the Pensions regulator plans to address cross-border scheme issues
A proportionate risk-based approach as well as fast and efficient regulatory processes are two key areas the Pensions Regulator will address when forming its regulation on cross-border schemes.
In its consultation report on cross-border schemes and the approach to implementation, the Pensions Regulator said it was mindful of concerns raised by respondents and would take on board the suggestions made.
The report looked at how the authorisation and approval process would be operated, how funding requirements would work and the approach to supervision on cross border schemes.
Respondents included the Association of Pension Lawyers (APL), Association of Consulting Actuaries, A Pension Scheme, Legal & General Assurance Society, the European Federation of Retirement Provision and Aegon UK.
The report showed there was agreement for a proportionate risk-based approach which would take into consideration the overall size of a scheme and the size of the cross-border element, as well as the need to develop intelligence systems to support the risk-based approach.
However, respondents said it was imperative potential commercial opportunities were not stifled by setting the regulatory hurdle too high and that due care and consideration must be exercised by the regulator.
Concern was also expressed over time limits. The APL said a scheme's activities would be seriously undermined if the regulator took the maximum time limit available under the directive to effect authorisation and approval.
There was also a general consensus that the authorisation and approval process could be much simpler, while still meeting with directive requirements.
In response to the highlighted points, the Pensions Regulator said: "Work is going ahead on risk-based regulation. The regulator is aware of the need not to stifle commercial initiatives. The risk-based processes for cross-border schemes are being developed with these factors in mind."
It also said it was aware of concerns over time limits and would "endeavour to provide an approval process that was efficient and fast".
It said: "Given the novel nature of the process, schemes may have to build the potential maximum time limits into their planning. There are also very critical time limits for existing schemes in the legislation and these schemes will be dealt with these cut-off dates in mind."
Consultation on cross-border schemes and approach to implementation by the Pensions Regulator has been released
A proportionate risk-based response and fast and efficient regulatory processes to be implemented
Commercial initiatives not to be stifled
The forces at play in investment - most obviously, regulatory change, uncertain markets and shifting demographics - are as strong today as they were when Professional Adviser launched its sister magazine Multi-Asset Review in 2017.
Regulator has visited some firms already
Platforms react to Fidelity blocking Income Focus purchases
Chris Hill's letter to Treasury
Cash balance surges