Update on temporary portability freeze

On March 27, 2020, OSFI announced regulatory adjustments to protect the interests of pension plan members and beneficiaries, and to allow administrators of federally regulated private pension plans to focus their efforts on addressing the many challenges posed by COVID-19. One of the measures taken was a temporary portability freeze that prohibited portability transfers and annuity purchases relating to defined benefit plan provisions. This freeze was effected through a change to the Directives of the Superintendent pursuant to the Pension Benefit Standards Act, 1985 (Directives).

On August 31, 2020, OSFI announced that, subject to certain conditions, the Superintendent had lifted this temporary portability freeze. The Directives were adjusted to include conditions on portability transfers and buy-out annuity purchases similar to those in place prior to the portability freeze. Please refer to the article in this newsletter titled Amendments to the Directives of the Superintendent and our FAQs for more information about the conditions now applicable to portability transfers and annuity purchases.

OSFI continues to monitor the impacts of COVID-19 on pension plans and is prepared to reintroduce a portability freeze or adjust the Directives further, if necessary.