The Guernsey pension industry makes up a significant part of the island's finance sector, with a number of experienced pension providers offering a broad range of pension products, including domestic occupational pension schemes, international pension schemes for non-residents and personal pension schemes.
Whilst acting as trustee or administrator of a pension scheme (if acting by way of business) is regulated under the existing legislation that regulates fiduciaries generally, perhaps surprisingly there has never been a regulatory regime specifically designed for pension providers or pension schemes (other than the Retirement Annuity Trust Schemes Rules, 2015 applicable to Guernsey retirement annuity trust schemes).
The current law relating to Guernsey pensions is limited to the relevant provisions of the Income Tax (Guernsey) Law, 1975 (as amended) which deals with the approval of occupational pension schemes (under section 150) and personal pension schemes (under sections 157A and 157E) and the recognition of international occupational and personal pension schemes (under sections 40(o) and 40(ee)) for Guernsey income tax purposes, together with certain basic requirements for approval or recognition. However, other than the submission of individual tax returns and notification in the event of changes to the scheme documents of occupational and personal schemes, there are no ongoing reporting requirements. The existing statutory provisions do not (and were never intended to) deal with matters such as the conduct of business of pension providers or their relationship with members and beneficiaries, or the administration of pension schemes themselves.
That is set to change from 30 June 2017 when a new pensions regulatory regime is to be introduced. The new regime will apply to all Guernsey pension providers (other than 'lay' persons) and to the Guernsey pension schemes that they form, manage or administer, which will be regulated by the Guernsey Financial Services Commission (the GFSC), the regulator of the island's fiduciary, investment, insurance and banking industries.
The proposed changes are subject to industry consultation, which closed on 5 June 2017, so the precise details may change, although it is expected that the principal proposals will be introduced. This note is based on the proposals put to industry in the consultation document and will be updated when the details have been finalised.