The Council finally adopted the Directive on occupational retirement provision (IORP), agreeing on the text adopted on 12 March at second reading by the European Parliament.
At present, occupational pension providers operate for the most part only in the Member State in which they are established. The new Directive allows for mutual recognition of Member States' supervisory regimes. An IORP will be able to manage the schemes of firms located in other Member States while applying the prudential rules of the Member State in which it is established.
The institutions involved (such as pension funds and superannuation schemes) cover about 25% of the Union's labour force and manage assets worth € 2500 billion (29% of EU GDP). The Directive provides a set of principles to guide IORPs in their asset allocation strategy, in line with the 'prudent person principle'. The Directive also provides that investment in shares and in risk capital should not be unduly restricted. Member States would have the option of subjecting IORPs established within their jurisdiction to more detailed investment rules, but they would not be able to prevent such institutions from investing up to 70% of their technical provisions or portfolio in shares and corporate bonds and up to 30% in currencies other than the currency of their future pension liabilities.
The Directive is due to be implemented by Member States within 24 months of its publication in the EU's Official Journal.
Commission Press release
© Council of the European Union
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