March 26, 2020
Ontario’s pension regulator, the Financial Services Regulatory Authority (“FSRA”), has released a statement on how the COVID-19 situation has impacted its operations. The statement also includes responses to some questions which may be arising for pension plan administrators, members, retirees and other stakeholders across Ontario during these uncertain times.
FSRA begins its statement by noting that nearly all FSRA staff are currently working remotely. During this time, FSRA explains that it “will continue operations and will consider approaches that can assist plan administrators in their ongoing administration and compliance efforts while not losing sight of the need to provide benefits and protect the rights of plan beneficiaries”.
FSRA also notes that it is reviewing its “work, stakeholder engagement activities and other commitments to prioritize activities”. It has committed to regular communications with the industry during this period. Our firm will be monitoring this and will post summaries of any such communications when they become available. Information on how to access this information is set out below.
Response to Stakeholder Questions
FSRA’s statement includes responses to some questions which may be arising in the current circumstances. It also notes that this is a “unique and rapidly evolving situation” and that their positions may evolve over the coming days and weeks.
A summary of the questions and answers is set out below and the full version is set out at the link above.
- Will FSRA grant extensions for upcoming regulatory filings?
Section 105 of the Pension Benefits Act allows pension plan administrators to request a filing extension of up to 60 days beyond the timeline set out in the PBA. Plan administrators can submit extension requests of up to 60 days through FSRA’s Pension Services Portal. Requests for longer extensions should be sent by by email or regular mail to your Plan’s assigned Pension Officer.
- What will FSRA’s response be if Plan Administrators are unable to provide member disclosure information (e.g. annual and biennial pension benefit statements, termination statements and retirement statements) within the prescribed timelines set out in the PBA?
In response, FSRA notes that it does not have discretionary powers to extend the prescribed timelines as they relate to member disclosures, but effective immediately, provided you have advised your Pension Officer of the challenges you are experiencing and your proposed plan of action, summary administrative monetary penalties will not be levied with respect to non-compliance in this area until further notice from FSRA.
- If I am a retiree from a pension plan supervised by FSRA and I have stopped receiving my pension payments, what should I do?
In this situation, FSRA advises retirees to first contact your pension plan administrator right away to inform them of your situation. If the situation persists, retirees are invited to contact FSRA by sending an email through its website.
- Will applications for FSRA’s CEO’s consent to specific transactions continue to be processed?
FSRA’s response to this question is that all pending transactions filed with FSRA (e.g. pension asset transfers or wind-up applications) will continue to be reviewed by FSRA staff, although they expect some delay due to the current situation.
- If a Plan Administrator becomes aware that the transfer ratio of its plan has deteriorated by 10% or more, what should it do?
FSRA notes that “financial market conditions are changing very rapidly and may result in significant volatility in the funded status of pension plans”. FSRA has confirmed that if the administrator knows or ought to know that the transfer ratio has fallen by 10% or more (or if the most recently determined transfer ratio was above 1 and it has fallen to 0.9 or less), the administrator is not allowed to transfer any part of the commuted value of a pension, deferred pension or ancillary benefit to which a member or former member is entitled without obtaining FSRA’s prior approval. More information about obtaining this approval can be found on FSRA’s website at the link above.
Receiving Further Updates from Koskie Minsky
For as long as the COVID-19 situation lasts, we will also be regularly posting other information relevant to the pensions and benefits industry. You can subscribe here and updates will be sent directly to your email inbox.
Pension and Benefits