The Pension Protection Fund (Entry Rules) Regulations 2005

Citation, commencement and interpretation E+W+S

1.—(1) These Regulations may be cited as the Pension Protection Fund (Entry Rules) Regulations 2005.

(2) These Regulations shall come into force—

(a) for the purposes of regulation 1 (except paragraphs (4) and (5)) and regulation 2, on 1st April 2005; and

(b) for all other purposes on 6th April 2005.

(3) In these Regulations—

“the Act” means the Pensions Act 2004;

M1 “the 1986 Act” means the Insolvency Act 1986;

M2 “the 1988 Act” means the Income and Corporation Taxes Act 1988;

M3 “the 1993 Act” means the Pension Schemes Act 1993;

M4 “the 1995 Act” means the Pensions Act 1995;

M5 “the FSMA” means the Financial Services and Markets Act 2000;

[F1 “the assessment date” means the date on which the assessment period in relation to the scheme or section, or (where there has been more than one such assessment period) the last one, began;]

M6 “the Authority” has the meaning given in section 124(1) of the 1995 Act (interpretation);

[F2 “EEA credit institution” means a credit institution, authorised under Directive 2006/48/EC of the European Parliament and of the Council dated 14th June 2006 relating to the taking up and pursuit of the business of credit institutions, [F3 as last amended by Directive 2009/111/EC of the European Parliament and of the Council,] which has its relevant office in an EEA state other than the United Kingdom;

“EEA insurer” means an undertaking, other than a UK insurer, pursuing the activity of direct insurance (within the meaning of Article 2 of the life insurance directive or Article 1 of the first non-life insurance directive) which has received authorisation under Article 4 of the life insurance directive or Article 6 of the first non-life insurance directive from its home state regulator;

“EEA regulator” means a competent authority (within the meaning of Article 1(1) of the life insurance directive or Article 1(k) of the third non-life insurance directive) of an EEA state;

“the first non-life insurance directive” means Council Directive 73/239/EEC of 24th July 1973 on the co-ordination of laws, regulations and administrative provisions relating to the taking up and pursuit of the business of direct insurance other than life assurance;

“home state regulator” means the relevant EEA regulator in the EEA state where its head office is located;]

M7 “the Insolvency Rules” means the Insolvency Rules 1986;

[F4 “the life insurance directive” means Directive 2002/83/EC of the European Parliament and of the Council dated 5th November 2002 concerning life assurance;]

[F5 “the Multi-employer Regulations” means the Pension Protection Fund (Multi-employer Schemes) (Modification) Regulations 2005;]

“multi-employer scheme” has the meaning given in section 307(4) of the Act (modification of the Act in relation to certain categories of pension scheme);

“multi-employer section” means a section of a segregated scheme which has at least two employers in relation to that section;

“non-segregated scheme” means a multi-employer scheme which is not a segregated scheme;

“normal pension age” has the meaning given in section 138(11) of the Act (payment of scheme benefits);

“pensionable service” has the meaning given in section 70(2) of the 1993 Act (interpretation);

“public body” means a government department or any non-departmental public body established by an Act of Parliament or by a statutory instrument made under an Act of Parliament to perform functions conferred on it under or by virtue of that Act or instrument or any other Act or instrument;

[F6 “relevant office” means—

(a)

in relation to a body corporate, its registered office or, if it has no registered office, its head office;

(b)

in relation to a person other than a body corporate, the person’s head office;]

“relevant public authority” has the meaning given in section 307(4) of the Act;

“restricted information” has the meaning given in section 197(4) of the Act (restricted information);

“segregated scheme” means a multi-employer scheme which is divided into two or more sections where—

(a)

any contributions payable to the scheme by an employer in relation to the scheme or by a member are allocated to that employer's or that member's section; and

(b)

a specified proportion of the assets of the scheme is attributable to each section of the scheme and cannot be used for the purposes of any other section;

“segregated part”—

(a)

in relation to a non-segregated scheme, means a part of the scheme which is created when the rules of the scheme require the trustees or managers, in circumstances where an employer in relation to the scheme ceases to participate in the scheme, to segregate such part of the assets of the scheme as is attributable to the liabilities of the scheme to provide pensions or other benefits to or in respect of the pensionable service of members of the scheme by reference to that employer; and

(b)

in relation to a multi-employer section of a segregated scheme, means a part of the section which is created when the rules of the scheme relating to that section require the trustees or managers of the section, in circumstances where an employer in relation to the section ceases to participate in the scheme, to segregate such part of the assets of the section as is attributable to the liabilities of the section to provide pensions or other benefits to or in respect of the pensionable service of members of the section by reference to that employer; and

[F7 “tax registered scheme” means a pension scheme which is registered under Chapter 2 of Part 4 of the Finance Act 2004 (registration of pension schemes).]

[F8 “the third non-life insurance directive” means Council Directive 92/49/EEC of 18th June 1992 on the co-ordination of laws, regulations and administrative provisions relating to direct insurance other than life assurance and amending Directives 73/239/EEC and 88/357/EEC;

“UK insurer” means a person who has permission under Part 4 of the FSMA to effect or carry out contracts of insurance, but does not include a person who, in accordance with that permission, carries on that activity exclusively in relation to reinsurance contracts.]

[F9 (4) In Part 2 of the Act and these Regulations, “employer”, in relation to—

(a) an occupational pension scheme which is not a multi-employer scheme; or

(b) a single-employer section of a segregated scheme,

which has no active members, includes the person who was the employer of persons in the description of employment to which the scheme or section relates immediately before the time at which the scheme or section ceased to have any active members in relation to it.]

[F10 (5) In these Regulations, “employer”, in relation to a non-segregated scheme or a multi-employer section of a segregated scheme—

(a) in an assessment period, includes any person who before the assessment date has ceased to be the employer of persons in the description of employment to which the scheme or section relates unless condition A, B, [F11 C, [F12 D, E or F]] is satisfied where—

(i) condition A is that a debt under section 75 of the 1995 Act became due from that employer and the full amount of the debt has been paid before the assessment date;

(ii) condition B is that—

(aa) such a debt became due;

(bb) a legally enforceable agreement has been entered into the effect of which is to reduce the amount which may be recovered in respect of the debt; and

(cc) the reduced amount has been paid in full before the assessment date;

(iii) condition C is that such a debt became due but before the assessment date it is excluded from the value of the assets of the scheme or section because it is unlikely to be recovered without disproportionate costs or within a reasonable time;

(iv) condition D is that at the time at which any such person ceased to be the employer of persons in the description of employment to which the scheme or section relates the value of the assets of the scheme or section was such that no such debt was treated as becoming due;

[F13 (v) condition E is that—

(aa) there is a restructuring within regulation 6ZB or 6ZC of the Occupational Pension Schemes (Employer Debt) Regulations 2005 (employment-cessation events: exemptions);

(bb) in that restructuring, the employer was the exiting employer for the purposes of those Regulations (see the definition of “exiting employer” in regulation 2(3A) of those Regulations (interpretation)); and

(cc) regulation 6ZA(3) or (4) of those Regulations (employment-cessation events: general) does not apply in relation to that restructuring;]

[F14 (vi) condition F is that a flexible apportionment arrangement has taken effect in accordance with regulation 6E of the Occupational Pension Schemes (Employer Debt) Regulations 2005 (flexible apportionment arrangements) where the employer was the leaving employer within the meaning given in paragraph (7) of that regulation;]

(b) in any other case, includes any person who has ceased to be the employer of persons in the description of employment to which the scheme or section relates unless condition A, B, [F15 C, [F16 D, E or F]] is satisfied where—

(i) condition A is that a debt under section 75 of the 1995 Act became due from that employer and the full amount of the debt has been paid;

(ii) condition B is that—

(aa) such a debt became due;

(bb) a legally enforceable agreement has been entered into the effect of which is to reduce the amount which may be recovered in respect of the debt; and

(cc) the reduced amount has been paid in full;

(iii) condition C is that such a debt became due but it is excluded from the value of the assets of the scheme or section because it is unlikely to be recovered without disproportionate costs or within a reasonable time;

(iv) condition D is that at the time at which any such person ceased to be the employer of persons in the description of employment to which the scheme or section relates the value of the assets of the scheme or section was such that no such debt was treated as becoming due.]

[F17 (v) condition E is that—

(aa) there is a restructuring within regulation 6ZB or 6ZC of the Occupational Pension Schemes (Employer Debt) Regulations 2005 (employment-cessation events: exemptions);

(bb) in that restructuring, the employer was the exiting employer for the purposes of those Regulations (see the definition of “exiting employer” in regulation 2(3A) of those Regulations (interpretation)); and

(cc) regulation 6ZA(3) or (4) of those Regulations (employment-cessation events: general) does not apply in relation to that restructuring.]

[F18 (vi) condition F is that a flexible apportionment arrangement has taken effect in accordance with regulation 6E of the Occupational Pension Schemes (Employer Debt) Regulations 2005 where the employer was the leaving employer within the meaning given in paragraph (7) of that regulation.]

[F19 (6) Until 30th April 2011, amendments made to Directive 2006/48/EC of the European Parliament and of the Council by Directive 2009/110/EC of the European Parliament and of the Council shall be disregarded for the purposes of the definition of “EEA credit institution” in paragraph (3).]

Textual Amendments

F1 Words in reg. 1(3) inserted (19.8.2005) by The Occupational Pension Schemes (Miscellaneous Amendments) Regulations 2005 (S.I. 2005/2113), regs. 1(1), 4(1)(2)(b)

F2 Words in reg. 1(3) inserted (1.4.2009) by The Pension Protection Fund (Miscellaneous Amendments) Regulations 2009 (S.I. 2009/451), regs. 1, 2(2)(a)

F3 Words in reg. 1(3) inserted (31.12.2010) by The Capital Requirements (Amendment) Regulations 2010 (S.I. 2010/2628), reg. 1, Sch. 2 para. 7

F4 Words in reg. 1(3) inserted (1.4.2009) by The Pension Protection Fund (Miscellaneous Amendments) Regulations 2009 (S.I. 2009/451), regs. 1, 2(2)(b)

F5 Words in reg. 1(3) inserted (24.8.2005) by The Pension Protection Fund (Entry Rules) Amendment Regulations 2005 (S.I. 2005/2153), regs. 1(1), 2(2)

F6 Words in reg. 1(3) inserted (1.4.2009) by The Pension Protection Fund (Miscellaneous Amendments) Regulations 2009 (S.I. 2009/451), regs. 1, 2(2)(c)

F7 Words in reg. 1(3) substituted (6.4.2006) by The Pension Protection Fund (General and Miscellaneous Amendments) Regulations 2006 (S.I. 2006/580), regs. 1(1)(b), 21(2)

F8 Words in reg. 1(3) inserted (1.4.2009) by The Pension Protection Fund (Miscellaneous Amendments) Regulations 2009 (S.I. 2009/451), regs. 1, 2(2)(d)

F9 Reg. 1(4) substituted (19.8.2005) by The Occupational Pension Schemes (Miscellaneous Amendments) Regulations 2005 (S.I. 2005/2113), regs. 1(1), 5(3)

F10 Reg. 1(5) substituted (19.8.2005) by The Occupational Pension Schemes (Miscellaneous Amendments) Regulations 2005 (S.I. 2005/2113), regs. 1(1), 6(3)

F11 Words in reg. 1(5)(a) substituted (6.4.2010) by The Occupational Pension Schemes (Employer Debt and Miscellaneous Amendments) Regulations 2010 (S.I. 2010/725), regs. 1(2), 3(2)(a)

F12 Words in reg. 1(5)(a) substituted (27.1.2012) by The Occupational Pension Schemes (Employer Debt and Miscellaneous Amendments) Regulations 2011 (S.I. 2011/2973), regs. 1(2), 3(2)(a)

F13 Reg. 1(5)(a)(v) inserted (6.4.2010) by The Occupational Pension Schemes (Employer Debt and Miscellaneous Amendments) Regulations 2010 (S.I. 2010/725), regs. 1(2), 3(2)(b)

F14 Reg. 1(5)(a)(vi) inserted (27.1.2012) by The Occupational Pension Schemes (Employer Debt and Miscellaneous Amendments) Regulations 2011 (S.I. 2011/2973), regs. 1(2), 3(2)(b)

F15 Words in reg. 1(5)(b) substituted (6.4.2010) by The Occupational Pension Schemes (Employer Debt and Miscellaneous Amendments) Regulations 2010 (S.I. 2010/725), regs. 1(2), 3(2)(a)

F16 Words in reg. 1(5)(b) substituted (27.1.2012) by The Occupational Pension Schemes (Employer Debt and Miscellaneous Amendments) Regulations 2011 (S.I. 2011/2973), regs. 1(2), 3(2)(a)

F17 Reg. 1(5)(b)(v) inserted (6.4.2010) by The Occupational Pension Schemes (Employer Debt and Miscellaneous Amendments) Regulations 2010 (S.I. 2010/725), regs. 1(2), 3(2)(c)

F18 Reg. 1(5)(b)(vi) inserted (27.1.2012) by The Occupational Pension Schemes (Employer Debt and Miscellaneous Amendments) Regulations 2011 (S.I. 2011/2973), regs. 1(2), 3(2)(c)

F19 Reg. 1(6) inserted (9.2.2011) by The Electronic Money Regulations 2011 (S.I. 2011/99), reg. 1(2)(a)(xv), Sch. 4 para. 18 (with reg. 3)

Commencement Information

I1 Reg. 1 wholly in force at 6.4.2005; reg. 1 not in force at made date; reg. 1(1)-(3) in force at 1.4.2005 for certain purposes and reg. 1 in force at 6.4.2005 in so far as not already in force, see reg. 1(2)

Marginal Citations

M1 1986 c. 45.

M2 1988 c. 1.

M3 1993 c. 48.

M4 1995 c. 26.

M5 2000 c. 8.

M6 See section 7(2)(b) of the Pensions Act 2004 which provides that “the Authority” in section 124(1) of the Pensions Act 1995 means “the Pensions Regulator”.

M7 S.I. 1986/1925 as amended by S.I. 1987/1919, 1989/397, 1991/495, 1993/602, 1995/586, 1999/359, 1999/1022, 2001/763, 2002/1307, 2002/2712, 2003/1750, 2004/584 and 2004/1070.