United Kingdom

Cross-border Pensions: IORP II Requirements

One of the main objectives of IORPII is to facilitate the cross-border activity of pension funds and the cross-border transfer of pension schemes. The following is provided by the Directive:

  • Cross-border pensions would potentially lead to significant economies of scale for such IORPs, improve the competitiveness of Union industry and facilitate labour mobility
  • Member States are encouraged to build up adequate, safe and sustainable occupational retirement provision and facilitate cross-border activity
  • The cross-border activity of IORPs should fully respect the provisions of the social and labour law in force in the host Member State insofar as it is relevant to occupational pension schemes
  • Cross-border activity and the cross-border transfer of pension schemes are distinct and should be governed by different provisions
  • Transfers should be authorised by the competent authority in the receiving IORP’s Member State, once they have received the consent of the competent authority in the transferring IORP’s Member State
  • The transfer and its conditions should be subject to prior approval by a majority of the members and a majority of the beneficiaries concerned or, where applicable, by a majority of their representatives
  • The host Member States should not be allowed to impose additional investment requirements on IORPs located in other Member States
  • It should be possible for Member States to require the appointment of a depositary in relation to the safe-keeping of the assets of IORPs
  • In the event of cross-border activity, the technical provisions shall at all times be fully funded in respect of the total range of pension schemes operated

We work with the EC and other stakeholders, lobbying to effect changes that will benefit employers and members alike; for example, asking for changes to the Directive around approval of transfers and for pragmatic guidance in the interim.

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Read more on the IORP requirements around governance, risk management and member communication.