Europe can benefit from the achievements of the Dutch mature pension industry.
With the implementation of the European Pension Fund directive– part of the Pension Act that entered into force on 1 January 2007 – it became possible for the pension industry to launch pension schemes on a European level from any EU member state, subject to the regulations applicable in the home country of the pension sponsor.
The claims of these EU member states are based – by Dutch standards – on optimistic returns and minimal solvency guidelines. In the event of undercoverage, the supervisory institution will request that the sponsor of the pension fund make supplementary payments to offset the shortfall. This “Trojan” attractiveness may well become a millstone around the sponsor’s neck in less prosperous times – not what you would expect from an attractive place of establishment.
Europe can benefit from the achievements of the Dutch mature pension industry, including:
• Additional return as a result of the extensive Dutch treaty network with approximately 80 treaties to prevent double taxation;
• Opportunity to choose different legal forms;
• Complete exemption from corporation tax;
• Efficient solutions for ring-fencing and pension pooling based on extensive experience with Contractual Funds (FGR – Fondsen voor Gemene Rekening) and related Asset Pooling;
• Short and direct lines between the pension fund industry and the government;
• Strongly developed financial advice sector.