16 April 2007

DNB warns funds about going to Belgium

The Dutch central bank has warned pension funds about moving to neighbouring Belgium, saying they could be faced with disappointing results. The comments came from De Nederlandsche Bank executive director Dirk Witteveen. He was speaking at the annual conference of the VB, the Dutch Association of Industry-Wide Pension Funds, in Scheveningen today.

Witteveen said Belgium is trying to 'sell a car without having the technical specifications yet'.

The remarks follow moves by Belgium to become a European pension hub. As of January 1, it has introduced new pensions legislation aimed at making it attractive for cross-border pension activities, as allowed by the European pensions directive.

Belgian pension officials told IPE they would be studying Witteveen’s comments.

'Some argue that the Belgian supervisory demands are less stringent,' Witteveen told the meeting.

He added: 'But it is difficult to assess if the demands of the supervisor are simpler, as a large part of these supervisory demands have not even been fully developed yet.'

He promoted the idea of Holland as a pension country. 'Good value sells itself,' he said, referring to the country’s pensions expertise.

'I don't want to say we are the best, but there certain marginal comments should be placed [against Belgium],' he added.

He was adamant that the Netherlands do not need a sales pitch similar to Belgium's, adding: 'Some ask what has Belgium what Holland doesn't have? Neighbours in the North someone said earlier. But partly it is also a copy of the Dutch system.'

'Holland has the potential to play a significant part in the European pensions market,' he concluded, adding: 'We have the proven technology which others haven't got'.

Last month the Belgian pensions supervisor CBFA said it is vetting the applications of five foreign pension funds which want to establish themselves in Belgium.

© IPE International Publishers Ltd.