The Regulation on a Pan-European Personal Pension Product (“PEPP”) deals with the registration, manufacturing, distribution and supervision of PEPP. It was adopted and published in the Official Journal of the EU in July 2019. It is directly applicable and started to apply on 22 March 2022. BIPAR and its member associations have been very active on this file all along the legislative process.

PEPP is an optional, 2nd regime instrument, complementary to the existing state-based (pillar 1), occupational (pillar 2) and national personal pensions (pillar 3) and has standardised key product features.

PEPP can be distributed by insurance intermediaries offering insurance under IDD and investment firms providing advice under MiFID II. Some specific PEPP rules also apply to all kinds of distributors. Under the existing Regulation, all PEPP providers have to offer “Basic PEPPs” (“simple and affordable default investment options”) that have to provide capital protection and where costs and fees shall not exceed 1 % of the accumulated capital per year (this includes (initial) advice costs).

The current Regulation foresees mandatory advice (with a suitability test) and a demand and needs test for PEPP providers and distributors, for all PEPPs, including Basic PEPPs.

For a variety of reasons, PEPP has however not been successful. At the time of writing this article, two providers are offering a PEPP, one in in Austria, Cyprus, Czechia, Ireland, the Netherlands, and Poland, and the other one in Czechia, Croatia, Poland and Slovakia, according to the EIOPA central database that contains information on all PEPPs in Europe.

In December 2016, the Directive on the activities and supervision of Institutions for Occupational Retirement Provision (IORP II) was adopted. It entered into force in January 2017 and Member States had until 13 January 2019 to transpose it into national law. Many Member States were late in their transposition.

Occupational pension funds or IORPs are financial institutions which manage collective retirement schemes for employers in order to provide retirement benefits to their employees. Occupational pensions, which include an employer contribution, are known as the "second pillar" of pension systems.

The IORP II Directive aims to ensure the soundness of occupational pensions, to better inform pension scheme members and beneficiaries with a standardised “Pension Benefit Statement” at EU level, to promote cross-border activity and to help long-term investment by encouraging occupational pension funds to invest in long-term growth-, environment- and employment-enhancing economic activities. It does not concern issues of national social, labour, tax or contract law, or the adequacy of pension provision in Member States. 

In parallel to its work on the review of the PEPP and IORP frameworks, the European Commission also consulted on and published non-legally binding measures related to pensions (BIPAR also responded to these parts of the consultations).

Indeed, the public consultations already mentioned in the PEPP and IORP articles also dealt with:

- Pension Tracking Systems ((PTS), which aim to provide a complete picture of the entitlements from the various types of pension schemes), where the EC sought views on the coverage and design features.

- Pension dashboards (which show country‑wide information on pensions with the objective to highlight gaps in sustainability and their adequacy at aggregate level, and to enable Member States to deploy necessary policy intervention).

- Auto-enrolment where the EC looked at the role of auto-enrolment and whether Member States should encourage the use of auto‑enrolment to nudge future pensioners in allocating part of their income (or savings) into a supplementary pension scheme.