How is responsibility for supervising pooled registered pension plans shared between OSFI and provincial regulators?
Federal and provincial PRPP legislation and legislation covering voluntary retirement savings plans in Quebec authorize governments to enter into an agreement to streamline the regulation and supervision of PRPPs across the country. In June 2016, the Governments of Canada, British Columbia, Saskatchewan, Québec and Nova Scotia entered into the Multilateral Agreement Respecting Pooled Registered Pension Plans and Voluntary Retirement Saving Plans (the Multilateral Agreement). Other provincial governments may sign the multilateral agreement in the future once they have PRPP legislation in place.
The Multilateral Agreement streamlines the licensing of administrators, PRPP registration, the laws applicable to PRPPs, and PRPP supervision.
The Multilateral Agreement provides that a corporation that is authorized to act as an administrator of a voluntary retirement savings plan (VRSP) can apply to register a federal PRPP with OSFI without needing to obtain a PRPP administrator licence under the federal PRPP Act. In addition, a federally licensed PRPP administrator or an authorized VRSP administrator is exempt from having to obtain a licence under applicable provincial PRPP legislation.
The Multilateral Agreement also provides that, except in Quebec, a federally licensed administrator that registers a PRPP under the federal PRPP Act is exempt from the requirement to register that PRPP under applicable provincial PRPP legislation. As a result, federally registered PRPPs can, in addition to accepting members whose employment falls under federal jurisdiction, accept members whose employment falls under the jurisdiction of any province (other than Quebec) that is a party to the Multilateral Agreement. Employees and self-employed persons whose employment is subject to Quebec’s jurisdiction would join a VRSP registered and supervised by Retraite Quebec.
As a result of the Multilateral Agreement, the provisions of the federal PRPP Act apply to all federally registered PRPPs that include members from different jurisdictions instead of the provisions of a provincial PRPP Act, subject to certain exceptions. For example, the federal rules relating to plan-wide matters, such as investments, providing a PRPP at a low cost to members, and communications with members, apply. The exceptions include provisions that impact provincial members’ individual benefits, such as locking-in requirements and the types of savings vehicles into which funds in a PRPP account may be transferred.
Under the Multilateral Agreement, OSFI is responsible for supervising all federally registered PRPPs that include members of jurisdictions that are subject to that agreement.