Mercer asked more than 80 multinational organisations with headquarters in Europe and the US for their views on the issues, challenges and barriers to pan-European pension provision.
Respondents said they saw these schemes as vehicles for co-ordinating the move to DC plans, and that they also brought benefits in attracting staff and support for multinational benefit policies. However, a major obstacle to setting up these schemes included the requirement to implement them cost-effectively.
Respondents also felt that progress was being hampered by regulatory issues. Some jurisdictions were felt to be over-regulating on the requirements, while others were seen as being too lax. The likelihood is that this paralysis in the market will remain until the European Commission reviews the IORP directive and recommends changes to member state implementation.
Tax was seen as another barrier to setting up pan-European schemes. While the European Commission has largely addressed the issue of discrimination in tax treatment between a member state's nationals and those in other member states, the exact treatment of tax is still unclear. Organisations were also concerned that pan-European schemes would add another layer of unnecessary complexity in terms of the potential benefits.
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