\n\u00b7\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Institutions for occupational retirement provision: an institution, irrespective of its legal form, operating on a funded basis and established separately from any sponsoring undertaking or trade for the purpose of providing retirement benefits in the context of an occupational activity on the basis of an agreement or contract agreed individually or collectively between the employer(s) and employee(s) or their respective representatives, or with self-employed persons, in compliance with the legislation of the home and host Member States, and which carried out activities directly arising from that purpose.<\/p>\n \u00b7\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Pension scheme: a contract, an agreement, a trust deed or rules stipulating which retirement benefits are granted and under which conditions.<\/p>\n \u00b7\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Members: persons whose occupational activities entitles or will entitle them to retirement benefits in accordance with the provisions of a pension scheme.<\/p>\n \u00b7\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Beneficiaries: persons who receive retirement benefits.<\/p>\n \u00b7\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 Sponsoring undertaking: any undertaking or other body, regardless of whether it includes or consists of one or more legal or natural persons, which acts as an employer or in a self-employed capacity or any combination thereof and which pays contributions into an institution for occupational retirement provision.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n <\/p>\n <\/span>IORPS 2016<\/span><\/h3>\nDirective (EU) 2016\/2341 \u2014 activities and supervision of institutions for occupational retirement provision<\/p>\n It sets out minimum harmonisation rules for institutions managing collective retirement schemes for employers on behalf of their employees. EU governments may introduce further measures they consider necessary.<\/p>\n The rules aim to:<\/p>\n ensure occupational pension schemes are financially sound; \ngive greater protection and information to members and beneficiaries; \nremove obstacles to cross-border fund activity; \nencourage long-term and responsible investment. \nThe legislation revises and replaces Directive 2003\/41\/EC, which needed to be updated after the 2008 financial crisis.<\/p>\n <\/span>Key Points<\/span><\/h3>\nEU countries must ensure that occupational pension funds or institutions for occupational retirement provision (IORPs):<\/p>\n are only involved in retirement-benefit activities; \nsafeguard their assets for members and beneficiaries if a partner organisation goes bankrupt; \nare registered and authorised by the relevant national authority, including for cross-border activities; \nhave sufficient funds to cover their financial commitments; \ninvest prudently in the best long-term interest of members and beneficiaries; \noperate an effective governance system that provides sound and prudent management of their activities; \nare run by people with the suitable expertise, qualifications and knowledge; \napply a sound remuneration policy for all employees; \nhave risk management, internal audit and actuarial functions* in place; \nat least every 3 years carry out an internal risk assessment and provide a written statement of their investment policy principles; \ndraw up and publicly disclose annual accounts; \nare subject to prudential supervision on issues such as solvency margins and investment rules.<\/p>\n The relevant national authorities in the EU countries:<\/p>\n must have the resources necessary to exercise the prudential supervision; \nrequire IORPs to have sound administrative, accounting and internal control mechanisms; \nmay impose administrative and other penalties for any breaches of legislation; \nhave the power to review an IORP\u2019s strategies, processes and reporting procedures, obtain internal documents they may require and conduct on-site inspections; \nmay exchange information with each other and monetary authorities without violating professional secrecy conditions. \nIORPs must provide prospective and actual members and beneficiaries with clear, updated and free information. This includes:<\/p>\n details of the IORP itself and members\u2019 rights and obligations; \npension benefit statements containing, for instance, data on contributions paid, a breakdown of costs and the value of the personal scheme; \nadvice on how to obtain supplementary information; \npre-retirement advice on benefit pay-out options. \nDepending on the requirements in question, EU countries may exempt certain funds which operate pension schemes with fewer than 15 or 100 members from certain conditions of the legislation. In the event that a pension fund wishes to provide its services in other EU countries, however, it has to apply all the rules laid down in the directive.<\/p>\n The European Insurance and Occupational Pensions Authority:<\/p>\n helps cooperation between national authorities; \nensures consistent application of EU insurance and occupational pensions legislation. \nThe European Commission must report to the European Parliament and to the Council on the implementation of the legislation by 13 January 2023.<\/p>\n <\/span>Application & Background<\/span><\/h3>\nThe directive entered into force on 12 January 2017. It has to become law in the EU countries by 13 January 2019 and it will apply from the date of national transposition.<\/p>\n Occupational pensions include contributions from employers. They are the \u2018second pillar\u2019 of the pension system. State-based social security pensions are the \u2018first pillar\u2019. The \u2018third pillar\u2019 consists of individuals\u2019 non-compulsory private pension savings.<\/p>\n Under EU rules, funds in one country can manage occupational pension schemes for companies based in another. Pan-EU companies can also have a single pension fund for all their European subsidiaries.<\/p>\n Some 125,000 occupational funds operate across the EU. They hold assets worth \u20ac2.5 trillion on behalf of around 75 million citizens, representing 20% of the EU\u2019s working-age population.<\/p>\n For more information, see:<\/p>\n Revision of the Occupational Pension Funds Directive \u2013 frequently asked questions \u2014 press release (European Commission). \nKEY TERMS<\/p>\n Actuarial functions: defined in Article 48 of Directive 2009\/138\/EC (Solvency II), it covers (i) the coordination and monitoring of technical rules, including methodology, assumptions and data; (ii) reporting; and (iii) supporting the risk-management function.<\/p>\n <\/span>MAIN DOCUMENT<\/span><\/h3>\nDirective (EU) 2016\/2341 of the European Parliament and of the Council of 14 December 2016 on the activities and supervision of institutions for occupational retirement provision (IORPs) (recast) (OJ L 354, 23.12.2016, pp. 37-85)<\/p>\n RELATED DOCUMENTS<\/p>\n Regulation (EU) No 1094\/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), amending Decision No 716\/2009\/EC and repealing Commission Decision 2009\/79\/EC (OJ L 331, 15.12.2010, pp. 48-83)<\/p>\n Successive amendments to Regulation (EU) No 1094\/2010 have been incorporated into the original document. This consolidated version is of documentary value only.<\/p>\n Directive 2003\/41\/EC of the European Parliament and of the Council of 3 June 2003 on the activities and supervision of institutions for occupational retirement provision (OJ L 235, 23.9.2003, pp. 10-21)<\/p>\n <\/span>European Insurance and Occupational Pensions Authority (EIOPA)<\/span><\/h3>\nThe 2008 financial crisis brought to light shortcomings in European Union (EU) financial supervision. Based in Frankfurt, the European Insurance and Occupational Pensions Authority (EIOPA) was created in 2010 to prevent the risks of destabilising the insurance sector.<\/p>\n Regulation (EU) No 1094\/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Insurance and Occupational Pensions Authority), amending Decision No 716\/2009\/EC and repealing Commission Decision 2009\/79\/EC.<\/p>\n It sets up EIOPA, an EU body that supports coordination between national authorities and ensures the consistent application of EU laws for the insurance and occupational pensions sectors in EU countries.<\/p>\n <\/span>Consistent application of law<\/span><\/h3>\nEIOPA draws up regulatory and technical standards that accompany laws adopted by the Council and the European Parliament for insurance companies, financial conglomerates (large financial companies active in various financial sectors), occupational pensions and insurance intermediaries (businesses selling pensions and insurance policies). It also has the power to issue guidelines and recommendations on the application of European law.<\/p>\n <\/span>Market trends<\/span><\/h3>\nEIOPA is tasked with ensuring the stability of insurance markets and the protection of policyholders, pension scheme members and beneficiaries. For instance, it monitors consumer trends and assesses potential risks and vulnerabilities of the markets. Under certain strict conditions, it can temporarily prohibit or restrict financial activities that cause a threat to the stability of the financial system.<\/p>\n <\/span>Breach of law<\/span><\/h3>\nEIOPA has the power to investigate a breach of law by a national authority. This arises when the latter fails to ensure that a financial institution complies with European law.<\/p>\n Within 2 months, EIOPA can issue a recommendation to the national authority. Then the European Commission may issue a formal opinion requiring the authority to take the necessary action to comply with the law. If the national authority\u2019s non-compliance persists, EIOPA may directly address a decision to a financial institution under certain strict conditions. This decision prevails over previous decisions taken by the national authority.<\/p>\n <\/span>European financial supervision<\/span><\/h3>\nEIOPA is part of the European System of Financial Supervision created in 2010, and which comprises three other supervisory organisations:<\/p>\n the supervisory authority in charge of the financial markets, based in Paris (European Securities and Markets Authority); \nthe supervisory authority in charge of the banking sector, based in London (European Banking Authority); \nthe European Systemic Risk Board responsible for the overall oversight of the EU\u2019s financial stability, based in Frankfurt. \nFor more information, see the EIOPA website.<\/p>\n <\/span>Reference<\/span><\/h3>\nAct<\/p>\n Entry into force<\/p>\n Deadline for transposition in the Member States<\/p>\n Official Journal<\/p>\n Regulation (EU) No 1094\/2010<\/p>\n 16.12.2010<\/p>\n -OJ L 331 of 15.12.2010, pp. 48-83<\/p>\n Corrigendum<\/p>\n —<\/p>\n OJ L 54 of 22.2.2014, pp. 23-23<\/p>\n Amending act<\/p>\n Entry into force<\/p>\n Deadline for transposition in the Member States<\/p>\n Official Journal<\/p>\n Directive 2014\/51\/EU<\/p>\n 23.5.2014<\/p>\n 31.3.2015<\/p>\n OJ L 153, 22.5.2014, pp. 1-61<\/p>\n RELATED ACTS<\/p>\n Council Regulation (EU) No 1096\/2010 of 17 November 2010 conferring specific tasks upon the European Central Bank concerning the functioning of the European Systemic Risk Board (Official Journal L 331 of 15.12.2010, pp. 162-164).<\/p>\n Directive 2010\/78\/EU of the European Parliament and of the Council of 24 November 2010 amending Directives 98\/26\/EC, 2002\/87\/EC, 2003\/6\/EC, 2003\/41\/EC, 2003\/71\/EC, 2004\/39\/EC, 2004\/109\/EC, 2005\/60\/EC, 2006\/48\/EC, 2006\/49\/EC and 2009\/65\/EC in respect of the powers of the European Supervisory Authority (European Banking Authority), the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the European Supervisory Authority (European Securities and Markets Authority) (Official Journal L 331 of 15.12.2010, pp. 120-161).<\/p>\n Commission Decision 2004\/9\/EC of 5 November 2003 establishing the European Insurance and Occupational Pensions Committee (Official Journal L 3 of 7.1.2004, pp. 34-35).<\/p>\n\n \n <\/div>\n\n","protected":false},"excerpt":{"rendered":" Institutions for occupational retirement provision With the adoption of the Directive on the activities and supervision of “institutions for occupational retirement provision (IORPs)” , the European Union has moved decisively in the direction of creating an internal market for occupational retirement provision. By clearly setting out how IORPs should function, the Directive ensures a high […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[122],"tags":[],"_links":{"self":[{"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/posts\/17226"}],"collection":[{"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/comments?post=17226"}],"version-history":[{"count":8,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/posts\/17226\/revisions"}],"predecessor-version":[{"id":18513,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/posts\/17226\/revisions\/18513"}],"wp:attachment":[{"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/media?parent=17226"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/categories?post=17226"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/legalblog.ie\/wp-json\/wp\/v2\/tags?post=17226"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}} |