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Since the consultation period on the revised Directive for Institutions for Occupational Retirement Provision (IORP) closed on 2 January, many industry figures have raised concerns over the feasibility of harmonising Europe's social labour laws and tax regulations – still the biggest barriers to the introduction of cross-border pension funds. But while most would seem to hope that a properly-revised Directive will help to overcome those obstacles, some experts have reached the conclusion that IORP vehicles simply should not be developed anymore.
Jérôme Dedeyan, president at France-based consultancy Debory-Eres, has instead called for the use of UCITS for pension funds. According to Dedeyan, building individual pension accounts that could be transferred from one country to another throughout an employee's career would be a better alternative to IORP funds, as well as a "more flexible approach" for both contributors and sponsors. "UCITS funds have proven their success over the years, and these vehicles could now serve as an example to bring new and simpler long-term savings vehicles to European consumers", he said. "Clearly, the contributors and sponsors will be subject to the local social labour laws, as well as the local taxes in which the UCITS fund is based."
However, Bernard Delbecque, director of economics and research at the European Fund and Asset Management Association (EFAMA) – which called for the introduction of a personal retirement plan called the Officially Certified European Retirement Plan (OCERP), backed by UCITS investment funds in 2010 – insisted that the European Commission should continue in its efforts to improve regulation for cross-border vehicles. He said: "The creation of pension plans such as the OCERP would need to be based on the IORP model in order for pension fund sponsors to promote their vehicle in several Member States across Europe".
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