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Such a move would also undermine a campaign by Britain and the Netherlands, both fighting hard to get the proposals scrapped. The concern taps into wider anxieties that, with the European Commission having put forward almost 30 financial services regulations since 2009, European Union Member States will vote in favour of rule changes that would damage them, just to keep in with perceived political allies.
Germany’s VFPK, the country’s association of corporate pension funds, which represents the pension schemes of more than 4,200 companies and almost 1.5 million employees and pensioners, said it rejected the idea of forcing pension schemes to adopt provisions of the Solvency II Directive for insurance companies.
The proposals, put forward last year in a consultation paper by the European Insurance and Occupational Pensions Authority, would oblige the companies that sponsor pension schemes to contribute an extra 30 per cent to 40 per cent top-up of the scheme assets, the VFPK estimates.
A spokesman for the VFPK said: “The application of the requirements of Solvency II would make company pension plans cost-prohibitive for employees and employers. The consequence will be employers withdrawing from funded occupational pensions.”
This adds the German pensions industry to the list of opponents to the proposed changes to pensions regulations, which already includes the UK and the Netherlands. It is potentially a significant development, because the combined votes of the UK, Germany and the Netherlands in the European Council of Ministers would be almost enough to block the proposal.
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