Registering a Plan as a Pooled Registered Pension Plan

Introduction

The Office of the Superintendent of Financial Institutions (OSFI) has issued this Instruction Guide to assist administrators of pooled registered pension plans (PRPPs) in completing the Application to register a plan as a pooled registered pension plan (Application Form). This form is a joint form issued by OSFI and the Canada Revenue Agency.

An administrator is required to complete and sign the Application Form when applying to register a PRPP. Applicants are to send a copy of the completed Application Form and a copy of the required documents to the Canada Revenue Agency Registered Plans Directorate Ottawa and to OSFI. Filing the Application Form and the additional information listed in this Instruction Guide will satisfy the administrator's filing requirements under subsection 12(2) of the Pooled Registered Pension Plans Act (PRPP Act).

The PRPP Act and the Pooled Registered Pension Plan Regulations (PRPP Regulations) are the authoritative source regarding the requirements for registering a plan as a PRPP under the PRPP Act.

A copy of the PRPP legislation and other PRPP related information can be found on OSFI's website.

1.0 Federal and Provincial PRPP Multilateral Agreement

Federal and provincial PRPP legislation, as well as legislation covering voluntary retirement savings plans in Quebec, authorize governments to enter into an agreement to streamline the regulation and supervision of PRPPs across the country. In June 2016, the governments of Canada, British Columbia, Saskatchewan, Québec and Nova Scotia entered into a Multilateral Agreement Respecting Pooled Registered Pension Plans and Voluntary Retirement Saving Plans (Multilateral Agreement). Other provincial governments may sign the Multilateral Agreement in the future once they have PRPP legislation in place.

The Multilateral Agreement provides that, except in Quebec, a federally-licensed administrator that registers a PRPP under the federal PRPP Act is exempt from the requirement to register that PRPP under the applicable provincial PRPP legislation.

The Multilateral Agreement also provides that a corporation that is authorized by Quebec’s Autorité des Marchés Financiers (AMF) to act as an administrator of a voluntary retirement savings plan (VRSP) is exempt from the requirement to obtain a licence under the federal PRPP Act. An administrator that holds a federal PRPP licence or an authorization to act as a VRSP administrator is also exempt from the requirement to obtain a licence under the applicable provincial PRPP legislation.

2.0 OSFI Supervision of PRPPs

By permitting federally-registered PRPPs to accept members whose employment falls under provincial jurisdiction, the Multilateral Agreement effectively authorizes OSFI to supervise a PRPP and its administrator on behalf of provinces that have members in the PRPP and that are party to the Agreement.

The Multilateral Agreement also establishes the rules that apply to PRPPs that include members from different jurisdictions. Generally, the provisions of the federal PRPP Act apply to all federally-registered PRPPs (including in respect of all members, survivors and other beneficiaries, its administrator, the Superintendent, and the employer offering the PRPP) instead of the corresponding provisions of provincial PRPP legislation that would otherwise apply if the Multilateral Agreement did not exist.

However, in respect of a provincial member of a federally-registered PRPP, the applicable provincial PRPP legislation applies to the matters set-out in Schedule C of the Multilateral Agreement. Similarly, provincial PRPP legislation applies to the provincial member’s spouse, common law partner, survivor or other beneficiary (or the equivalent in the respective jurisdiction) in respect of matters set out in Schedule C. The matters set out in Schedule C include, but are not limited to the following:

• The definition of spouse, former spouse, common-law partner and survivor (or the equivalent in the respective jurisdiction)
• The locking in, withdrawal, and surrender of funds from a member’s PRPP account
• Rules respecting variable payments, including the election of a member to receive variable payments from his or her PRPP account, and the annual variable payment amount permitted to be paid
• The transfer of funds from a member’s PRPP account to a pension plan, retirement savings plan, locked-in account or life annuity or other similar product, as well as the transfer of funds from these products

3.0 Note for Administrators of Voluntary Retirement Savings Plans

As noted in Part 1 of this Instruction Guide, a corporation that holds an authorization granted by the AMF to act as an administrator of a VRSP is exempt from the requirement to obtain a licence under the federal PRPP Act.

However, before offering a PRPP and entering into a contract with any person with respect to the plan, a VRSP administrator must register the PRPP under the federal PRPP Act. The administrator of a PRPP must ensure that the plan complies with the provisions of the federal PRPP Act and with any relevant provincial legislation with respect to matters set out in Schedule C of the Multilateral Agreement.

4.0 Filing an Application for Registration with OSFI

An administrator must file a completed and signed copy of the Application Form along with certified copies of the following documents:

• The plan text and any other document that includes the terms of the plan such as a member booklet
• A sample contract between the administrator and a participating employer
• Any other document that creates or supports the plan such as trust deeds or insurance contracts

OSFI expects the plan text or other supporting plan documents to clearly indicate the following:

• Whether, pursuant to subsection 41(3) of the PRPP Act, the employer or the administrator is responsible for providing notice of plan membership to each eligible employee
• The specific measures the administrator will take when a participating employer does not remit contributions in accordance with their contract
• The locking-in requirements of the PRPP
• That the PRPP’s costs meet the “low cost” criteria set out in section 20 of the PRPP Regulations. (Section 20 provides that costs are to be at or below those incurred by members of defined contribution plans that provide investment options to groups of 500 or more members, and costs are to be the same for all members of a PRPP.)
• A description of any fees, levies and other charges that would be triggered by the actions of the members^{Footnote 1}

OSFI’s review of the Application Form will not begin until it has received all required documentation. An incomplete application may be treated by OSFI as a withdrawn application if, within 60 days of the applicant receiving written notification by OSFI of the missing documentation, the application remains incomplete. If this occurs, OSFI will also notify the Canada Revenue Agency that it considers the application to be withdrawn.

5.0 OSFI Registration Process

The PRPP Act provides that the Superintendent must register a PRPP if all of the documents required under subsection 12(2) of the PRPP Act have been filed by the administrator but may nevertheless refuse to register the plan if it does not comply with the PRPP Act and PRPP Regulations. These documents are

• A copy of the plan
• A copy of every document that creates or supports the plan
• A declaration, signed by the administrator, that the plan complies with the provisions of the PRPP Act and the PRPP Regulations. A declaration of compliance is contained in the Application Form.

OSFI is not required to review a PRPP for compliance at the time of registration. However, if OSFI reviews the PRPP and finds areas of non-compliance, the Superintendent will notify the administrator of the particulars of the non-compliance. If the Superintendent refuses to register a PRPP, he or she must notify the administrator of the particulars of the non-compliance, and the administrator may, within 60 days, serve on the Superintendent a Notice of Objection and the Superintendent shall then reconsider the refusal. If the Superintendent still refuses to register the PRPP, the administrator may appeal the refusal to the Federal Court.

After the Application Form has been filed and while the application is under review by OSFI, we would ask that any changes to the information provided on the Application Form be submitted to OSFI in writing. For amendments to the plan text, please complete the Pooled Registered Pension Plan Amendment Information Form which may be found on OSFI’s website.

6.0 Instructions for Completing the Application Form

Section 1 - Plan identification

This is the name of the plan as defined in the plan documents. This legal plan name must be used in all supporting plan documents such as the trust agreement or insurance contract and the Declaration of Compliance at the end of the Application Form.

Section 2 – Plan administration

The date the corporation received a licence to be an administrator of a PRPP or the date that authorization was granted by the AMF to act as administrator of a VRSP is to be entered here.

In addition to providing the administrator’s contact email address, OSFI encourages all administrators to subscribe to the email notification service available through OSFI’s website. This will ensure that they receive notice of the availability of newsletters and periodic information updates.

Section 3 – Funding information

The name of the fund custodian(s), the policy or account number(s), and a contact person are to be entered on these lines. Please provide the address details for the contact person given.

Section 4 – Information concerning intended plan provisions

If members are permitted to make investment choices, include the name of each investment option as the “description of the type of fund”, the name of the proposed fund manager and the proposed cost of the investment option expressed as a percentage.

The PRPP Act requires administrators to provide PRPPs at a “low cost” to members, and the PRPP Regulations establish criteria for determining whether a PRPP is low cost. The criteria in the PRPP Regulations provide that costs to PRPP members must be at or below the costs incurred by the members of defined contribution pension plans that provide investment options to groups of 500 or more members. The PRPP Regulations define “costs” to mean all fees, levies and other charges that reduce a member’s return on investment other than those that are triggered by the actions of the member.

Section 5 – Declaration of Compliance

The Declaration of Compliance must be signed by an authorized officer of the administrator. The legal name of the PRPP as entered in Section 1 of the Application Form must be again entered here where the Application Form states “name of pooled registered pension plan”.

7.0 OSFI’s Ongoing PRPP Filing Requirements

This chart is provided for information purposes only and the documents referred to here do not have to be filed with the Application Form. Please refer to OSFI’s website for additional details on filing requirements.

8.0 Other Information

Before Offering a PRPP

The administrator of a PRPP must, before entering into a contract with any person with respect to the plan, provide proof to the person that it has a valid PRPP licence or VRSP authorization and that the plan is registered under the PRPP Act. This would include providing a copy of the certificate of registration or providing a link to the OSFI website that lists licensed PRPP administrators.

Posting of Cost Information to the Financial Consumer Agency of Canada’s Website

Once an administrator has entered into its first contract to provide a PRPP, OSFI will provide the Financial Consumer Agency of Canada (FCAC) with information concerning that PRPP’s costs. The FCAC will post on their website “costs” before applicable taxes, along with references to the applicable taxes. OSFI will be providing cost information to the FCAC based on the filings received including any amendments to costs after the plan has been registered.

Notifying OSFI of Late Remittances

Please note that administrators are required by section 18 of the PRPP Act to notify the Superintendent if an employer fails to comply with the provisions of the contract between the employer and the administrator respecting the amounts and frequency of remittances to the administrator.

9.0 Contact Information

For further information, visit our website or contact us at:

Office of the Superintendent of Financial Institutions
255 Albert Street
Ottawa, Ontario K1A 0H2
Facsimile: 613-990-7394
Email: information@osfi-bsif.gc.ca