The European Fund and Asset Management Association has today released a report called “The OCERP: a Proposal for a European Person Pension Product” which it describes as a “blueprint for a European brand of personal pension products”.
OCERP stands for Officially Certified European Retirement Product.
Introducing the report, Peter De Proft, director general of EFAMA, said: “The proposed high standards of consumer protection, governance and distribution will associate the OCERP with a high-quality EU label.
“As a blueprint for a European brand of personal pension products, the creation of the OCERP would help overcome the current fragmentation of the European pensions market and, thus, improve the cost-effectiveness of these products and their portability between member states.
“By proposing that banks, insurers, pension funds and asset managers expand their product offering towards the OCERP, EFAMA proposes to follow an inclusive approach for the creation of personal pension products to serve the interests of all European citizens.”
EFAMA said the product would allow individuals to choose between several investment options and will “ensure providers maintain a robust governance framework and administrative systems”. It added that any product that meets these standards could be distributed throughout Europe with an EU passport.
The report (available here), which is being distributed to EU policy makers and institutions, contains a set of recommended standards that a European personal pension product should comply with in order to be certified as an OCERP, and sold throughout Europe. It also presents different legislative approach scenarios to provide an EU passport to the OCERP and to regulate the conditions under which financial institutions could provide OCERPs across Europe.
EFAMA added that the creation of an EU framework for personal pension products would also contribute to channelling retail investors’ savings towards the European Long-Term Investment Funds recently proposed by the European Commission.
As reported, EFAMA proposed the introduction of a pan-Europe long term savings product more than three years ago, suggesting at the time that the existing products are unsustainable in their current form.
“EFAMA believes that the OCERP concept could play a supportive and meaningful role in channelling retirement savings towards long-term investments,” added De Proft.
“We recognise that there are legal, prudential and tax hurdles for the emergence of a single market for personal pension products and this report does not set out to provide clear-cut solutions for each of these issues. Instead, we will look to use it as a working document in our continued dialogue with European legislators and decision makers.”
