Solvency Exemption for Specified Non-Profit Sector Pension Plans Regulation

Solvency Exemption for Specified Non-Profit Sector Pension Plans Regulation, M.R. 175/2015 The Pension Benefits Act , C.C.S.M. c. P32 Regulation 175/2015 Registered October 30, 2015 bilingual version (HTML) Table of Contents Section 1 Overview 2 Definitions and interpretation 3 Conflict 4 Election notice 5 Election 6 Filing requirements 7 Notice to participating employers 8 Effect of election 9 Solvency tests to continue to be applied 10 Restriction on plan Overview 1 This regulation (a) enables the administrator of a plan to opt out of certain solvency provisions and transfer deficiency provisions of the Pension Benefits Regulation in relation to the plan; (b) establishes conditions for opting out of those provisions; and (c) sets out the legal consequences of opting out of those provisions. Definitions and interpretation 2(1) The following definitions apply in this regulation. "administrator" means the person or body of persons responsible for the administration of a plan. (« administrateur ») "election notice" means the notice given under section 4. (« avis de choix ») "participating employer" means an employer that has agreed to participate in a plan. (« employeur participant ») " Pension Benefits Regulation " means the Pension Benefits Regulation , M.R. 39/2010. («  Règlement sur les prestations de pension  ») "plan" means (a) The Retirement Plan for Employees of Manitoba Possible; (a.1) The Pension Plan for the Employees of the Manitoba Museum; or (b) Community Agencies Retirement Plan. (« régime ») "solvency provisions" means the following provisions of the Pension Benefits Regulation : (a) clause 4.6(c); (b) clause 4.18(1)⁠(b); (c) clause (c) of the "Solvency" provisions in the table (under section 2 of Schedule A) that prescribes the additional information required in each annual statement. (« dispositions régissant la solvabilité ») "transfer deficiency provisions" means the following provisions of the Pension Benefits Regulation : (a) section 4.30; (b) the "Transfer deficiency" provisions in the tables (under section 2 of Schedule A) that prescribe the additional information required in the following statements: (i) a termination statement, (ii) a retirement statement, (iii) a pre-retirement death statement. (« dispositions régissant les déficits de transfert ») 2(2) Subject to subsection (1) and unless the context otherwise requires, terms used in this regulation have the same meaning as they have in the Pension Benefits Regulation . M.R. 31/2016 ; 144/2021 Conflict 3 In the event of a conflict between a provision of this regulation and a provision of the Pension Benefits Regulation , the provision of this regulation prevails. Election notice 4(1) The administrator of a plan that seeks to have the plan exempted from the solvency provisions and the transfer deficiency provisions may initiate the election process by sending out the notice under subsection (2). 4(2) Before making the election, the administrator must send a written notice to all plan members or their agents, to each bargaining agent representing plan members, to any other beneficiary entitled to benefits under the plan and to each participating employer. The notice must contain (a) a statement of the administrator's intention to make the election and the reasons for making it; (b) an explanation of the effect of the election; (c) any amendments to the plan relating to the election; (d) a statement that there is a possibility of future reductions to the pension and other benefits that a member has a present entitlement to receive under the plan and the reasons the reductions may be required; (e) a statement that any comments or questions in relation to the election may be directed to the administrator within 30 days after receipt of the notice; (f) a statement that the election will be made only if (i) fewer than 1/3 of the members not yet receiving a pension, and (ii) fewer than 1/3 of the total number of members receiving a pension and other beneficiaries, object to the election by sending a written notice of objection to the administrator at the address and by the date specified in the notice, which must be at least 30 days after the date the administrator sends the notice; and (g) a statement that the election is irrevocable. Election 5(1) The administrator of a plan must elect to opt out of the solvency provisions and transfer deficiency provisions in relation to the plan if (a) fewer than 1/3 of the members not yet receiving a pension; and (b) fewer than 1/3 of the total number of members receiving a pension and other beneficiaries; objected to the proposed election within the time allowed for objections. 5(2) The election is irrevocable. Filing requirements 6 If the administrator makes an election under section 5, the following documents and information must be filed with the superintendent within 60 days after the election notice was sent out: (a) written confirmation of the election to opt out of the solvency provisions and transfer provisions; (b) a copy of the election notice; (c) a statement confirming that the election notice was sent as required by section 4 and the date that it was sent; (d) a statement confirming that (i) no participating employer, (ii) fewer than 1/3 of the members not yet receiving a pension, and (iii) fewer than 1/3 of the total number of members receiving a pension and other beneficiaries, objected to the proposed election within the time allowed for objections. Notice to participating employers 7 If the administrator makes an election under section 5, the administrator must provide written notice of the election to each participating employer. Effect of election 8(1) Despite the provisions of a plan but subject to subsection (2), if an election has been made under section 5 and the administrator has filed the applicable documents with the superintendent as required by section 6, the following rules apply: (a) the solvency provisions and the transfer deficiency provisions no longer apply to the plan; (b) if an actuarial valuation report or cost certificate prepared for the plan as of a review date reveals that it has no unfunded liability on a going concern basis that includes a margin for adverse deviations equal to at least 15% of the going concern liabilities and no solvency deficiency, a surplus in the plan may be used, applied or paid as permitted by subsection 4.27(1) of the Pension Benefits Regulation ; (c) when applying subclause (c)⁠(ii) of the definition "solvency assets" in subsection 4.7(1) of the Pension Benefits Regulation to the plan, the reference to "special payments" is to be read as a reference to special payments under clause 4.18(1)⁠(d) of that regulation; (d) the annual statement required by section 3.33 of the Pension Benefits Regulation must include a statement that on a termination or winding up of the plan, in whole or in part, the employer must fund, in accordance with the Act and this regulation, any solvency deficiency that exists at that time. 8(2) Subsection (1) ceases to apply when the plan is terminated or wound up in whole. 8(3) Subsection (1) ceases to apply to the portion of a plan that is the subject of a partial termination under subsection 7.4(1) of the Pension Benefits Regulation . 8(4) Subsection (1) ceases to apply to the portion of the plan that is affected by the withdrawal of a participating employer who joins or establishes another pension plan as a successor to the plan. M.R. 144/2021 Solvency tests to continue to be applied 9 Despite section 8, the administrator of a plan must ensure that solvency tests are performed as required by Division 2 of Part 4 of the Pension Benefits Regulation , and that the results of those tests are reported as required by sections 4.9 to 4.17 of the Pension Benefits Regulation . Restrictions on plan 10 If an election has been made under section 5 (a) a surplus in a plan may only be used for benefit restorations or improvement, or contribution reductions, if the plan is fully funded on a going concern basis that includes a margin for adverse deviations equivalent to at least 15% of the going concern liabilities and no solvency deficiency; and (b) any benefits restorations or improvements, or contribution reductions, must not put the going concern valuation as defined in subsection 4.7(1) of the Pension Benefits Regulation , including a margin for adverse deviations equivalent to at least 15% of the going concern liabilities, in a deficit.