Explanatory note

These Regulations are made under section 2(2) of the European Communities Act 1972 (c. 68) and implement paragraph (c) of Article 16.2 of the European Union Directive 2003/41/EC on the activities and supervision of institutions for occupational retirement provision (OJ No. L 235, 23.9.03, p.10) (“the Directive”).

Regulation 2 inserts new section 231A into the Pensions Act 2004 (c. 35) (“the 2004 Act”). Subsection (1) of the new section 231A provides that the trustees or managers of a scheme must prepare a winding up procedure as soon as reasonably practicable after a scheme begins to wind up during the recovery period. The “recovery period” is defined as the period specified in the scheme’s recovery plan in accordance with section 226(2)(b) of the 2004 Act (new section 231A(8)). The winding up procedure must include specified information (new section 231A(2)). The trustees or managers must send a copy of the winding up procedure to the Pensions Regulator as soon as reasonably practicable after it has been prepared or revised (new section 231A(6)). New section 213A(7) provides that penalties under section 10 of the Pensions Act 1995 (c. 26) apply to a trustee or manager who has failed to take all reasonable steps to ensure compliance with the requirements of section 231A of the 2004 Act.

Regulation 3 amends the Occupational Pension Schemes (Disclosure of Information) Regulations 1996 (S.I. 1996/1655) to require the trustees or managers of a scheme to disclose an outline of the winding up procedure to the members of the scheme and their representatives.

Regulation 4 amends the Register of Occupational and Personal Pension Schemes Regulations 2005 (S.I. 2005/597) to prescribe that where a scheme begins to wind up during the recovery period, the date the winding up of the scheme commenced is registrable information for the purposes of section 60(2)(h) of the 2004 Act.

Regulation 5 amends the Occupational Pension Schemes (Scheme Funding) Regulations 2005 (S.I. 2005/3377) and removes the disclosure provision in regulation 8 as a consequence of regulation 5 of these Regulations. It also amends regulation 17 enabling section 231A of the 2004 Act to apply to a scheme in respect of which a recovery plan has been prepared under section 226 of that Act and the scheme begins to wind up during the recovery period.

These Regulations have only a negligible impact on business. Publication of a full Regulatory Impact Assessment is not necessary for such legislation. Copies of a transposition note concerning the implementation of the Directive by these Regulations may be obtained from Private Pensions, Department for Work and Pensions, 3rd floor, Adelphi, 1-11 John Adam Street, London WC2N 6HT.