GERMANY/EUROPE - The German Finance Ministry (BMF) is fearful that the European Commission's plans for a new supervisory structure will give pan-European bodies more influence over national retirement systems.

More details on how the competences of a future EU supervisory body could be widened are to be revealed by the EU at the end of October and the system is set to be implemented in the first half of 2010, explained Werner Kerkloh, head of the stock exchange division at the BMF, at the aba's autumn conference in Ulm. (See earlier IPE story: EC presses ahead with plans to end CEIOPS)

One of the competences of the new EU supervisor is to be to set binding standards for national supervisory authorities and the EU commission wants the right to approve and, if it deems it necessary, change those.

"We are very critical concerning this influence," stressed Kerkloh.

He also is against the future pension supervisor EIOPA having the right to directly take administrative action against a national pension vehicle should there be no consensus on a situation with the national supervisor, and stressed the German financial ministry "will fight this".

Kerkloh also said he hoped "a sensible solution will be found eventually" in relation to the EU Commission's power to call a crisis and get the EU supervisor to give orders to national supervisors - a strategy which Kerkohl warned " could have pro-cyclical effects".

Early warnings to be issued by the new EU supervisor are non-binding as stated in the EU's suggestions.

But Kerkloh is convinced that they will be binding because a body is likely to have to take the blame should, for example, the BaFin not follow a warning and subsequent events then play out as feared.

He hopes the EU Commission will split the setting-up of the new supervisory system and deal with matters concerning occupational pension vehicles at a later point in time.

"It could combine these efforts with the planned review of the pension fund directive," he argued.

Kerkloh said he would also like to see more retirement and insurance experts on the board of the European Systemic Risk Board (ESRB) than just the future EIOPA-president.

And when it comes to financing the new supervisory bodies, Kerkloh added he does not want to see too much money from the EC go into the structure as he believes this is likely to mean the European Commission has more influence.

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