EUROPE - Cases against three European Union member states over the pension fund directive have been launched today at the European Court of Justice, Internal Markets Commissioner Charlie McCreevy told the annual IPE Awards.
Delivering the keynote speech at the sixth annual awards event in Paris, McCreevy said it was "imperative" that the Institutions for Occupational Retirement Provision (IORP) directive was applied consistently and effectively across the EU.
He told delegates: "I regret deeply the fact that - more than one year after the transposition deadline for the directive has expired - there are still three member states which have not notified their national implementation measures for this directive.
"Court cases against these three countries have been launched today." The counties are Belgium. Italy and Cyprus, although it's understood that Cyrpus has transposed the directive into national law as of today.
Italy and Belgium are expected to transpose the directive into national legislation early in the new year.
Commission has earlier said it would refer Slovenia, the UK and Italy to the ECJ over the directive.
Asked whether the barriers to the directive are too high, McCreevy said: "Honestly I don't know yet because there are countries that still haven't implemented the directive and we will have to see how the implementation process goes. Tax issues can only be changed unanimously - the important thing is there shouldn't be discrimination between cross-border and national pension fund activities."
McCreevy also said he saw no need for "prescriptive rules and restrictions" on where pension funds invest.
He said: "I am particularly disappointed to hear of instances where IORPs encounter resistance as a result of national investment limits applied to pensions funds' asset allocations.
"This represents a puzzling derogation from the 'prudent man' principle. Fund managers are seasoned professionals and should be perfectly capable of judging how much risky investment their portfolio can absorb."
The Commissioner stated: "Proper implementation and enforcement of this directive are essential.
"Because well functioning, integrated and competitive second-pillar pensions markets will reduce costs for pension scheme providers; they will provide workers /consumers with better retirement solutions and access to the products and providers which can best meet their individual needs. And encourage pan-European labour mobility."
He also tackled the "slow evolution" of European annuities and longevity risk markets - hindered by the limited supply of instruments to hedge against longevity risk.
"Given their importance in structuring retirement products, public authorities may wish to ensure that the conditions are in place to help these longevity risk markets to develop successfully. This is one of the many issues that are now being looked at by Finance Ministries."
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