PensionsEurope has raised concerns about the inclusion of IORPs in the scope of the Financial Data Access (FiDA) regulation for those that offer personal pensions.

Ahead of the upcoming trilogue negotiations on FiDA, PensionsEurope welcomed the European Council’s position to exclude pension rights in officially recognised occupational pension schemes.

It also welcomed the council's provisions in Article 2(1)1a to create a member state opt-in system for the above-mentioned customer data category.

“It would account for the diverse EU occupational pension landscape by ensuring the exclusion of occupational pension schemes while preserving the ability of member states to include them in the scope if they wish to do so,” the association stated.

However, it said it had “reservations” in regard to Article 2(2)k of the council text to include IORPs in the scope as data holders and data users “insofar as they manage personal pension products” as it would have some “unintended effects”.

As it stands, this would include IORPs that are obligated (by national labour and social law) to manage personal pension products that started as occupational pension rights, as well as IORPs that devote only a very small part of their activities to personal pension products, which are defined by reference to Article 2(1) of the PEPP regulation.

PensionsEurope noted that in some member states IORPs can offer personal pension products but only in a limited number of cases.

For example, in Germany IORPs are barred from offering PEPPs. IORPs can make a targeted offer to representatives of sponsoring undertakings for a specific type of personal pension (e.g. Rürup pensions), which in its design and tax treatment is modelled after the German first pillar pension system. Those representatives are not employees. However, only five German IORPs have ever made use of this possibility and among them, only two still actively do so.

“Thus, such offers are exceptional in nature for IORPs and represent in all instances only a small margin of their operations. In Italy, IORPs that are Open Pension Funds can be considered as managing personal pension products as those funds are open to individuals and not regulated by a collective agreement,” the association said.

Furthermore, in Italy, IORPs are often open to the dependents of the members, to members who are no longer eligible, and in a few cases to self-employed. In Italy, people can continue to pay voluntarily their contributions to their pension scheme when they leave their company if they don’t decide to redeem their pot or transfer their pension scheme elsewhere.

The association argued that FiDA compliance as a data holder for IORPs managing personal pension products would “provoke very high fixed costs” and be “disproportionate in view of the small number of use cases” in which a FIDA-based financial data service could potentially offer a benefit to a member.

For example, it said developing the FIDA IT infrastructure would include implementing a multi-user data access interface like the permission dashboards, new Applications Programming Interfaces (APIs) as has been the case with PSD2 and Financial Data Sharing Schemes (FDSS).

“Pension rights holders and their pension rights would also be negatively affected by legislation given the high costs that IORPs will have to bear,” PensionsEurope stated.

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