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Pan-European pension plan proposed

A harmonised legal framework is needed to encourage EU citizens to save for retirement through a pan-European pension product, the European Insurance and Occupational Pensions Authority (EIOPA) said.09 Jul 2015

EIOPA has published a consultation paper on the creation of a Europe-wide personalised pension product (PEPP).

Harmonised rules would ensure a level playing field for all providers, remove barriers to cross-border business, and allow an approach combining state, workplace and personal pensions, EIOPA said.  

"Benefits could be expected both for providers of PEPPs (mainly through the possibility to target wide sections of the European working population with the same pension products) and for individuals (the standardisation of PEPPs would allow cost-effectiveness and the availability of value-for-money products)," EIOPA said.

EIOPA believes that personal retirement savings products should be clearly distinguished from regular financial products, and proposes the establishment of a stand-alone authorisation regime for PEPP providers. This regime would ensure that those providers not already authorised and regulated under an existing EU directive do not fall through the 'authorisation gap', it said.

A PEPP product 'passport' showing that a product has been registered and approved in its home state could be used to remove any barriers to cross-border marketing of products, EIOPA said.

Supervisory bodies would need to be put in place to supervise providers, with close cooperation between national authorities, it said. 

The deadline for comments on the consultation paper is 5 October 2015.

The consultation paper follows a discussion paper published in May 2013 and a preliminary report in February 2014.

In February EIOPA warned that consumers who buy insurance and pensions products online are at risk because they often do not do enough research and may sign up to contracts without knowing it.