FEDERAL REG

SOR/2016-309: Regulations Amending the Pooled Registered Pension Plans Regulations

REGISTRATION OF FEDERAL REGULATION - VIA OIC DATABASE, PRIOR TO PART II OF THE GAZETTE

Registered
December 2, 2016


REGULATORY IMPACT ANALYSIS STATEMENT (This statement is not part of the Regulations.) Issues The federal Pooled Registered Pension Plans Act (PRPP Act) applies to PRPPs that are linked to employment that falls under federal jurisdiction. Areas of employment that fall under federal jurisdiction include work in connection with navigation and shipping, banking, inter-provincial transportation and co... (Click for more)


Published on December 2, 2016

Bill Summary

SOR/2016-309: Regulations Amending the Pooled Registered Pension Plans Regulations

REGULATORY IMPACT ANALYSIS STATEMENT (This statement is not part of the Regulations.) Issues The federal Pooled Registered Pension Plans Act (PRPP Act) applies to PRPPs that are linked to employment that falls under federal jurisdiction. Areas of employment that fall under federal jurisdiction include work in connection with navigation and shipping, banking, inter-provincial transportation and communications, and any work in the Yukon, Northwest Territories or Nunavut. A PRPP is administered by a corporation that holds a PRPP administrator licence. The Office of the Superintendent of Financial Institutions (OSFI) is responsible for supervising federally registered PRPPs. Self-employed individuals and employers in provincially regulated sectors may also join a PRPP if their respective province has PRPP legislation in place. British Columbia, Alberta, Saskatchewan, Ontario and Nova Scotia have passed PRPP legislation. Quebec has passed similar legislation called the Voluntary Retirement Savings Plans Act (VRSP). Provincial pension supervisors would normally supervise the aspects of multi-jurisdictional PRPPs that relate to members in provincially regulated employment areas, and a single PRPP may be offered by employers in multiple jurisdictions. In order to streamline the regulation and supervision of multi-jurisdictional PRPPs, section 6 of the PRPP Act allows the Minister of Finance to enter into a multilateral agreement concerning multi-jurisdictional PRPPs with provinces that have in force similar legislation. Under this authority, the federal government and several provinces negotiated the Multilateral Agreement Respecting Pooled Registered Pension Plans and Voluntary Retirement Savings Plans. Regulations are required to designate the provinces with whom the Minister of Finance can enter into the agreement, and to identify their respective supervisory authorities. The PRPP legislation of some provinces includes similar provisions. The Pooled Registered Pension Plan Regulations (PRPP Regulations) were brought into force on December 14, 2012. They were amended on June 3, 2016, in order to designate the provinces — and their respective pension supervisory authorities — that had PRPP legislation in force at the time and with whom the Minister could sign a multilateral agreement. Effective June 15, 2016, the Minister of Finance entered into the Multilateral Agreement Respecting Pooled Registered Pension Plans and Voluntary Retirement Savings Plans with the Governments of British Columbia, Saskatchewan, Quebec and Nova Scotia. Other provinces that adopt PRPP legislation similar to the federal PRPP Act are also able to join the agreement; however, the PRPP Regulations must be amended to designate them and their pension supervisory authority. Ontario’s PRPP legislation is now in force and the province wishes to join the Multilateral Agreement Respecting Pooled Registered Pension Plans and Voluntary Retirement Savings Plans. In order to be able to enter into the agreement with the federal government, Ontario and its pension supervisory authority need to be designated in the PRPP Regulations. Objectives The objective of this regulatory amendment is to designate Ontario as a province with whom the Minister of Finance may enter into the Multilateral Agreement Respecting Pooled Registered Pension Plans and Voluntary Retirement Savings Plans, as well as Ontario’s pension supervisory authority. Description The Regulations Amending the Pooled Registered Pension Plans Regulations (the Regulations) designate Ontario as a province that has legislation in force similar to the federal PRPP Act. The Regulations also designate Ontario’s pension supervisory authority, the Superintendent of Financial Services of Ontario. “One-for-One” Rule The “One-for-One” Rule does not apply, as the amendments do not affect administrative costs to business. Small business lens The small business lens does not apply, as the amendments do not impose costs on small business. Consultation The Government of Ontario and the governments of British Columbia, Saskatchewan, Quebec and Nova Scotia, who are parties of the agreement, and the Office of the Superintendent of Financial Institutions were consulted on the Regulations and they are supportive of them. Rationale The PRPP Act requires participating provinces and their respective pension supervisory authorities to be designated by regulation in order to provide the Minister of Finance with the authority to enter into a multilateral agreement. The amendments will permit Ontario to join the Multilateral Agreement Respecting Pooled Registered Pension Plans and Voluntary Retirement Savings Plans, which will enable further streamlining of supervision, supporting the creation of large multi-jurisdictional PRPPs, thereby generating economies of scale that will result in lower administration fees for PRPP members. An Order in Council is being issued to allow the Minister of Finance to enter into the agreement with Ontario, as the province is ready to become a party to it. These amendments will not result in incremental costs for Canadians, businesses or the Government. Expanding the number of provinces participating in the agreement will facilitate the creation of large PRPPs with members across multiple jurisdictions, thereby increasing the number of Canadians with workplace pension plans and generating economies of scale and reducing costs. Contact Lisa Pezzack Director Financial Systems Division Department of Finance 90 Elgin Street, 13th Floor Ottawa, Ontario K1A 0G5 Email: [email protected] Footnote a S.C. 2012, c.16 Footnote 1 SOR/2012-294

This Bill does not amend any statutes.

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