“The protection of supplementary pensions in case

of insolvency of the employer for defined benefit and

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book reserve schemes”

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~ A study requested by the European Commission

ESOFAC Belgium and EURACS are pleased to invite you to attend a seminar
which will take place on 25 November in Zaventem, Belgium.
DATE AND LOCATION
25th November, 2010
Sheraton Brussels National Airport
1930 Zaventem

REGISTRATION
WHAT * At the request of the European Commission, Esofac Belgium and Euracs performed a study on the Before 15th November
maxbogaard@euracs.eu
protection of supplementary pensions.
* This study has been published on the European Commission’s website.
Panto
* In the conference the main findings and conclusions of the study will be discussed CONFERENCE FEES Panto
* Representatives of the European Commission will be presenting the views of the European Commission. 175 Euro to be paid to Euracs Panto
Lunch & refreshments included
PROGRAM 10.00 - 10.30 Welcome and coffee
10.30 - 12.30 Conference with input form Jung Lichtenberger from the European commission
CANCELLATION POLICY
12.30 - 14.00 Lunch
Cancellations made before 22nd November
14.00 - 15.30 Conference 2010 at 12.00 a.m. will incur no administra-
15.30 - 16.00 Coffee tive charge. Cancellations made after this
16.00 - 17.45 Conference with conclusions deadline will be charged in full.
17.45 Cocktail

CONTACT
WHO The conference’s president is Anne Claes
For more information you may contact :
For the European Commission: Mr. Jung Lichtenberger
Anne Claes
For Esofac and Euracs, the following associates will present the study and discuss the current issues: Esofac Belgium
Giampaolo Crenca, Johnny Cashman, Richard Herrmann, Robert Howkes, Stephen Lalor, Jérôme Tel: +32 2 704 43 12
Louis, Roel Nass, Joop Rietmulder, Karen Vande Sype, Wim Windmolders and Danny Wilding. E-mail: anne.claes@esofac.be
 Registration form for the conference on the “protection
of supplementary pensions in case of insolvency of the
29 / 0

60 / 0

employer for defined benefit and book reserve schemes”

00 / 0

~ A study requested by the European Commission.

HOW Registration can be made by returning this registration form before 15th November 2010
* By post, P.O. Box 166, 5240 AD ROSMALEN, The Netherlands DATE AND LOCATION
* by fax +31 (0) 73 611 12 67 25th November, 2010
Sheraton Brussels National Airport
* by email maxbogaard@euracs.eu
1930 Zaventem

PAYMENT The contribution in costs includes the conference documentation and lunch. Please pay
the amount of 175 Euro before 22nd November 2010 to Euracs: (reference: your name) REGISTRATION
* EURACS, Cheapside House, 138 Cheapside, London EC2V 6BW, United Kingdom Before 15th November
* Bank: HSBC, LONDON, EC2P 2BX, United Kingdom maxbogaard@euracs.eu
* Account Number: 39204467, Sort Code: 40-05-15
* IBAN: GB38 MIDL 4005 1539 2044 67 Panto
CONFERENCE FEES
* BIC: MIDLGB22 Panto
175 Euro to be paid to Euracs
Lunch & refreshments included
Panto

YOUR DETAILS I will attend the joint Esofac and Euracs conference on “the protection of supplementary
pensions” on 25th November 2010
CANCELLATION POLICY
Name: Cancellations made before 22nd November
2010 at 12.00 a.m. will incur no administra-
Title: tive charge. Cancellations made after this
deadline will be charged in full.
Company:

Address: CONTACT
For more information you may contact :
Anne Claes
Signature:
Esofac Belgium
Tel: +32 2 704 43 12
E-mail: anne.claes@esofac.be
Introduction
Article 8 of Directive 2008/94/EC of the European Parliament and of the Council on the protection of
employees in the event of the insolvency of their employer obliges Member States to ensure that the
necessary measures are taken to protect the company sponsored retirement and survivor’s benefits of
employees and ex-employees at the date of the onset of the employer’s insolvency.

All the Member States are facing the social and economic effects of ageing. Many have
launched pension reform strategies giving an increasingly important role to occupa-
tional pension schemes and other forms of privately managed schemes. This has been
made necessary by the growing awareness of declining replacement rates in statutory
systems and the need to prevent a fall in the relative living standards of pensioners.
As a result, many Member States are pursuing policies to increase the funded part of
their pensions systems.
As the number and importance of occupational pension schemes increase across
the EU Member States, the associated economic risks are expected to become more
visible and will raise problems from the perspective of protecting workers’ and pen-
sioners’ rights. Employers’ insolvency is one of those risks.
Indeed, Directive 2003/41/EC of the European Parliament and of the Council of 3
June 2003 on the activities and supervision of institutions for occupational retirement
provisions (IORPs) which aims to coordinate the rules applicable to such institutions,
provides for a very high level of protection of the living standards of beneficiaries of
such schemes and efficient operation of IORPs, particularly where financial invest-
ments and cross-border activities are concerned. According to this directive (Article
16(1)) IORPs must have at all times sufficient and appropriate assets to cover the tech-
nical provisions in respect of the total range of pension schemes operated. However,
temporary underfunding is allowed provided a suitable recovery plan is approved.
The insolvency of a company can occur at a moment when the pension scheme is
underfunded as a result for example of a sharp drop in bond and stock prices or during
the implementation of a recovery plan under Article 16(2).

On 11 April 2008, the Commission presented a Staff working document on imple-
mentation of the abovementioned Article 8. The conclusion of this analysis was that
amongst other further investigation was needed in order to address the following is-
sues:
a) how to protect employees and retired persons against the risk schemes have been examined in detail. The adequacy of solvency rules for IORPs is
of underfunding of the pension schemes, and to what extent;
b) how to deal with cases where the supplementary pensions scheme is
managed by the employer himself.
The study performed on request of the European Commission therefore focuses on
two of the above issues, i.e. the protection of employees and retired persons in case
of insolvency of the employer when the pension scheme is under-funded and when the
pension scheme is managed by the employer himself.
Considering the important role of sponsoring undertakings in the provision of benefits
and the funding of the IORPs, their insolvency presents a particular risk that the inter-
ests of scheme members remain unprotected. Therefore the existing mechanisms of
protection of supplementary pensions in situations of underfunding of defined benefit
currently being examined by the Commission was not the objective of this study.
Furthermore, Directive 2003/41/EC does not apply to companies using book reserve
schemes for the payment of retirement benefits to their employees (Article 2(2)). Since,
in the absence of any special protection mechanism, the insolvency of the employer
presents a high risk for the payment of retirement benefit, the existing mechanisms of
protection of pensions in these situations has been examined in detail. This need is
more acute in the present situation of economic crisis which might result in underfund-
ing of pension schemes and in an increase of companies in insolvency situations.
About ESOFAC Belgium About EURACS
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ESOFAC Belgium consists of a European Actuarial & Consultancy Services
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homogenous group of multilingual (EURACS) is Europe’s oldest network of
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employee benefit specialists from independent actuarial and pensions consultancy
different backgrounds and provides high firms. EURACS was formed in 1982, and grew quickly to
quality advice on all aspects of company sponsored become a network of major actuarial consulting organisa-
employee benefits. tions operating throughout Europe.

ESOFAC Belgium was created in 2005 and consists currently of a partnership of 6
experienced actuaries and pension consultants and one employee.
All ESOFAC partners have many years of experience in advising companies in em-
ployee benefits and actuarial issues. Each partner brings a unique set of skills, such
that ESOFAC can cover a wide range of services including all aspects of employee
benefit consulting required by HR departments, advice to pension funds, actuarial
valuations for accounting objectives or pension funds, calculations and advice need
in case of mergers and acquisitions, communication of employee benefits and inter-
national benefit advice.
The most important element of growth and development of the group is the delivery of
high quality services for clients. ESOFAC aims to provide the best service in relation
to company sponsored benefit plans.
EURACS also enjoys close links with the network North American Actuarial & Consul-
tancy Services (NORACS) which has members across USA, Canada and Mexico. We
also have global correspondents outside of Europe and North America.
The services offered by member firms include:
* Actuarial services for pension funds
* Strategic investment advice for pension funds and other institutional investors
* Strategic pensions consultancy advice for employers
* Actuarial services for insurance companies and life offices
* Advice on the impact of local and international pensions and insurance legislation
* Pensions management, administration and record-keeping
* Mortality analysis and longevity projections
* Legal advice
* IT advice

ESOFAC is a member of the EURACS network. Participation in the EURACS network Pantone 381

enables ESOFAC to provide their clients with professional advice at both international Pantone 575
and local level. This way, ESOFAC can fulfill the needs of the most demanding inter-
Pantone Process Black
national company.

The values of ESOFAC are the best guarantee for result: objective and independent
advice, transparent contracts, continuity and cohesion of an independent group of
specialists. A team offering a full range of services.
 Registration form for the conference on the “protection
of supplementary pensions in case of insolvency of the
29 / 0

60 / 0

employer for defined benefit and book reserve schemes”

00 / 0

~ A study requested by the European Commission.

HOW Registration can be made by returning this registration form before 15th November 2010
* By post, P.O. Box 166, 5240 AD ROSMALEN, The Netherlands DATE AND LOCATION
* by fax +31 (0) 73 611 12 67 25th November, 2010
Sheraton Brussels National Airport
* by email maxbogaard@euracs.eu
1930 Zaventem

PAYMENT The contribution in costs includes the conference documentation and lunch. Please pay
the amount of 175 Euro before 22nd November 2010 to Euracs: (reference: your name) REGISTRATION
* EURACS, Cheapside House, 138 Cheapside, London EC2V 6BW, United Kingdom Before 15th November
* Bank: HSBC, LONDON, EC2P 2BX, United Kingdom maxbogaard@euracs.eu
* Account Number: 39204467, Sort Code: 40-05-15
* IBAN: GB38 MIDL 4005 1539 2044 67 Panto
CONFERENCE FEES
* BIC: MIDLGB22 Panto
175 Euro to be paid to Euracs
Lunch & refreshments included
Panto

YOUR DETAILS I will attend the joint Esofac and Euracs conference on “the protection of supplementary
pensions” on 25th November 2010
CANCELLATION POLICY
Name: Cancellations made before 22nd November
2010 at 12.00 a.m. will incur no administra-
Title: tive charge. Cancellations made after this
deadline will be charged in full.
Company:

Address: CONTACT
For more information you may contact :
Anne Claes
Signature:
Esofac Belgium
Tel: +32 2 704 43 12
E-mail: anne.claes@esofac.be