Duty of trustees or managers to act consistently with law of host member State
Mr Secretary Smith
NC9
To move the following Clause:—
'(1) Where the trustees or managers of an occupational pension scheme receive contributions to the scheme from a European employer, the trustees or managers must ensure that the scheme, so far as it relates to members who are or have been employed by the employer, is operated in a way which is consistent with the requirements of the social and labour law of the host member State.
(2) Regulations may modify any provision of pensions legislation in its application to members of an occupational pension scheme in respect of which the employer is a European employer.
(3) If the trustees or managers of a scheme fail to comply with subsection (1), section 10 of the Pensions Act 1995 (c.26) (civil penalties) applies to any trustee or manager who has failed to take all reasonable steps to secure compliance.
(4) In this section "pensions legislation" means—
| (a) | the Pension Schemes Act 1993 (c.48), |
| (b) | Part 1 of the Pensions Act 1995 (c.26), other than sections 62 to 66A of that Act (equal treatment), |
| (c) | Part 1 or section 33 of the Welfare Reform and Pensions Act 1999 (c.30), or |
Functions of Regulator in relation to institutions administered in other member States
Mr Secretary Smith
NC10
To move the following Clause:—
'(1) Where a UK employer makes (or proposes to make) contributions to a European pensions institution, any function which Article 20 of the Directive requires or authorises to be exercised by the competent authorities of the host member State is exercisable by the Regulator.
(2) If the Regulator receives a notification in pursuance of Article 20(4) of the Directive from the competent authority in another member State, the Regulator must within 2 months inform that authority of any relevant legal requirements.
(3) Where there is a significant change in any relevant legal requirements, the Regulator must as soon as reasonably practicable inform any competent authority in relation to which it has provided information under subsection (2) of that change.
(4) Where a UK employer makes contributions to a European pensions institution, the Regulator must—
| (a) | monitor the compliance of that institution with the relevant legal requirements, and |
| (b) | if the Regulator becomes aware of any contravention by the institution of any relevant legal requirements, inform the competent authority of that member State of the failure. |
(5) If the Regulator is satisfied that a European pensions institution which receives contributions from a UK employer is contravening any relevant legal requirements, the Regulator may issue a notice to the UK employer directing him—
| (a) | to take or refrain from taking such steps as are specified in the notice in order to remedy the failure by the institution, or to cease to make further contributions to the institution. |
(6) Regulations may make further provision about the effect of a notice under subsection (5)(b), including provision conferring functions on the Regulator.
(7) Section 10 of the Pensions Act 1995 (civil penalties) applies to any UK employer who, without reasonable excuse, fails to comply with a notice under subsection (5).
(8) In this section—
"European pensions institution" means an institution for occupational retirement provision, as defined by Article 6(a) of the Directive, that has its main administration in a member State other than the United Kingdom; "relevant legal requirements" means such requirements of the law relating to occupational pensions, as it applies in any part of the United Kingdom, as may be prescribed; "UK employer" means an employer who—
| (a) | in the case of a body corporate, is incorporated under the law of the United Kingdom or any part of the United Kingdom, or |
| (b) | in any other case, is resident in the United Kingdom.'. |
Interpretation of Part
Mr Secretary Smith
NC11
To move the following Clause:—
"competent authority", in relation to a member State other than the United Kingdom, means a national authority designated in accordance with the law of that State to carry out the duties provided for in the Directive; "the Directive" means Directive 2003/41/EC of the European Parliament and of the Council on the activities and supervision of institutions for occupational retirement provision; "European employer" has the meaning given by section (Occupational pension scheme receiving contributions from European employer)(6); "host member State", in relation to a European employer, has the meaning given by section (Occupational pension scheme receiving contributions from European employer)(6); "social and labour law", in relation to a member State other than the United Kingdom, means the social and labour law (within the meaning of Article 20 of the Directive) of that State relevant to occupational pensions.'.
Restoration orders where transactions at an undervalue
Mr Secretary Smith
NC12
To move the following Clause:—
'(1) This section applies in relation to an occupational pension scheme other than—
| (a) | a money purchase scheme, or |
| (b) | a prescribed scheme or a scheme of a prescribed description. |
(2) The Regulator may make a restoration order in respect of a transaction involving assets of the scheme if—
| (a) | a relevant event has occurred in relation to the employer in relation to the scheme, and |
| (b) | the transaction is a transaction at an undervalue entered into with a person at a time which— |
| (i) | is on or after 11th June 2003, but |
| (ii) | is not more than two years before the occurrence of the relevant event in relation to the employer. |
(3) A restoration order in respect of a transaction involving assets of a scheme is such an order as the Regulator thinks fit for restoring the position to what it would have been if the transaction had not been entered into.
(4) For the purposes of this section a relevant event occurs in relation to the employer in relation to a scheme if and when on or after the appointed day—
| (a) | an insolvency event occurs in relation to the employer, or |
| (b) | the trustees or managers of the scheme make an application under subsection (1) of section 116 or receive a notice from the Board of the Pension Protection Fund under subsection (5)(a) of that section (applications and notifications prior to the Board assuming responsibility for a scheme). |
(5) For the purposes of subsection (4)—
| (a) | the "appointed day" means the day appointed under section 113(2) (no pension protection under Chapter 3 of Part 2 if the scheme begins winding up before the day appointed by the Secretary of State), |
| (b) | section 110 (meaning of "insolvency event") applies for the purposes of determining if and when an insolvency event has occurred in relation to the employer, and |
| (c) | the reference to an insolvency event in relation to the employer does not include an insolvency event which occurred in relation to him before he became the employer in relation to the scheme. |
(6) For the purposes of this section and section [Restoration orders: supplementary], a transaction involving assets of a scheme is a transaction at an undervalue entered into with a person ("P") if the trustees or managers of the scheme or appropriate persons in relation to the scheme—
| (a) | make a gift to P or otherwise enter into a transaction with P on terms that provide for no consideration to be provided towards the scheme, or |
| (b) | enter into a transaction with P for a consideration the value of which, in money or money's worth, is significantly less than the value, in money or money's worth, of the consideration provided by or on behalf of the trustees or managers of the scheme. |
(7) In subsection (6) "appropriate persons" in relation to a scheme means a person who, or several persons each of whom is a person who, at the time at which the transaction in question is entered into, is—
| (a) | a person of a prescribed description, and |
| (b) | entitled to exercise powers in relation to the scheme. |
(8) For the purposes of this section and section [Restoration orders: supplementary]—
"assets" includes future assets; "transaction" includes a gift, agreement or arrangement and references to entering into a transaction are to be construed accordingly. (9) The provisions of this section apply without prejudice to the availability of any other remedy, even in relation to a transaction where the trustees or managers of the scheme or appropriate persons in question had no power to enter into the transaction.'.
Restoration orders: supplementary
Mr Secretary Smith
NC13
To move the following Clause:—
'(1) This section applies in relation to a restoration order under section [Restoration orders where transactions at an undervalue] in respect of a transaction involving assets of a scheme ("the transaction").
(2) The restoration order may in particular—
| (a) | require any assets of the scheme (whether money or other property) which were transferred as part of the transaction to be transferred back— |
| (i) | to the trustees or managers of the scheme, or |
| (ii) | where the Board of the Pension Protection Fund has assumed responsibility for the scheme, to the Board; |
| (b) | require any property to be transferred to the trustees or managers of the scheme or, where the Board has assumed responsibility for the scheme, to the Board if it represents in any person's hands— |
| (i) | any of the assets of the scheme which were transferred as part of the transaction, or |
| (ii) | property derived from any such assets so transferred; |
| (c) | require such property as the Regulator may specify in the order, in respect of any consideration for the transaction received by the trustees or managers of the scheme, to be transferred— |
| (i) | by the trustees or managers of the scheme, or |
| (ii) | where the Board has assumed responsibility for the scheme, by the Board, |
to such persons as the Regulator may specify in the order;
| (d) | require any person to pay, in respect of benefits received by him as a result of the transaction, such sums (not exceeding the value of the benefit received by him) as the Regulator may specify in the order— |
| (i) | to the trustees or managers of the scheme, or |
| (ii) | where the Board has assumed responsibility for the scheme, to the Board. |
(3) A restoration order is of no effect to the extent that it prejudices any interest in property which was acquired in good faith and for value or any interest deriving from such an interest.
(4) Nothing in subsection (3) prevents a restoration order requiring a person to pay a sum of money if the person received a benefit as a result of the transaction otherwise than in good faith and for value.
(5) Where a person has acquired an interest in property from a person or has received a benefit as a result of the transaction and—
| (a) | he is one of the trustees or managers or appropriate persons who entered into the transaction as mentioned in subsection (6) of section [Restoration orders where transactions at an undervalue], or |
| (b) | at the time of the acquisition or receipt— |
| (i) | he has notice of the fact that the transaction was a transaction at an undervalue, |
| (ii) | he is a trustee or manager, or the employer, in relation to the scheme, or |
| (iii) | he is connected with, or an associate of, any of the persons mentioned in paragraph (a) or (b)(ii), |
then, unless the contrary is shown, it is to be presumed for the purposes of subsections (3) and (4) that the interest was acquired or the benefit was received otherwise than in good faith.
(6) For the purposes of this section—
| (a) | section 249 of the Insolvency Act 1986 (c.45) (connected persons) applies as it applies for the purposes of any provision of the first Group of Parts of that Act, |
| (b) | section 435 of that Act (associated persons) applies as it applies for the purposes of that Act, and |
| (c) | section 74 of the Bankruptcy (Scotland) Act 1985 (c.66) (associated persons) applies as it applies for the purposes of that Act. |
(7) For the purposes of this section "property" includes—
| (a) | money, goods, things in action, land and every description of property wherever situated, and |
| (b) | obligations and every description of interest, whether present or future or vested or contingent, arising out of, or incidental to, property. |
(8) References in this section to where the Board has assumed responsibility for a scheme are to where the Board has assumed responsibility for the scheme under Chapter 3 of Part 2 (pension protection).'.
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