BELGIUM - Minister of pensions Bruno Tobback has said the bill transposing the EU pensions directive makes "considerable progress" towards the creation of a legal framework for pension funds.
The existing taxation framework (ASBL/ VZW) that pension funds fall under is something of broad church which can be applied to numerous organisations including football clubs and hospitals.
Speaking exclusively to Global Pensions, Tobback said: “It [the bill] explicitly takes into account most of the suggestions formulated by the sector of pension funds. It will provide a coherent prudential framework by replacing the current Royal Decrees for pension funds by a law especially designed to take into account specific characteristics of pension funds.”
Tobback added that the future law also allowed for a delegation of the financial and administrative management of pension plans to be passed from the the board of directors (Raad van Bestuur) to an executive committee (Directiecomité).
“This allows for example a board equally representing employers and employees to delegate technical competences to an executive committee controlled by the board,” he said.
Another important step that the future law had taken towards the creation of a legal framework for pensions was to enhance the level playing field in the market for occupational pensions, said Tobback.
“In Belgium, pension funds can take the legal form of a mutual insurance organisation or a non profit organisation. This will remain so in the future,” he explained. “However the organisational structure of the mutual insurance organisation is not well regulated while on the contrary for non-profit organisations, it is clearly regulated by law.
“Therefore, the future law on pension funds foresees explicitly that, as far as pension funds are concerned, the legislation for non profit organisations acts as common law.”
Hugo Clemeur, general secretary of the Belgian Association of Pension Funds (BPFA), said the new draft law had taken into account a number of the provisions the association had set forward in its proposal for a new legal entity specific for pension funds, but not all of them.
“We still hope to see even more progress made in the near future via amendments to the draft law in parliament,” he said.
“If, in the end and as a result of these amendments, the new law provides for what we consider as proper statutory rules as well as proper working conditions for pension funds constituted as ASBL's or mutual insurance organisations, we would obviously be very satisfied, and the need for a new specific legal entity would fade entirely. But there is still a distance to go.”
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