Brussels, 26 February 2019 - For immediate release

EFAMA welcomes the European Parliaments approval of the trilogue agreement on the PEPP

EFAMA welcomes todays approval by the European Parliament's Economic and Monetary Affairs (ECON) Committee of the trilogue agreement on the proposed pan-European Personal Pension Product (PEPP), which paves the way to the development of personal pension products with a European label.

EFAMA reiterates its strong support for the PEPP which has a strategically important role to help and encourage European citizens to save for retirement and to channel more savings towards long-term investments in the EU. The PEPP has the potential to become a significant part of the single market and to strengthen the Capital Markets Union by increasing the share of household saving being invested in capital market instruments*. It is good news for European savers that they will have the possibility to choose Basic PEPPs based on life-cycle strategies which are consistent with the ultimate goal of protecting the long-term real value of the contributed capital.

Looking forward, the PEPP Regulation will only produce all of its expected positive effects if the accompanying Level-2 measures ensures that the PEPP is attractive to both savers and providers. The tax treatment applicable to the PEPP will also be a crucial element for its promotion across Member States. In this respect, EFAMA supports the European Commissions recommendation that Member States grant the same tax relief to the PEPP as the one granted to national pension products to ensure that the PEPP gets off to a flying start.

EFAMA has been supportive of the European Commissions proposal for a PEPP from day one. This is why we commend the Rapporteur in the European Parliament, Sophie int Veld, her colleagues Shadow Rapporteurs, as well as the Estonian, Bulgarian, Austrian and Romanian Presidencies and their colleagues from Member States for their efforts throughout the negotiating process.

We now hope that the European Parliaments Plenary Session will give its full backing to the text.

William Nott, EFAMA President, commented: The PEPP has the potential both to provide European savers with a high quality pension product and to facilitate wider investment and job mobility in the European economy. All progress that could be made to move towards transparent and simple taxation rules would help reducing the cost of providing the PEPP on a cross-border basis and reinforce the success of the PEPP.

Nicolas Calcoen, EFAMA Vice-President, added: The PEPP is an important milestone towards modernizing the personal pension system in Europe by allowing a broad range of providers to offer the PEPP, including asset managers and pension funds. Provided that the complete regulatory framework will remain sufficiently flexible, this will promote competition, widen consumers choice and encourage individuals to save more for retirement.

Tanguy van de Werve, EFAMA Director General, noted: We welcome the results of the ECON vote. Going forward, EFAMA will continue engaging with the European Commission and EIOPA to share ideas and provide feedback on the Level-2 measures on the PEPP key information document (PEPP KID), the risk-mitigation techniques used by the various types of PEPP, and the fee cap for the Basic PEPP.

[* The report recently published by EFAMA entitled Ownership of Investment Funds in Europe" confirms that circa 36% of European households' financial assets were held in bank accounts at end 2017.]

Notes for editors:

EFAMA
EFAMA is the representative association for the European investment management industry, it represents through its 28 member associations and 62 corporate members more than EUR 16 trillion of investment fund assets at end Q3 2018. These assets were managed by almost 61,600 investment funds, of which close to 33,000 were UCITS (Undertakings for Collective Investments in Transferable Securities) funds, with the remaining funds composed of AIFs (Alternative Investment Funds). Including discretionary mandates, third-party regulated asset managers managed EUR 25 trillion in Europe at end 2017. For more information about EFAMA, please visit www.efama.org.

For media enquiries, please contact:
Tanguy van de Werve, EFAMA Director General
Telephone: +32 (0) 2 513 39 69
info@efama.org

- Ends