Pension advisory committees
Effective Jan.1, 2017, the Pension Benefits Act was amended to make it easier for plan members to establish pension advisory committees for Ontario-registered pension plans. The new rules provide that the purposes of a PAC are (i) to monitor the administration of the pension plan, (ii) to make recommendations to the administrator respecting the administration of the pension plan, and (iii) to promote awareness and understanding of the pension plan. Specific procedures relating to the establishment of a PAC, including the requirement to hold a vote to determine if a PAC should be created if certain conditions are met, are set out in the PBA. The PBA provides that reasonable costs related to the establishment and operation of a PAC are payable out of the pension fund.
PRPP legislation now in force
On Dec. 8, 2016, the Pooled Registered Pension Plans Act, 2015 and supporting regulations came into force. The Act establishes a framework for businesses to offer pooled registered pension plans to employees and to make PRPPs available to the self-employed. The regulations contain details required to implement PRPPs in Ontario.
On Feb. 17, 2017, the Ontario government filed O. Reg 48/17, adopting the Multilateral Agreement Respecting Pooled Registered Pension Plans and Voluntary Retirement Saving Plans (as amended by the “2017 Agreement Amending the Multilateral Agreement Respecting Pooled Registered Pension Plans and Voluntary Retirement Saving Plans”) effective March 31, 2017. The governments of Canada, British Columbia, Nova Scotia, Quebec and Saskatchewan adopted the Agreement in June 2016.
Read the PRPP Act and related regulations.
ORPP legislation repealed
On Dec. 8, 2016, the Ontario Retirement Pension Plan Legislation Repeal Act, 2016 came into force. The Act repealed the Ontario Retirement Pension Plan Act, 2015, the Ontario Retirement Pension Plan Administration Corporation Act, 2015 and the Ontario Retirement Pension Plan Act (Strengthening Retirement Security for Ontarians), 2016. It also dissolves the Ontario Retirement Pension Plan Administration Corporation, among other things. Read on for more information (Schedule 18).
Financial Services Regulatory Authority
The Ontario government is establishing a new financial services regulator called the Financial Services Regulatory Authority of Ontario. The creation of FSRA, which is set out in the Financial Services Regulatory Authority of Ontario Act, 2016 (introduced as part of Bill 70), comes as a result of the mandate reviews of the Financial Services Commission of Ontario, the Financial Services Tribunal, and the Deposit Insurance Corporation of Ontario. The final report prepared by the expert panel commissioned to review the mandates of these entities was released in March 2016.
FSRA would be responsible for regulating certain areas of the financial services industry that currently fall under the responsibility of FSCO, the FST and DICO. The Act sets out an initial framework for the establishment of FSRA and comes into force on a day to be proclaimed. Regulations, and possibly additional legislation, are expected to be released setting out additional details. Read on for more information (Schedule 8).
Portability options for retired members
In Bill 70: Building Ontario Up for Everyone Act (Budget Measures), 2016 (Bill 70), the Ontario government proposed amendments to section 42 of the PBA to clarify that a retired member has access to portability options if that member has not yet elected to receive a pension, subject to plan terms. On February 17, 2017, O-Reg. 49/17, which updates references to the portability provisions in Regulation 909 under the PBA to permit retired members to access portability options, was filed. The amendments to section 42 of the PBA and the related regulations came into force March 1, 2017. Schedule 19 has more information and this website has more information on Regulation 49/17.
Administrative monetary penalties for non-compliance
Bill 70, which received royal assent on Dec. 8, 2016, amends the PBA to allow the Superintendent of Financial Services to levy administrative monetary penalties in certain circumstances, as described below. These amendments come into force on a day to be proclaimed.
The amendments provide that if the Superintendent is satisfied that a person is contravening or not complying with, or has contravened or failed to comply with, the PBA or regulations under the PBA, it has the authority to impose, by order, administrative monetary penalties on that person. Notice of the intended decision to impose a penalty must be provided to the person, and the person will be given an opportunity to request a hearing before any penalty is imposed. All orders imposing a penalty must be made within five years of the date the contravention or failure to comply occurred or is alleged to have occurred. The maximum penalty proposed is $10,000 for individuals and $25,000 for a corporation or other legal entity.
See Schedule 19 for more information.
Heather Di Dio is a partner with Dentons Canada LLP