The Ministers of Finance and Social Affairs and Employment have submitted a bill to Parliament on the introduction and supervision of Premium Pension Institutions (PPI)14.
The PPI is a pension vehicle which can operate on the Dutch market, but it is primarily intended as a vehicle for activities in other European Union member states. Although the PPI can administer pension schemes, it may not bear any risk or promise any guaranteed returns on investment. This makes the PPI pre-eminently suitable for Defined Contribution arrangements, where the premium contribution is fixed but the amount of the final pension is not.
The proposed bill is the result of lengthy discussions regarding the modernisation of the Dutch pension system and the adaptation of pension legislation to the development of a European pension market. There is a European Directive15 which makes cross-border activities possible for providers of pension schemes. This bill is the first phase of the legislative process regarding the introduction of the General Pension Institution (Algemene Pensioeninstelling), which may also administer the Defined Benefit arrangements (and bear risk insurance-technically). The second phase will deal with effecting cooperation between company pension funds and the third phase with how a General Pension Institution can be introduced in the Pension Act (Pensioenwet).
This bill amends other acts, including the FMSA and the Pension Act, and is intended to enter into force in December 2009.