Source: http://www.legislation.gov.uk/nisi/2005/255/part/II/crossheading/powers-in-relation-to-winding-up-of-occupational-pension-schemes
Timestamp: 2020-01-19 19:21:12
Document Index: 22502403

Matched Legal Cases: ['art. 19', 'art 1', 'art 5', 'art 1', 'art 6', 'art 4', 'Art. 20']

Changes over time for: Cross Heading: Powers in relation to winding up of occupational pension schemes
Powers in relation to winding up of occupational pension schemesN.I.
Powers to wind up occupational pension schemesN.I.
(a)to ensure that the scheme's protected liabilities do not exceed its assets, or
(b)references to the assets of the scheme are references to those assets excluding any assets representing the value of any rights in respect of money purchase benefits (within the meaning of that Order) under the scheme. ,”
“(6A) Paragraph (6) does not have effect to authorise the Authority to make an order as mentioned in sub-paragraph (a) or (b) of that paragraph, if their doing so would be unlawful as a result of section 6(1) of the Human Rights Act 1998 (unlawful for public authority to act in contravention of a Convention right).” .
Freezing ordersN.I.
19.—(1) This Article applies to an occupational pension scheme which is not a money purchase scheme.
(2) The Regulator may make a freezing order in relation to such a scheme if and only if—
(a)the order is made pending consideration being given to the making of an order in relation to the scheme under Article 11(1)(c) of the 1995 Order (power to wind up schemes where necessary to protect the generality of members), and
But no freezing order may be made in relation to a scheme during an assessment period (within the meaning of Article 116) in relation to the scheme (see Article 119(11)).
(3) A freezing order is an order directing that during the period for which it has effect—
(4) A freezing order may also contain one or more of the following directions which have effect during the period for which the order has effect—
(i)corresponds to any contribution which would be due to be paid towards the scheme on behalf of a member but for a direction under sub-paragraph (b), and
(i)no transfers or no specified transfers of, or no transfer payments or no specified transfer payments in respect of, any member's rights under the scheme rules are to be made from the scheme, or
(g)a direction that no statements of entitlement are to be provided to members of the scheme under section 89A of the Pension Schemes Act ([F1benefits other than money purchase]: right to statement of entitlement);
(6) A freezing order may not contain a direction under paragraph (4)(d) or (e) which reduces the benefits payable to or in respect of a member, for the period during which the order has effect, below the level to which the trustees or managers of the scheme would have power to reduce them if a winding up of the scheme had begun at the time when the freezing order took effect.
(7) A direction under paragraph (4)(f) may, in particular, provide that transfers or specified transfers of, or transfer payments or specified transfer payments in respect of, any member's rights under the scheme rules may not be made from the scheme unless the amounts paid out from the scheme in respect of the transfers or transfer payments are determined in a specified manner and the transfer or transfer payments satisfy such other conditions as may be specified.
(8) A freezing order may also require the trustees or managers of the scheme to obtain an actuarial valuation within a specified period.
(9) A freezing order containing such a requirement must specify—
(10) For the purposes of paragraph (8)—
“an actuarial valuation” means a written valuation of the scheme's assets and liabilities prepared and signed by the actuary,
(11) In this Article “specified” means specified in the freezing order.
F1Words in art. 19(4)(g) substituted (6.4.2015) by Pension Schemes Act 2015 (c. 8), s. 89(3)(b), Sch. 4 para. 82 (with s. 87)
Consequences of freezing orderN.I.
20.—(1) If a freezing order is made in relation to a scheme any action taken in contravention of the order is void except to the extent that the action is validated by an order under Article 22.
(2) A freezing order in relation to a scheme does not prevent any increase in a benefit which is an increase which would otherwise accrue in accordance with the scheme or any statutory provision during the period for which the order has effect, unless the order contains a direction to the contrary.
(3) A freezing order in relation to a scheme does not prevent the scheme being wound up in pursuance of an order under Article 11 of the 1995 Order (power to wind up occupational pension schemes).
(4) If a freezing order contains a direction under Article 19(4)(b) that no further contributions, or no further specified contributions, are to be paid towards a scheme during the period for which the order has effect—
(b)any obligation to pay those contributions (including any obligation under Article 49(8) of the 1995 Order to pay amounts deducted corresponding to such contributions) is to be treated as if it does not arise.
(5) If a freezing order contains a direction under Article 19(4)(f) (no transfers or discharge of member's rights) it does not prevent—
(ii)a direction under Article 19(4)(d) or (e) does not prevent the payment becoming due.
“pension sharing order or provision” means an order or provision falling within Article 25(1) of the 1999 Order (activation of pension sharing);
an order under Article 25 of the Matrimonial Causes (Northern Ireland) Order 1978 (NI 15) (financial provision orders in connection with divorce etc.) so far as it includes provision made by virtue of Article 27B or 27C of that Order (powers to include provision about pensions),
[F2 an order under Part 1 (financial provision in connection with dissolution, nullity or separation) of Schedule 15 to the Civil Partnership Act 2004 (financial relief in the High Court or a county court etc. : Northern Ireland) so far as it includes provision made by virtue of paragraphs 20 and 21 of Part 5 of that Schedule (powers to include provisions about pensions), ]
an order under section 23 of the Matrimonial Causes Act 1973 (c. 18) so far as it includes provision made by virtue of section 25B or 25C of that Act (powers in England and Wales corresponding to those mentioned in paragraph (a)),F2. . .
an order under section 12A(2) or (3) of the Family Law (Scotland) Act 1985 (c. 37) (powers in relation to pension lump sums when making a capital sum order)[F2, or].
[F2 an order under Part 1 (financial provision in connection with dissolution, nullity or separation) of Schedule 5 to the Civil Partnership Act 2004 (financial relief in the High Court or a county court etc. ) so far as it includes provision made by virtue of paragraphs 25 and 26 of Part 6 of that Schedule (powers to include provisions about pensions). ]
(7) Regulations may modify any provisions of—
[F3(a)Chapter 1 of Part 4ZA of the Pension Schemes Act (transfer rights: general), or
(b)Chapter 2 of that Part (early leavers: cash transfer sums and contribution refunds),]
in their application to an occupational pension scheme in relation to which a freezing order is made containing a direction under Article 19(4)(f), (g) or (h) (no transfers etc. in respect of, member's rights or refunds of contributions etc. from the scheme).
(8) Disregarding paragraph (1), if a freezing order made in relation to a scheme is not complied with, Article 10 of the 1995 Order (civil penalties) applies to any trustee or manager of the scheme who has failed to take all reasonable steps to secure compliance.
(9) Paragraph (8) does not apply in the case of non-compliance with a direction under Article 19(4)(c) (direction that certain deducted contributions are to be repaid by the employer).
(10) In such a case, Article 10 of the 1995 Order (civil penalties) applies to an employer who, without reasonable excuse, fails to repay an amount as required by the direction.
F3Art. 20(7)(a)(b) substituted (6.4.2015) by Pension Schemes Act 2015 (c. 8), s. 89(3)(b), Sch. 4 para. 83 (with s. 87)
Period of effect etc. of freezing orderN.I.
21.—(1) A freezing order must specify the period for which it has effect.
(2) The period specified must not exceed three months.
(3) The Regulator may on one or more occasions by order extend the period for which the order has effect.
(4) But the total period for which the order has effect must not exceed six months.
(5) This Article is subject to Articles 23, 24 and 25 (effect of winding up and assessment period on freezing orders).
Validation of action in contravention of freezing orderN.I.
22.—(1) If a freezing order is made in relation to a scheme, the Regulator may by order validate action taken in contravention of the order.
(2) Any of the following persons may apply to the Regulator for an order under this Article validating particular action—
Effect of determination to wind up scheme on freezing orderN.I.
23.—(1) This Article applies where—
(a)the Regulator determines to make an order under Article 11 of the 1995 Order (power to wind up occupational schemes) in relation to a scheme ( “a winding up order”),
(c)the case is not one to which the special procedure in Article 93 applies (immediate exercise of powers where immediate risk to assets etc.), and
(d)the winding up order accordingly cannot be made until the expiry of the period specified in Article 91(5) (no exercise of powers during period of referral to the Tribunal etc.).
(a)where the winding up order is made, it ceases to have effect under Article 24 from the time when that order is made, or
(3) Paragraph (2) is subject to the Regulator's power under Article 96 to revoke the freezing order at any time.
Effect of winding up order on freezing orderN.I.
24.—(1) This Article applies where—
(a)an order is made under Article 11 of the 1995 Order (power to wind up occupational pension schemes) in relation to a scheme, and
(a)the winding up of the scheme in pursuance of the order under Article 11 of the 1995 Order is to be taken as beginning at the time when the freezing order took effect, and
(b)the freezing order ceases to have effect from the time when the order under Article 11 of the 1995 Order is made.
(3) The Regulator may by order direct any specified person—
(a)to take such specified steps as it considers are necessary as a result of the winding up of the scheme being deemed under paragraph (2)(a) to have begun at the time when the freezing order took effect, and
(4) If the trustees or managers of a scheme fail to comply with a direction to them contained in an order under this Article, Article 10 of the 1995 Order (civil penalties) applies to any trustee or manager who has failed to take all reasonable steps to secure compliance.
(5) That Article also applies to any other person who, without reasonable excuse, fails to comply with a direction to him contained in an order under this Article.
(6) In this Article “specified” means specified in an order under this Article.
Effect of assessment period under Part III on freezing orderN.I.
Power to give a direction where freezing order ceases to have effectN.I.
Notification of trustees, managers, employers and membersN.I.
(b)an order is made under Article 22 validating action taken in contravention of a freezing order made in relation to a scheme,
(c)an order is made under Article 24 directing specified steps to be taken following the winding up of a scheme, or
(d)an order is made under Article 26 in relation to a scheme where a freezing order ceases to have effect.
(2) The Regulator must, as soon as reasonably practicable after the order has been made, notify—
(3) The Regulator may by order direct the trustees or managers of the scheme to notify—
of the fact that the order mentioned in paragraph (1) has been made and of its effect.
(4) Notification is to be within the period and in the manner specified in the order under paragraph (3).
(5) If the trustees or managers of a scheme fail to comply with a direction to them contained in an order made under paragraph (3), Article 10 of the 1995 Order (civil penalties) applies to any trustee or manager who has failed to take all reasonable steps to secure compliance.
Articles 19 to 27: supplementaryN.I.