COMMISSION RECOMMENDATION of 29.6.2017 on the tax treatment of personal pension products, including the pan-European Personal Pension Product
1. The attached documents relate to the draft legislative proposal for a Regulation on a pan-European Personal Pension Product (PEPP) and supporting recommendation on tax treatment of personal pension products, including PEPPs.
2. The general objective of the PEPP is to create a new portable pension product that can be sold across borders. A successful PEPP is designed to develop the single market for financial services, contributing to the completion of the Capital Markets Union (CMU), and also foster consumer savings for retirement, particularly in the more underdeveloped national pension markets.
3. There are 3 specific objectives of the PEPP to help achieve this:
• Increase investment in the EU and contribute to completing the CMU, where larger pools of pension savings can provide additional finance to long-term investments;
• Enhance features of personal pension products, allowing for simple, transparent personal pensions to be provided across the EU; and
• Enhance cross-border provision and portability of personal pensions, that will enable providers to achieve greater economies of scale, improve efficiency and innovation, and give individuals the opportunity to take their personal pension with them if moving to another Member State.
4. The proposal is not intended to replace or harmonise existing national personal pension schemes, but complement them by adding a pan-EU framework for pensions for those who wish to use it as a saving option. The approach is to enable providers to create a personal pension product that meets the requirements set out in the Regulation that will ultimately create a quality label for PEPPs that is hoped will increase consumer trust.