The provisions of the Pensions Act, 1990 (the "Pensions Act") were amended by the provisions of the Social Welfare and Pensions Act, 2005 (the "2005 Act") which was passed into law in March 2005.
New Pension Regulations (the "Regulations") were introduced by the Minister for Social and Family Affairs Mr. Seamus Brennan who signed the Regulations into law with effect from the 23rd September, 2005. The purpose of the Regulations is to give effect to Council Directive 2003/41/EEC of 3 June 2003, the first EU Pensions Directive (the "Directive"). Complementary tax changes were also introduced in the Finance Act, 2005.
The Directive aims to introduce a common minimum level of supervision across the EU. Clearly this will only occur between those countries which have taken the necessary steps to transpose the Directive into law in their own countries. So far, only 9 countries have done so one of which is Ireland. This will indicate Ireland's willingness to provide a favourable pensions environment which it is hoped will in turn encourage foreign pension schemes to seek the necessary authorisation to locate their pension schemes in Ireland and/or be permitted to accept contributions from Irish persons into their foreign pension scheme. The Regulations were transposed to give effect to the obligations contained in the Directive affecting not only the regulation of cross border pensions but also the national regulation of domestic pension arrangements.
Scope and the Regulations
The scope of the new Regulations is far reaching. Regulations dealing with a number of diverse aspects of pension regulation from issues such as cross border regulations, trustee regulations, professional guidance and preservation of benefits regulations as well as investment and borrowing regulations have now been introduced.
For the purposes of this Article, I propose focussing on the areas of the qualification of pension trustees to act in that capacity, their authorisation to operate cross border schemes as well as the investment and borrowing regulations which have now been introduced.
Trustee Eligibility Criteria
Section 34 of the 2005 Act amends Section 59 of the Pensions Act by the insertion of a new Section 59A therein.
Section 59 as also amended by Section 42 of the Pensions (Amendment) Act, 2002 outlines the general duties of a pension trustee which broadly speaking include an obligation to ensure that contributions made are received, properly invested and paid out in accordance with the regulations and the provisions of the relevant scheme. "Scheme" is defined in the Pensions Act as an occupational pension scheme. The Section also includes an obligation to ensure that proper membership and financial records of the scheme are kept.
The new Section 59A(1) sets out in detail the qualifications to act as a pension trustee. The Section lists a number of disqualifications which preclude certain persons or categories of persons from acting as a...