Regulations, 2015

Suppliment tal-Gazzetta tal-Gvern ta’ Malta, Nru. 19,364, 6 ta’ Jannar, 2015

L.N. 8 of 2015

RETIREMENT PENSIONS ACT

(CAP. 514)

Retirement Pensions (Defined Benefit Retirement Schemes)

Regulations, 2015

IN exercise of the powers conferred by articles 26(1) and

37(1)(i) of the Retirement Pensions Act, the Minister for Finance,

acting on the advice of the Malta Financial Services Authority, has

made the following regulations:-

(1) The title of these regulations is the Retirement Citation and

Pensions (Defined Benefit Retirement Schemes) Regulations, 2015. commencement.

(2) These regulations shall come into force on the 1st January

2015.

(1) Any reference in these regulations to the Act is a Interpretation.

reference to the Retirement Pensions Act and subject to the Cap. 514.

provisions of sub-regulation (2) of this regulation, the provisions of

article 2 of the said Act shall also apply to these regulations.

(2) In these regulations unless the context otherwise requires -

"defined benefit retirement scheme" means a retirement scheme,

other than a defined contribution retirement scheme, which has as its

primary purpose that of providing for the payment of fixed or

determinable retirement benefits;

"technical funding requirement" means a requirement that the

value of the assets of a retirement scheme shall not be

(a)

less than such amount, nor

(b)

more than such amount,

as may be stipulated in terms of Pension Rules issued by the

competent authority.

These regulations shall apply to every defined benefit Applicability of

retirement scheme which is either an occupational retirement scheme regulations.

or a personal retirement scheme, providing cover against biometric

risks or guaranteeing a given level of investment performance or level

of benefits in terms of the Act and any reference to "retirement

scheme" in these regulations shall be construed accordingly.

Every defined benefit retirement scheme shall be subject to

and shall comply with a technical funding requirement as well as with

provisions regarding under-provision or over-provision of the

technical funding requirement established in terms of these

regulations.

(1) In accordance with article 16 of the Act and the

Pension Rules issued thereunder, every defined benefit retirement

scheme shall appoint an actuary approved by the competent authority.

(2) The retirement scheme shall obtain within such period as

stipulated in Pension Rules, an actuarial valuation as set out in the

Pension Rules from the retirement scheme’s actuary and afterwards

obtain such a valuation at such intervals as stipulated in Pension

Rules.

(3) The retirement scheme shall in such circumstances, or on

such dates, or within such periods as stipulated in Pension Rules

obtain a certificate prepared by the retirement scheme’s actuary -

(a)

stating whether or not in his opinion the

contributions payable towards the retirement scheme are

adequate for the purpose of securing that the technical funding

requirement will continue to be met throughout the prescribed

period or, if it appears to him that it is not met, whether or not in

his opinion it will be met by the end of that period; and

(b) indicating any relevant changes that have occurred

since the last actuarial valuation was prepared.

(4) The retirement scheme shall obtain an actuarial valuation

within the period stated in sub-regulation (2)

(a)

in the event that the actuary states in the certificate

referred to in sub-regulation (3), that in his opinion

(i) the contributions payable towards the

retirement scheme are not adequate for the purpose of

securing that the technical funding requirement will

continue to be met throughout the period stipulated in

Pension Rules; or

(ii) the technical funding requirement is not met

at the time of issue of the certificate; or

(iii) it will not be met by the end of that period; or

(b) in such circumstances as may be stipulated in

Pension Rules.

(5) If the retirement scheme obtains a valuation under sub-

regulation (4), it shall do so -

(a)

in the case of a valuation required by paragraph (a)

thereof, within the period of three months or such other period

as may be determined by the competent authority reckoned from

the date of the actuarial certificate, and

(b) in any other case, within such period as may be

stipulated in Pension Rules.

(6) A valuation or certificate shall be prepared in such manner,

give such information and contain such statements as may be

stipulated in Pension Rules.

(1) Where an actuarial valuation shows that, on the Under-provision

effective date of the valuation, the value of the retirement scheme in

scheme.

assets is less than the amount prescribed for the purposes of

paragraph (a) of the definition ''technical funding requirement'' in

regulation 2(2) (the difference shown in the valuation hereinafter

referred to as ''the shortfall'') the employer or contributor shall -

(a)

by making an appropriate payment to the retirement

scheme; or

(b) by such other method as may be stipulated in

Pension Rules,

secure an increase in the value of the retirement scheme assets which,

taken with any contributions paid, is not less than the shortfall.

(2) The required increase in that value must be secured -

(a) before the end of such period as may be stipulated in

Pension Rules reckoned from the date of the valuation; or

(b) if the actuarial valuation was obtained by reason of a

statement in the certificate referred to in regulation 5(3), before

the end of a period stipulated in Pension Rules reckoned from

the date of the certificate.

(3) Except in such circumstances as may be stipulated in

Pension Rules, if the employer or contributor referred to in sub-

regulation (1) fail to secure the required increase in value before the

end of the period applicable under sub-regulation (2), the retirement

scheme administrator, or the retirement scheme actuary shall within

the period of thirty days reckoned from the end of that period, give

written notice of that fact to the competent authority, members and

beneficiaries of the retirement scheme.

(4) Except in such circumstances as may be stipulated in

Pension Rules, if the employer referred to in sub-regulation (1) fails

to secure the required increase in value before the end of the period

applicable under sub-regulation (2), then so much of the shortfall as,

at any subsequent time, has not been met by an increase in value

made under sub-regulation (1) or otherwise by contributions made

before the end of that period, such shortfall shall be recoverable by

the retirement scheme from the employer and the provisions of article

19(5) of the Act shall mutatis mutandis apply with regard to any such

debt; and, in the case of a personal retirement scheme, such amounts

shall be recoverable from the contributor.

(5) The competent authority may extend, or further extend the

period referred to in sub-regulation (2), and where it refuses to extend

or further extend the period, it shall give written notice to the

retirement scheme of the refusal together with a statement of reasons

for its decision.

(1) Where an actuarial valuation shows that, on the

effective date of the valuation, the value of the retirement scheme

assets is more than the amount prescribed for the purposes of

paragraph (b) of the definition ''technical funding requirement'' in

regulation 2(2) (the difference shown in the valuation hereinafter

referred to as ''the excess''), the competent authority may issue a

directive to the employer or contributor and the retirement scheme to

take such steps by such method as may be approved by the competent

authority to secure an appropriate reduction in the value of the

retirement scheme assets.

(2) The required reduction in that value must be secured

before the end of such period as may be specified in the directive.

(3) If the employer or contributor and retirement scheme fail

to secure the required reduction in value before the end of the period

applicable under sub-regulation (2), the retirement scheme shall,

within the period of thirty days reckoned from the end of that period,

give written notice of that fact to the competent authority, members

and beneficiaries of the retirement scheme.

(4) The competent authority may extend, or further extend the

period referred to in sub-regulation (2), and where it refuses to

extend, or further extend the period, it shall give written notice to the

retirement scheme of the refusal together with a statement of reasons

for the decision.

(1) A schedule of payments shall be prepared by the Requirement for

retirement scheme before the end of such period as may be stipulated a payments.

in Pension Rules, reckoned from the date of the first actuarial

valuation for the retirement scheme, and shall thereafter be revised

before the end of such period as may be prescribed, reckoned from

the date of the signing of each subsequent actuarial valuation.

(2) Where from time to time, such revisions are agreed by the

retirement scheme and the employer or contributor, and where

applicable, any other contributor to the retirement scheme, and any

such revision in the rates of contributions is certified by the actuary of

the retirement scheme as meeting the requirements of the Act, or as

may be prescribed or in the circumstances referred to in paragraph (b)

of sub-regulation (3), the schedule of payments may be revised.

(3) The matters contained in the schedule of payments as

revised shall be

(a)

matters previously agreed between the retirement

scheme and the employer, and where applicable, any other

contributor to the retirement scheme, or

(b)

where no such agreement has been reached

(i) the rates of contributions determined by the

retirement scheme and the actuary of the retirement

scheme and certified by the actuary of the retirement

scheme, being such rates as in their opinion are adequate

for the purpose of securing that the technical funding

requirement will continue to be met throughout the

prescribed period or where it appears to them that the

technical funding requirement is not being met, such rates

as are adequate for such requirement to be met by the end

of that period; and

(ii) any other matters determined by the

retirement scheme and the actuary of the retirement

scheme.

(4) An agreement for the purposes of paragraph (a) of sub-

regulation (3) shall be made during such period as may be stipulated

in Pension Rules, beginning with the signing of the last preceding

actuarial valuation for the retirement scheme.

(5) The actuary shall not certify the schedule of payments -

(a)

where it appears to him that the technical funding

requirement is met, unless he is of the opinion that the rates are

adequate for the purpose of securing that the requirement will

continue to be met throughout the period stipulated in Pension

Rules, and

(b) in any other case, unless he is of the opinion that the

rates are adequate for the purpose of securing that the

requirement will be met by the end of that period.

(6) The competent authority may extend, or further extend the

period referred to in sub-regulation (1), and where it refuses to

extend, or further extend such period, it shall give written notice to

the retirement scheme of the refusal together with a statement of

reasons for the decisions.

The competent authority may from time to time issue

Pension Rules in terms of article 37(4) of the Act for the better

carrying out of the provisions of these regulations.

€0.27