Following the European Commission’s request for advice, EIOPA launched a consultation on good practices on individual transfer of supplementary occupational pension rights in January 2015. As a result, EIOPA identified eight main problematic issues with cross-border transfers and set out 14 ‘good practices’ to solve them. These included allowing transfers to remain at the discretion of schemes covering as much second-pillar savings as possible and harmonised requirements for domestic and cross-border transfers, set timeframes, limited member involvement and objective criteria for rejecting transfers.
Pensions industry urged European Insurance and Occupational Pensions Authority (EIOPA) to create differences in its proposal to the European Commission on pensions transfers across the EU.
PensionsEurope emphasised the importance of not mixing workplace and personal pension systems and urged that before tackling the complex cross-border implications, EIOPA and the European Commission should first focus on ensuring that domestic transfers could take place as the “transfers between workplace pension schemes and personal pension schemes are often, even domestically, not possible due to the different tax arrangements and the different setup of a scheme”. The organisation also drew attention to the fact that good practices on the calculation of transfer value and taxation were missing from the consultation, whereas these could be important obstacles to the practice of transfers.
Actuarial Association of Europe (AAE) welcomed the fact that EIOPA treated the transfers as a choice and a not a requirement for members as the organisation would like to avoid small defined contribution (DC) accounts should be forced to transfer.
BETTER FINANCE’s response to EIOPA Consultation Paper on a Report on Good Practices on individual transfers of supplementary occupational pension rights is available here.
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