The Dutch pension fund of energy giant Chevron (SCP) has taken insurer ASR to court in a disagreement about the exact amount of pension liabilities it transferred to the insurer in 2015.
According to the Pensioenfonds Chevron, the problem centred on how the purchase price for pension rights was established. It said that “several millions” of euros were at stake.
At the time of the transfer, the scheme’s pension assets amounted to €370m. Its funding level was 127% in 2015, meaning the pension fund could negotiate a fixed level of indexation with ASR, as well as full indexation in arrears of 6.34%.
The unconditional indexation amounts to at least 80% of the European consumer index HICPxT.
According to the scheme, ASR claimed that the offered purchase price could only be changed as a result of later adjustments of the pension fund’s membership.
The scheme said that the final purchase price must be established using the method stipulated in the contract.
“We have discussed the matter several times, but have failed to reach an agreement ultimately,” said Cees van Klink, the pension fund’s chairman.
He emphasised that it was about different opinions and not about a high-running conflict: “We are not fighting in the street.”
Van Klink said that the outcome of the court case would not negatively affect existing pension rights.
A positive verdict in favour of the scheme would lead to higher indexation, according to the chairman. He added that the remaining balance following the liquidation of the pension fund would also be used to improve indexation.
Van Klink indicated that the dispute had delayed the liquidation of the scheme, which was scheduled for last year.
However, as the pension fund had already ceased its activities, the delay would not cause many additional costs, he said.
The pension fund was among the last schemes in the Netherlands with traditional final salary arrangements.
Asked for comment, ASR said it did not recognise the pension fund’s reflection of the disagreement, but refrained from further comments “as the case was a matter [for] the court”.
The insurer emphasised that it would keep on carrying out the pension plan as well as its service provision to the participants as normal.