O. Reg. 489/07: GENERAL


Published: 2007-08-24

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ontario regulation 489/07

made under the

pension benefits act

Made: August 22, 2007
Filed: August 24, 2007
Published on e-Laws: August 27, 2007
Printed in The Ontario Gazette: September 8, 2007


Amending Reg. 909 of R.R.O. 1990

(General)

1. (1) Section 6 of Regulation 909 of the Revised Regulations of Ontario, 1990 is amended by adding the following subsections:

(4.1) For the purposes of clause (4) (a), the sufficiency of the required contributions is to be determined on the basis of a going concern valuation and a solvency valuation.

(4.2) For the purposes of clause (4) (a), the required contributions are sufficient if, for each year of the period covered by the report, they are not less than the sum of the following amounts, determined using a benefit allocation method:

1. The normal cost of the plan.

2. The special payments set out in a previous report that remain to be paid with respect to any going concern unfunded liability.

3. The special payments set out in a previous report that remain to be paid with respect to any solvency deficiency.

4. The special payments to be paid with respect to any going concern unfunded liability that is determined in the report.

5. The special payments to be paid with respect to any solvency deficiency that is determined in the report.

(2) The English version of clause 6 (5) (a) of the Regulation is amended by striking out “submit” at the beginning and substituting “the actuary shall submit”.

2. The Regulation is amended by adding the following sections:

Payments — Specified Ontario Multi-employer Pension Plans

6.0.1 (1) A multi-employer pension plan is a specified Ontario multi-employer pension plan,

(a) if the administrator files an election with the Superintendent in accordance with section 6.0.3 declaring the plan to be a specified Ontario multi-employer pension plan; and

(b) if all of the eligibility criteria described in section 6.0.2 are satisfied when the election is filed.

(2) A plan ceases to be a specified Ontario multi-employer pension plan on the earliest of the following dates:

1. The date on which the first report is filed under section 3 or 14 in respect of the plan for a valuation date after August 31, 2010.

2. The date, if any, on which the first report is filed under section 3 or 14 in respect of the plan for a valuation date after the administrator rescinds the election in accordance with section 6.0.3.

3. The date, if any, on which the plan is amended so that one or more of the eligibility criteria described in paragraph 4, 5, 6 or 7 of subsection 6.0.2 (1) are no longer satisfied.

6.0.2 (1) The following are the eligibility criteria for a multi-employer pension plan to become a specified Ontario multi-employer pension plan:

1. At the end of the previous year, no more than 95 per cent of the members of the plan were employed by one employer.

2. During the previous year at least 15 employers made contributions to the plan or at least 10 per cent of the members of the plan were employed by two or more employers.

3. All or substantially all of the employers who make contributions to the plan are persons who are not exempt from tax under Part I of the Income Tax Act

(Canada).

4. All employers make contributions to the plan pursuant to one or more collective agreements.

5. The employers’ contributions to the plan are limited to a fixed amount set out in one or more collective agreements.

6. Under the plan, the administrator is authorized to determine the benefits that are to be provided under the plan, whether or not a collective agreement imposes restrictions on the exercise of that authority.

7. Nothing in the documents that create and support the plan prevents the administrator from reducing the amount of or the commuted value of a pension benefit, a pension, a deferred pension or an ancillary benefit in the circumstances described in subsection 14 (2) of the Act.

(2) For the purposes of this section, a group of employers that are affiliates within the meaning of the Business Corporations Act is deemed to be one employer.

(3) In this section,

“previous year” means, in relation to a pension plan, the fiscal year of the plan before the year in which the election is filed declaring the plan to be specified Ontario multi-employer pension plan.

6.0.3 (1) The administrator of a multi-employer pension plan that satisfies the criteria described in section 6.0.2 may file an election with the Superintendent declaring the plan to be a specified Ontario multi-employer pension plan.

(2) The election may be filed at any time on or after September 1, 2007 and before September 1, 2010.

(3) The election must be made in writing and only one election may be made in respect of a plan.

(4) The administrator may rescind the election and must do so by filing written notice of the rescission with the Superintendent.

(5) A rescission cannot be withdrawn once it has been filed.

6.0.4 (1) This section applies to each report filed under section 3, 13 or 14 for a specified Ontario multi-employer pension plan,

(a) if the report is filed on or after the day on which the administrator files the election under section 6.0.3; and

(b) if the valuation date of the report falls before September 1, 2010.

(2) Subsections 6 (4.1) and (4.2) do not apply with respect to a report to which this section applies.

(3) For the purposes of clause 6 (4) (a), the required contributions to the plan are sufficient if, for each year of the period covered by the report, they are not less than the sum of the following amounts determined using a benefit allocation method:

1. The normal cost of the plan.

2. The special payments set out in a previous report that remain to be paid with respect to any going concern unfunded liability.

3. The special payments to be paid with respect to any going concern unfunded liability that is determined in the report.

(4) If a report filed under section 3, 13 or 14 in respect of the plan discloses that there is a going concern unfunded liability, the liability shall be liquidated, with interest at the going concern valuation interest rate, by equal monthly instalments over a period of 12 years beginning on the valuation date of the report.

(5) Subsection (6) applies if, after a plan amendment referred to in that subsection, the transfer ratio of the plan is less than 0.8 or the ratio of the market value of the plan assets to the going concern liabilities is less than 0.9.

(6) If the plan is amended to increase pension benefits or ancillary benefits and if either of the conditions described in subsection (5) exist, any increase in the going concern unfunded liability as a result of the amendment shall be liquidated, with interest at the going concern valuation interest rate, by equal monthly instalments over a period of eight years beginning on the valuation date of the report in which the increase in the going concern unfunded liability was determined.

(7) Within 60 days after filing a report to which this section applies, the administrator shall give written notice to each member and former member of the plan that an election has been made under section 6.0.3. 

(8) The written notice shall contain the following information:

1. The name and provincial registration number of the plan.

2. The name and contact information for the administrator.

3. The transfer ratio of the plan; and if the plan is amended to increase pension benefits or ancillary benefits, the transfer ratio both before and after the amendment, effective on the valuation date of the report.

4. An explanation of how the security of pension benefits and ancillary benefits for members and former members might be affected as a result of the election filed under section 6.0.3.

(9) Within 60 days after filing a report to which this section applies, the administrator shall file a copy of the notice required by subsection (7) with the Superintendent and shall give a copy to every employer who makes contributions to the plan and to every bargaining agent who represents members of the plan.

(10) The administrator shall also give a copy of the notice required by subsection (7) to each person who will be eligible or is required to become a member of the plan after the filing of a report to which this section applies and before the plan ceases to be a specified Ontario multi-employer pension plan, and the notice must be given to him or her together with the information described in subsection 25 (1) of the Act. 

3. Subsection 14 (7) of the Regulation is amended by adding the following clause:

(c.3) despite clause (c.2), in the case of a specified Ontario multi-employer pension plan, if there is a going concern unfunded liability in the report, the amount of the going concern unfunded liability and the special payments required to liquidate it in accordance with section 6.0.4;

4. Clause 14 (8) (b) of the Regulation is revoked and the following substituted:

(b) the special payments remaining to be paid after the valuation date with respect to the solvency deficiency determined in any of the previously filed reports;

(b.1) if there is a solvency deficiency in the report, the amount of the solvency deficiency and the special payments required to liquidate it in accordance with section 5;

5. This Regulation comes into force on September 1, 2007.

 

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