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The Future of Supplementary pensions in Europe



The European Commission has taken the initiative on pension reform at
EU level. Most recently it tabled on May 11, 1999 a Communication entitled
"Towards a single market for supplementary pensions". FEFSI very much
welcomes the recom-men-dations of the European Commission. FEFSI, in
particular, welcomes the recognition of investment funds and companies as
suitable pension vehicles by the Commission. FEFSI believes that traditional
(i.e. defined benefit) pension institutions should be allowed to invest freely
in UCITS and other regulated collective investment schemes and urges the
Commission to take all necessary steps to ensure this freedom. The Commission
has recognised the need to guarantee equal treatment between different
occupational pension providers and stated the need to establish a genuine
prudential framework for pension service providers which could involve the
definition of similar rules for well defined products . FEFSI argues that there is
a need to define specific rules for supplementary defined contribution ("DC")
systems on EU level. Because DC systems may take various forms ranging from
single funds to self-directed pension savings plans with a wide range of
investment options, FEFSI believes that a European pension fund directive
should not prescribe a specific DC system. Instead FEFSI believes that the
envisaged directive needs to address in general qualitative terms the following
key areas with respect to DC pension funds ("DCPF"):

ISSN 1367-580x.