IOPS invites public comment on draft guidelines for supervisory intervention, enforcement and sanctions

30/03/2009 - The IOPS invited public comment on draft guidelines for supervisory intervention, enforcement and sanctions.

Due to the crucial role of the private pension systems within the financial markets, and their increasing importance as a source of retirement income for individuals, the effective supervision of pension funds is becoming ever more important.
The objectives of pension supervision include protecting the interests of pension fund members and beneficiaries, safeguarding the stability of the pension industry and contributing to the stability of the financial system as a whole. To achieve these objectives, supervisory authorities need not only to have adequate supervisory methods but also to be able to enforce regulations and require pension funds to take remedial action when necessary. The question of whether, when and how to intervene in the operation of pension funds is of crucial importance if the objectives of supervision are to be met.

The guidelines are intended to reflect international good practice regarding the powers which are needed by supervisory authorities in relation to intervening, applying sanctions and enforcing action in regards to the pension entities they oversee, and how these powers should be used in order to maximise benefits and minimise costs. These guidelines build on the IOPS ‘Principles of Private Pension Supervision’, and draw on the OECD ‘Core Principles of Occupational Pension Regulation’, the IAIS ‘Insurance Core Principles and Methodology’ as well as IAIS guidance papers, and IOSCO’s ‘Objectives and Principles of Securities Regulation’. Although these guidelines serve as a benchmark reference, the question of how to best apply them in practice should take into account country-specific conditions and circumstances.

The deadline for comments was 5 May 2009.

See the draft guidelines.

Comments should be sent to the IOPS Secretariat: fiona.stewart@oecd.org

For further information, journalists should contact Fiona Stewart, IOPS Secretariat (tel. +33 1 45 24 14 52).