Pooled Registered Pension Plans: Federal Government proposes multilateral agreement
On July 15, 2015, the Federal Government published the draft Multilateral Agreement Respecting Pooled Registered Pension Plans (the “Agreement”). The Agreement is intended to streamline the supervision and administration of Pooled Registered Pension Plans (PRPPs) across Canadian jurisdictions by allowing PRPPs to be registered only with the federal Office of the Superintendent of Financial Institutions (OSFI) instead of provincial pension regulators, with some exceptions in Quebec. The Agreement would be open to any province that has adopted PRPP legislation similar to the federal Pooled Registered Pension Plans Act.
The Agreement addresses a number of issues related to the oversight of PRPPs, including the following:
Licensing and plan registration
- A corporation which holds a federal PRPP license or a license for a Voluntary Retirement Saving Plan (VRSP) from the Autorité des marchés financiers (AMF) in Quebec would not be required to obtain a PRPP license or register a PRPP in another province if the applicable province is a party to the Agreement.
- A corporation which holds a VRSP license would be exempt from the requirement to obtain a license or register a PRPP under the federal PRPP Act.
- The AMF would issue a license to a PRPP administrator and register a federally-registered PRPP if additional requirements outlined in a schedule to the Agreement are met.
- The supervisory authority for federally registered PRPPs would be OSFI. OSFI would exercise powers of a provincial supervisory authority that is party to the Agreement, in accordance with the terms of the Agreement.
- Some decisions of OSFI, as related to matters specified in a schedule to the Agreement, would be deemed to be a decision of the applicable provincial supervisory authority. The review and appeal process for such decisions would be subject to the laws of the applicable province.
- The provisions of the federal PRPP legislation would apply to a federally registered PRPP, instead of the corresponding provincial PRPP legislative provisions that would have applied in the absence of the Agreement.
- However, in respect of specified matters such as definitions of spouse and death benefits, the laws of the province of the member’s employment (or last employment, if no longer active) would govern.
The Federal Government has stated that the Agreement is expected to lower costs and red tape by avoiding the need to pay multiple licensing and registration fees.
Comments may be submitted to the Federal Government by August 29, 2015.