Pensions Weekly Update – 5 June 2024

June 2024
Region: Europe

Here is our weekly summary of key legal and regulatory developments relevant to occupational pension schemes that you might have missed, with links for further information.

  • The Pensions Policy Institute (PPI) has said that it will be publishing a series of papers in the run up to the 2024 general election, which will set out some of the policy areas that are likely to receive active discussion during the election campaign. The first paper in this series looks at the pensions triple lock.
  • HM Revenue and Customs (HMRC) has published newsletter 160. The newsletter includes information on the transitional tax-free amount certificates in connection with the abolition of the lifetime allowance, more information on the lifetime allowance, lump sums and reporting requirements, a reminder that this is the last year that pension scheme returns can be submitted using the Pension Schemes Online service and a new process for contacting HMRC.
  • As a result of the UK leaving the EU, it lost the automatic right from 31 December 2020 to reciprocal recognition and enforcement of judgment arrangements with the EU. This meant that pension trustees with a contingent asset guarantee given by an EU guarantor could have found it more difficult to enforce that guarantee against the EU guarantor. The UK became a party to the 2005 Hague Convention in January 2021, which provided some protection for contracts (and guarantees) executed with an exclusive jurisdiction clause. Broadly speaking, an exclusive jurisdiction clause is one where the agreement states which jurisdiction will hear any disputes in relation to the agreement. The Hague Convention 2019, which came into force in September 2023, fills in some of the gaps and extends protection to contracts (and guarantees) executed with non-exclusive jurisdiction clauses, although the 2019 convention does contain limitations and restrictions. The UK signed up to this convention in January 2024 and has now published regulations implementing the convention with effect from when the UK officially becomes a contracting party to the 2019 convention (which is expected to be during 2025). Most PPF guarantees contain non-exclusive jurisdiction clauses (unless they were re-executed post-Brexit to take advantage of the 2005 convention coverage), so this development should provide welcome comfort for trustees of pension schemes with EU resident guarantors. If you have any questions about the enforceability of any guarantee or contract, please seek legal advice.
  • Are you up to speed on the enhanced powers that the Pension Schemes Act 2021 introduced for The Pensions Regulator (TPR)? Do you know the circumstances in which TPR could issue a financial penalty of up to £1 million? We have produced a #how2dopensions quick guide as a useful refresher.
  • Look out for our Summer Hot Topics in Pensions, which highlights 10 key issues for your trustee or corporate agendas. Our publication embraces a theme of summer sporting events. Anyone for tennis?

If you would like specific advice on any of these issues or anything else, please contact a member of our Pensions team.

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