EUROPE – Jaap Maassen, the chairman of the European Federation for Retirement Provision, has warned there are “shadows” over the implementation of the pension fund directive.
These include protectionism and regulatory issues, Maassen writes in a foreword to the new edition of ‘International Pension Funds and their Advisors’. Cross-border pension fund operations are “at risk” he adds.
“The bad news is that old habits die hard: secretiveness, a tendency to slide too easily from social protection to market protectionism, and a belief that greater regulatory details means more security together case the shadows over the implementation of the directive,” he writes.
The deadline for the directive, officially known as Institutions for Occupational Retirement Provision, is September 23.
“A number of aspects put ‘at risk’ the effective cross-border operations of pension funds,” says Maassen, who is also director of pensions at Dutch civil service fund ABP.
These include annual accounting and reporting requirements (articles 10 and 11), where Maassen acknowledges the directive’s text is “oddly worded”. But he refutes the idea that the articles demand that every fund has to produce annual accounts for itself and each scheme it operates.
On the prudent person rule, Maassen says article 18 - which allows states to lay down more detailed rules provided they are prudently justified - cannot mean “if a member state feels like it”.
And he sees other problems, including funding (article 16) and scope of host state supervision (article 20).
Maassen says CEIOPS, the Committee of European Insurance and Occupational Pension Supervisors, is the one place where these issues can be debated.
But he says CEIOPS is “potentially handicapped” by a ban which prevents it addressing social and labour law.
“Like the directive, CEIOPS is an immense opportunity which must not be squandered,” he says.
‘International Pension Funds and their Advisors 2005/06’, or the “Red Book” is published by Aspire, a joint venture between IPE and AP Information Services.