EU Pensions Directive
Legislative and regulatory updates present both risks and opportunities for pension scheme management, on both a local and multinational basis.
One of the latest developments affecting pension schemes operating with the European Economic Area (EEA) is EU Pensions Directive (IORP II).
The amendments to the existing legislation focus on governance and disclosure. Although there are many references to the adoption of a proportionate approach there are several provisions that have imposed new requirements on schemes. The cost of compliance could be particularly significant for smaller schemes. Many larger schemes will already be applying many of the elements as best practice, and many multinationals are seeking to adopt similar expectations of their local plans globally.
IORP II introduces a range of requirements for occupational retirement plan arrangements in the European Union relating to:
The requirements apply to local regulators, who then specify the details required in their jurisdiction.
Regulators are able to apply the requirements in a manner that is proportionate to the size, nature, scale and complexity of IORPs in their jurisdiction. Local regulators may, of course, add requirements beyond those mentioned in IORP II.