On 23 October 2018, the Spanish government published a first draft of the law to implement the Spanish Financial Transactions Tax (FTT). On 15 November 2018, PensionsEurope answered to its consultation and e.g. warned that the FTT would be detrimental to pension savings. You can read PensionsEurope answer here.
Besides the plans of the Spanish government to introduce a national FTT, the Austrian Presidency has put forward proposals to simplify and restrict the scope of the FTT being discussed by the remaining ten Member States considering the introduction of an EU wide FTT under the enhanced cooperation procedure. On 27 November 2018, PensionsEurope published a press release and e.g. stressed that PensionsEurope is against the establishment of taxes on financial transactions, since such taxes, in their various typologies, end up becoming taxes on savings or pensions, in addition to affecting the efficiency of markets and producing a relocation in the financing flows of the real economy, towards companies established in non-taxed jurisdictions. You can find PensionsEurope press release here.
AEIP and Pensions Europe have published a joint position paper calling for political action to relieve pension fund participants from unnecessary VAT burden for contracted management services. The current interpretation of the VAT Directive leads to different treatment of pension plans for VAT purposes based on the form and the place of residence of the plan. In addition, the current regime provides insufficient guidance for hybrid pension plans (e.g. DB pension funds, where all or part of the risk is shifted from the employer to the fund itself or the employee) which are becoming more commonplace. This means that similar pension schemes in different countries face different tax treatments concerning the management services they procure. PensionsEurope and AEIP therefore call for a review of the VAT Directive that exempts all pension funds from paying VAT on management services. The press release is available here.
On 9 October 2018, PensionsEurope answered to EIOPA consultation on the taxonomy of new pension data reporting requirements. In our answer, we thanked the ECB and EIOPA for a constructive dialogue during the last years on preparing their new pension data reporting requirements. At the ECB workshop on 10 October 2018 we continued that open dialogue with the ECB, EIOPA, NCBs/NCAs, Eurostat and OECD, and we provided further comments and clarifications to them.
PensionsEurope shares the aim of EIOPA and the ECB to have better, comparable and relevant information on occupational pensions in Europe, and we welcome that the ECB, EIOPA, Eurostat, and OECD are aligning their reporting standards for pension funds.
We support a principle to leave flexibility to the NCAs in collecting data and providing it to the ECB and EIOPA. A starting point should remain the so-called ‘one-stop-shop’-concept, and considering the amount of information already available, the NCAs should play a central role therein.
In our answer, we suggested several amendments to better accommodate the needs of pensions funds. They particularly refer to the time frame, the binding nature of the XBRL format and the costs related to its introduction including licence and implementation costs.
PensionsEurope published a report on drivers of equity investments by pension funds on 25 September 2018. It is based on a survey which PensionsEurope conducted amongst our Members in the summer 2018.
The survey report supplements our comments to the CMU Sub Expert Group on pension funds on the main drivers in cross-border investment by pension funds and our Pension Fund Statistics. We hope and believe our comments are relevant to the upcoming “study on the drivers of investments in equity by insurers and pension funds” which DG FISMA has commissioned to Deloitte and CEPS to carry out by the end of 2018.
PensionsEurope welcomes the European Commission public consultation on fitness check on supervisory reporting. We find it important that the Commission regularly conducts fitness checks on supervisory reporting to ensure that the ESAs work effectively, and supervisory activities remain proportionate in their scope.
In general, pension funds are embedded in national social and labour law and supervisory reporting should take into account specificities of pension funds, National Supervisory Authorities are responsible for supervising pension funds, supervisors should consider very carefully which information is really relevant and needed (as reporting and collecting information always result in cost), and supervisors and policymakers should not have a bank bias towards pension funds.
Please find PensionsEurope answer to the EC consultation here.
PensionsEurope published today a position paper on smoothing WHT procedures beyond Code of Conduct - EU tax register of recognised pension institutions. In our paper, we propose to the European Commission to establish an EU tax register of recognised pension institutions in order that Member States can reciprocally and automatically recognise pension institutions. Furthermore, in many countries pension institutions invest cross border via specialised investments funds and/or vehicles to increase the economies of scale, and it is important to ensure a tax-neutral treatment of these investment structures as well.
PensionsEurope today published a position paper with its views on the review of the mandate of the European Supervisory Authorities (ESAs).
In our paper, we highlight the fact that pension funds do not fall under a harmonised European framework. National supervisors are therefore best equipped to take into account the specificities of pension funds, which are embedded in domestic labour and social law. This means that there less scope for supervisory convergence for pension funds and the mandate of EIOPA should reflect this. As pension funds are not directly supervised by the ESAs, they also feel they should not contribute directly to their budgets through industry fees.
Moreover, the governance structure of EIOPA should ensure that decision-making is underpinned by sufficient expertise in the area of pensions. We feel that individual stress test results of IORPs should not be disclosed and the Board of Supervisors should remain the decision-making body for the stress tests.
Finally, we welcome a bigger focus on better regulation and a stronger role for the Stakeholder Groups.
The Commission held a public hearing on simpler withholding tax procedures for Europe today to present the Code of conduct on withholding tax (WHT) to stakeholders and have a lively exchange of views. In today’s hearing, Mr Matti Leppälä, Secretary General/CEO of PensionsEurope, participated in the first panel discussion on the current state of play, why the WHT procedures are costly and lengthy, and to what extent implementing the code would improve the situation. Please find some of his remarks in our press release.