The latest revisions showed EU member states clawing back regulatory power from EIOPA, after wording amendments in the Directive.
The proposed European Capital Markets Union (CMU) has been hit by revisions to IORP II, according to Clifford Chance, as the legislation undergoes second negotiations in the European Council.
Significantly, Articles 29 and 30, which provide details on scheme risk evaluation, have been amended, giving power to national regulators after previously being seen as a risk for the implementation of solvency requirements through secondary the European Insurance and Occupational Pensions Authority (EIOPA) regulation.
Incoming financial services commissioner Jonathan Hill has the remit to create a foundation for a CMU, which he aims to complete by 2019. In statements prior to his approval by the European Parliament, Hill said underdeveloped occupational pensions were a barrier to the creation of the CMU, a key policy of the incoming Commission. The latest IORP II Directive draft also sees wording allowing members to veto any move for a scheme to become cross-border.
Before the proposals were made to shift power back to member states, the measures for risk-evaluation for pensions alluded to the use of solvency requirements to manage risk. It was expected this would come under the form of EIOPA’s flagship holistic balance sheet, on which it is currently consulting.
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