”Cross-border pension issues in the EU”

1. ”Cross-border pension issues in the EU” Ann Devos Member, CEIOPS OPC Warsaw, 18 Sept. 2006

2. Topics • CEIOPS • Work of the OPC • Budapest Protocol • Cross-border issues • Closing remarks Warsaw, 18 September 2006

3. I.Committee of European Insurance and Occupational Pensions Supervisors (CEIOPS)

4. Lamfalussy Approach Level 1: Framework Principles Commission, Council, Parliament Level 2: Decision Making Commission, EIOPC Level 3: Implementation CEIOPS, CEBS, CESR Level 4: Enforcement Commission, Member States Warsaw, 18 September 2006

5. Tasks • L2 activities: advise the Commission on implementation measures and regulations • L3 activities: • establish supervisory standards • forum for supervisory cooperation   enhance effective application of regulations  facilitate cooperation between supervisors  convergence of supervisory practices Warsaw, 18 September 2006

6. European Institutions (Parliament, Council, Commission) Members’ Meeting Managing Board Consultative Panel CEIOPS Secretariat WORKING GROUPS Insurance Groups Supervision Financial Stability Occupational Pensions Insurance Intermediaries Solvency II- Pillar I Solvency II- Pillar II Solvency II- Pillar III/Accounting Solvency II- Groups/Cross-sector Warsaw, 18 September 2006

7. II.Work of the Occupational Pensions Committee (OPC)

8. Occupational PensionsCommittee • permanent Committee • secretariat in Budapest (HFSA) • 24 members + 1 observer • 5meetings a year • attendance of the Commission and Secretariat • feedback to the Members’ Meeting Warsaw, 18 September 2006

9. Working Plan • to support the smooth implementation of the IORP Directive • developing common understanding • developing protocols for supervisory cooperation • coordination and exchange of information on cross-border membership Warsaw, 18 September 2006

10. Working Plan (2) • to monitor the application of the Directive • calculation of technical provisions • application of investment rules • optional application of the Directive • to analyse the regulatory situation of pension savings institutions • toserve as a basis for supervisory convergence Warsaw, 18 September 2006

11. BUDAPEST Protocol a framework for the cooperation of supervisors in the area of cross-border activity

12. Development • first draft  Sept. 2004 • first public consultation  28 Feb. 2005 • comments from 4 organisations • discussed in OPC • second public consultation  28 Oct. 2005 • approval CEIOPS Members’ Meeting  Feb. 2006 Warsaw, 18 September 2006

13. Supervisory Frameworkgeneral picture Home Host pension scheme IORP Sponsor employees Host name Sponsor name Main char. Prudential supervision Social supervision S&L law Info req. Inv. rules Auth. Auth. Warsaw, 18 September 2006

14. ”Open Doors” Approach Home Host CA CA CA CA CA CA CA CA CA CA Warsaw, 18 September 2006

15. Content of the Protocol • general considerations • authorised IORPs and the notification process • ongoing supervision and exchange of information after the notification process • appendices Warsaw, 18 September 2006

16. General Considerations • CEIOPS members, non-CEIOPS competent authorities of EEA States • commitment to cooperate in all cases required under the Directive • aim to harmonise documents • additional cooperation where needed • language used for cooperation Warsaw, 18 September 2006

17. NotificationProcedure • only authorised IORPs can start operating cross-border • such authorisation has to be granted only once • not for each cross-border activity Warsaw, 18 September 2006

18. Ongoing Supervision • dialogue between the authorities • changes inprovided information about the laws, the pension schemes and the IORPs • sharing information about interventions • procedures in case of non-compliance • ring-fencing of the assets and liabilities Warsaw, 18 September 2006

19. step by step … Warsaw, 18 September 2006

20. Ex. : Belgium - Poland pension scheme Belgian IORP Polish undertaking notification główne cechy systemu emerytalnego Belgian supervisor Polish supervisor Warsaw, 18 September 2006

21. Ex. : Belgium - Poland pension scheme Belgian IORP Polish undertaking prawo socjalne i prawo pracy wymogi informacyjne ograniczenia inwestycyjne Belgian supervisor Polish supervisor Warsaw, 18 September 2006

22. Ex. : Belgium - Poland pension scheme Belgian IORP Polish undertaking prudential supervision social supervision info on compliance, interventions, … Belgian supervisor Polish supervisor Warsaw, 18 September 2006

23. Ex. : Poland - Belgium pension scheme Polish IORP Belgian undertaking notification voornaamste kenmerken pensioenregeling Polish supervisor Belgian supervisor Warsaw, 18 September 2006

24. Ex. : Poland - Belgium pension scheme Polish IORP Belgian undertaking sociale en arbeidswetgeving informatievereisten beleggingsregels Polish supervisor Belgian supervisor Warsaw, 18 September 2006

25. Ex. : Poland - Belgium pension scheme Polish IORP Belgian undertaking prudential supervision social supervision info on compliance, interventions, … Polish supervisor Belgian supervisor Warsaw, 18 September 2006

26. Cross-border Issues Trust, convergence, common understanding, exchange of information and experience.

27. Trust in Each Other • host authority relies on home’s judgement about the authorisation and notification • host authority relies on home’s control, except • relevant S&L law • information requirements • host authority relies on home’s measures, except • lack of measures, or • measures, taken against the breach of relevant S&L law, not effective Warsaw, 18 September 2006

28. Supervisory Convergence • different levels of convergence • in the field of occupational pensions • with other financial services • in the field of occupational pensions • to avoid supervisory arbitrage • prudent person rule: exchange of experience • exchange of information on supervisory framework and content Warsaw, 18 September 2006

29. Common Understanding • fully funding • ring-fencing • subordinated loans Warsaw, 18 September 2006

30. Exchange of Information • investment rules • custody and depositary • reporting and information requirements • insolvency and insurance systems • cross-border membership • optional application of the Directive • private schemes and the EU legislation • not covered ”pillars”, institutions and activities Warsaw, 18 September 2006

31. Exchange of Experience • authorisation and notification procedures • supervisory actions/sanctions • supervisory approaches • case studies Warsaw, 18 September 2006

32. III.Closing Remarks

33. Expectations • the OPC should not be expected to • overtake responsibilities from member states • determine the relevant S&L law • find a solution for regulatory problems • reach a uniform application of the whole Directive Warsaw, 18 September 2006

34. Closing Remarks • implementation of the Directive • 20 countries OK, 2 partial notification, 3 no notification • quality matters rather than time • long process: primary and secondarylegislation • pan-European pensionfunds • not classical pan-European solutions • asset pooling • central services Warsaw, 18 September 2006

35. Closing Remarks • pensions coordination • no competent body on S&L law • competent authorities having no supervisory responsibility • several aspects of pension services • supervisory cooperation • CEIOPS-CEBS-CESR Warsaw, 18 September 2006

36. Thank you for your attention !Dziękuję za uwagę !Dank u voor uw aandacht ! more info on www.ceiops.org