UK – The Investment Management Association says pension pooling is stuck in “something of a stalemate”.
The IMA noted that a number of European Union member states have developed pooling structures which they believe are fiscally transparent.
The include the fonds commun de placement in Belgium, France and Luxembourg and the Common Contractural Fund in Ireland the pension fund pooling vehicle in the UK.
“However, because member states use different criteria to determine whether or not an entity is transparent, none of those pooling structures appear to be universally acceptable, and pension pooling has got stuck in something of a stalemate.”
The comments come in the IMA’s response to the European Commission’s green paper on asset management – in effect proposals about the future of the UCITS investment fund market - which was unveiled in July and whose consultation period ended yesterday.
The IMA reiterated its call for member states and the Commission to develop a common approach to dealing with the pooling tax issue via the Economic Cooperation and Development. This was the “most appropriate and practical way forward”.
Fiscal transparency would also facilitate cross-border private equity investments, the IMA added.
The OECD has a working party examining the application of the OECD Model Tax Convention on trusts, investment funds and other entities.
The IMA said it “strongly supports the European Commission in its push to increase the competitiveness and efficiency of the European funds industry by opening up the single European market, and believes the Green Paper correctly highlights the key changes required”.