modified.
(5) An order pursuant to this subsection (e) shall not apply if the acquisition is not consummated.
(6) Any person who violates a cease and desist order of the commissioner under this section and while the order is in effect may, after notice and hearing, and upon order of the commissioner, be subject at the discretion of the commissioner to any one (1) or more of the following:
(A) A monetary penalty of not more than ten thousand dollars ($10,000) for every day of violation; and/or
(B) Suspension or revocation of the person's license.
(7) Any insurer or other person who fails to make any filing required by this section and who also fails to demonstrate a good faith effort to comply with this filing requirement shall be subject to a fine of not more than fifty thousand dollars ($50,000).
(f) Inapplicable Provisions. Sections 56-11-110(b) and (c) and 56-11-112 do not apply to acquisitions covered under subsection (b).
