PEPP. Could it channel an additional road towards viable pensions?
Τhe Directive on Institutions for Occupational Retirement Provision (IORPs ΙΙ) regulates a private, voluntary and collective pension scheme, which supplements the state pensions. In September 2015, the Commission presented the fundamental guidelines for a new private and individual pension product, which is the standard Pan-European Personal Pension Product (PEPP).
Four years later, on 14.8.2019, the PEPP Regulation 1238/2019 entered into force. The PEPP’s design is product-centered, insofar as it combines uniform integral elements (simplicity, transparency, cost-effectiveness, good governance). It also contains features that can be tailored to the target group of each PEPP and take into account parameters, such as retirement age, biometric risk coverage, et.al. In this sense, although the distribution of PEPPs is subject to prior authorization, undertakings with experience in long-term investment products, including insurance undertakings and financial institutions, are entitled to provide them. One of the main objectives of inserting the PEPP in the pension schemes market is that individuals themselves become “owners” of their supplementary pension assurance, and that the integration of the internal market and the gradual abolition of national borders is fostered.