The European Association of Paritarian Institutions (AEIP) has called for an EU framework for IORPs, whilst also raising concerns about the introduction of delegated acts, in response to the European Commission’s Supplementary Pensions Package.

In its position paper, the AEIP said such a framework should better reflect the nature, role and governance model of paritarian occupational pensions in Europe.

Although the AEIP supports the commission’s objective of expanding occupational pensions across the EU, it believes the proposal should more clearly recognise the diversity of IORPs across member states.

It stressed that rules and concepts designed for retail financial products should not be extended to paritarian pension institutions.

In AEIP’s view, the future framework should remain proportionate, preserve the role of social partners, and reflect the specific social and collective character of occupational pensions.

AEIP president, Werner Schneider, said: “The proposed review of the IORP II Directive introduces a number of governance and communication requirements that do not appear appropriate for paritarian institutions, given their specific social role, long-term investment perspective, and joint governance model based on equal representation of employers and employees.”

He believes that these would risk increasing administrative costs and burdens for IORPs without delivering clear added value for members and beneficiaries.

“In particular, the proposed introduction of an explicit duty of care for IORPs could create unnecessary duplications, as its core 2 elements are already embedded in the existing IORP II Directive and are effectively ensured through the internal checks and balances inherent in the paritarian model of governance,” he added.

Whilst it stressed the importance of maintaining the current minimum harmonisation approach of the IORP II Directive, the AEIP expressed concerns about the introduction of delegated acts.

Specifically, it said this could lead to increased regulatory complexity and reduce the flexibility currently available to member states and national competent authorities. Instead, the AEIP argued that supervisory authorities at the national level remain “best placed” to assess the risks and specific characteristics of pension institutions within their jurisdictions.

The association also reiterated that proportionality remains a “key issue” in the review. It noted that IORPs are diverse in nature and operate as small- and medium-sized institutions with limited administrative capacities.

The AEIP flagged that removing the reference to “size” from the proportionality criteria and introducing additional obligations could place unnecessary pressure on IORPs without clear added value for members and beneficiaries.

In addition, the association also raised concerns about the extension of communication and disclosure requirements inspired by a retail market logic, as well as by the proposed standardisation of the Pension Benefit Statement (PBS).

While it supports clear and meaningful information for members and beneficiaries, it stressed that communication rules for occupational pensions should remain tailored to the characteristics of collectively organised, employment-based pension arrangements and avoid unnecessary overlap with existing national tools and obligations.

AEIP executive director, Simone Miotto, said: “Occupational pension funds are long-term institutional investors that can play an important role in supporting Europe’s growth and competitiveness.

“The regulatory framework should therefore encourage efficient pension provision and long-term investment while avoiding unnecessary complexity. Simpler rules for IORPs would be fully consistent with the objectives of the Savings and Investments Union and the Commission’s Better Regulation Agenda.”

Despite its concerns, the AEIP welcomed the proposed clarification of the prudent person principle but said that IORPs should retain sufficient flexibility to align investment decisions with their risk profile, benefit structure and long-term objectives.

On the proposal to allow IORPs to offer the Pan-European Personal Pension Product (PEPP) Regulation within workplace arrangements, AEIP stressed that member states should retain full discretion to permit such arrangements, while safeguarding the role and autonomy of social partners in designing pension schemes through collective bargaining.

It is also supportive of the development of Pension Tracking Systems (PTSs) and the future connection of national systems with the European Tracking Service on pensions.

However, the association cautioned that mandatory EU reporting requirements linked to such systems could create significant operational costs for IORPs. Given the diversity of national pension systems, the AEIP said the design and format of PTSs should remain within the competence of member states.

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