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ontario regulation 105/19

made under the

Pension Benefits Act

Made: May 16, 2019
Filed: May 21, 2019
Published on e-Laws: May 21, 2019
Printed in The �������� Gazette: June 8, 2019

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

(GENERAL)

1. (1) Subsection 1 (2) of Regulation 909 of the Revised Regulations of ��������, 1990 is amended by adding the following definition:

“lump sum benefit improvement contribution” means a lump sum contribution that was made before the date a report is filed under subsection 3 (1) to fund, in whole or in part, any increase in going concern liabilities or solvency liabilities, or both, due to an amendment; (“cotisation forfaitaire pour amélioration des prestations”)

(2) The definition of “prior year credit balance” in subsection 1 (2) of the Regulation is amended by striking out “subsections 5 (13) to (16) or subsection 5.1 (5)” and substituting “subsections 5 (13) and (16)”.

2. Section 1.2 of the Regulation is amended by adding the following subsection:

(1.1) For the purposes of determining the present value of special payments in subclause (1) (d.1) (i), the references to the “last filed report” in clauses 5 (1.0.0.1) (a) and (b) shall be read as references to the report mentioned in subsection (1).

3. Clause 3 (1) (b) of the Regulation is revoked and the following substituted:

(b) a description of the lump sum benefit improvement contribution, if any; and

4. (1) Subsection 3.0.1 (2) of the Regulation is amended,

(a) by adding “lump sum benefit improvement” immediately before “contribution” in the portion before clause (a); and

(b) by striking out “at least” wherever it appears in clauses (a) and (b).

(2) Subsection 3.0.1 (3) of the Regulation is revoked.

(3) Subsection 3.0.1 (5) of the Regulation is revoked and the following substituted:

(5) Section 14.0.1 of the Act does not apply to a jointly sponsored pension plan listed in subsection 1.3.1 (3).

5. (1) Subsection 4 (0.1) of the Regulation is amended by adding the following definition:

“specified period” means, in respect of a report filed under section 3 or 14 or submitted under section 4 or 13, the period beginning on the later of the start of the fiscal year of the plan in which the report was filed or submitted and the valuation date of the report and ending on the day before the day on which the report is filed or submitted. (“période déterminée”)

(2) Section 4 of the Regulation is amended by adding the following subsections:

(3.2) If employer contributions to a pension plan during the specified period in respect of the most recently filed or submitted report are in excess of the contributions the report requires in respect of the specified period, the employer may apply the amount of the excess contributions to reduce any payment otherwise required in respect of the pension plan under the report for the period beginning on the day the report is filed or submitted and ending on the earlier of the last day of the fiscal year in which the report is filed or submitted and the filing date of the subsequent report.

(3.3) Subsection (3.2) does not apply if the most recently filed or submitted report is filed or submitted more than 12 months after the valuation date of the report, even if an extension for the filing or submission of the report is granted by the Superintendent under section 105 of the Act.

(3.4) Subsection (3.2) does not apply to a jointly sponsored pension plan.

6. (1) Clause 5 (1.0.0.1) (e) of the Regulation is amended by striking out “the value of any contribution in respect of the increase before the effective date of the amendment, with interest” and substituting “the lump sum benefit improvement contribution in respect of the increase, with interest”.

(2) Subsection 5 (16) of the Regulation is amended by striking out “Subject to subsections (13) and (16.1)” at the beginning and substituting “Subject to subsections (13), (16.1) and (16.3)”.

(3) Subsection 5 (16) of the Regulation is amended by striking out “Subject to subsections (13), (16.1) and (16.3)” at the beginning and substituting “Subject to subsections (13) and (16.1)”.

(4) Section 5 of the Regulation is amended by adding the following subsection:

(16.3) For a report that is the first valuation report with a valuation date on or after December 31, 2017 that is filed or submitted on or after May 1, 2018, the definition of “C” in subsection (16) shall be read as if “and if section 55.1 of the Act did not apply” was added at the end.

(5) Subsection 5 (16.3) of the Regulation, as made by subsection (4), is revoked.

7. (1) The Regulation is amended by adding the following section:

Letters of credit, deemed reduced solvency deficiency

5.1 (1) For the purposes of applying sections 5.2 to 5.5 and Schedule 4, special payments described in clause 5 (1) (e) or clause 5 (1.0.0.1) (g), (h) or (i) to which a letter of credit relates are deemed to be special payments described in clause 5 (1.0.0.1) (f).

(2) For the purposes of applying section 55.2 of the Act, a letter of credit in respect of a solvency deficiency or consolidated prior solvency deficiency is deemed to be in respect of a reduced solvency deficiency.

(2) Section 5.1 of the Regulation, as made by subsection (1), is revoked.

8. Paragraph 4 of subsection 5.2.1 (2) of the Regulation is revoked.

9. Subsection 5.4 (1) of the Regulation is amended by striking out “clause 5 (1) (e)” and substituting “clause 5 (1.0.0.1) (f)”.

10. (1) Subsection 6.0.4 (2) of the Regulation is amended by striking out “Section 3.0.1, subsections 5 (1.0.0.1), 6 (4.1), (4.2) and (4.3), section 7.0.1” at the beginning and substituting “Subsections 5 (1.0.0.1), 6 (4.1), (4.2) and (4.3) and 7 (1.1), section 7.0.1”.

(2) Section 6.0.4 of the Regulation is amended by adding the following subsections:

(2.0.1) Subsection 78 (7) does not apply to a specified �������� multi-employer pension plan.

(2.0.2) Section 14.0.1 of the Act does not apply to a specified �������� multi-employer pension plan.

11. The Regulation is amended by adding the following section after the heading “Actuarial Gain, Going Concern Excess and Contribution Holiday”:

Non-application, s. 55.1 of Act

6.3 Section 55.1 of the Act does not apply in respect of the following:

1. A jointly sponsored pension plan listed in subsection 1.3.1 (3) of this Regulation.

2. A pension plan for which the valuation date of the last filed report is before December 31, 2017.

3. A pension plan for which the last filed report was filed before May 1, 2018.

12. (1) Section 7 of the Regulation is amended by adding the following subsections:

(3.1.1) Subsections (3) and (3.1) do not apply in respect of a report that discloses an actuarial gain under the plan if the valuation date of the report is on or after December 31, 2017 and the report is filed or submitted on or after May 1, 2018, unless the report is in respect of a jointly sponsored pension plan listed in subsection 1.3.1 (3).

. . . . .

(4) The requirement set out in clause (3.1) (a) is deemed to be satisfied if the administrator files with the Superintendent an actuarial cost certificate on or before June 30, 2019 for a fiscal year beginning on or after July 1, 2018.

(5) Subject to subsection (6), in any fiscal year for which no special payments are required under section 5 and during which no special payments are deferred under subsection 5 (1.0.1), any actuarial gain not applied under subsection (1) or (3) may be applied to pay the annual assessment to the Guarantee Fund otherwise required by subsection 37 (1) to be paid by the employer.

(6) Subsection (5) applies only in respect of a fiscal year covered by,

(a) a report with a valuation date before December 31, 2017; or

(b) a report that is filed or submitted before May 1, 2018.

(2) Subsection 7 (4) of the Regulation, as made by subsection (1), is revoked.

13. (1) Subsection 7.0.3 (1) of the Regulation is amended by striking out “first report filed on or after December 31, 2017” and substituting “first report filed on or after May 1, 2018 with a valuation date on or after December 31, 2017”.

(2) Subsection 7.0.3 (5) of the Regulation is revoked and the following substituted:

(5) If a report has been filed under section 3 or 14 or submitted under section 4 with a valuation date that is not earlier than the day immediately before the beginning of the fiscal year in which the report is filed or submitted, and the report sets out available actuarial surplus, clauses (3) (a) and (4) (b) do not apply with respect to the portion of the fiscal year that begins on the first day of the period covered by the report and ends on the last day of the fiscal year.

14. Subsection 7.1 (3) of the Regulation is amended by adding “on or after May 1, 2018” after “a fiscal year following a report filed” in the portion before paragraph 1.

15. (1) Paragraph 4 of subsection 8 (3) of the Regulation is revoked and the following substituted:

4. One of the following statements:

i. if the plan is a public sector pension plan, a statement that the reduction of contributions will not reduce the estimated solvency ratio of the pension plan to less than 1.05, or

ii. if the plan is not a public sector pension plan, a statement that the reduction of contributions will not reduce the estimated transfer ratio of the pension plan to less than 1.05.

(2) Section 8 of the Regulation is amended by adding the following subsection:

(5) Despite subsection (4), where subsection 7.0.3 (5) applies and the planned reduction is to occur more than six months after the start of a fiscal year, the notice must be given within six months following the end of the fiscal year in which the planned reduction is to occur.

16. Section 9 of the Regulation is amended by striking out “normal cost” and substituting “normal costs”.

17. (1) The definition of “closed plan” in subsection 11.2 (1) of the Regulation is revoked and the following substituted:

“closed plan” means a pension plan,

(a) that has no members who are entitled to defined benefits, or

(b) in which at least 25 per cent of the members of the plan who are entitled to defined benefits are in a class or classes of employees from which new members are not permitted, according to the terms of the plan, to join the plan and accrue defined benefits; (“régime fermé”)

(2) The definition of “A” in subsection 11.2 (2) of the Regulation is amended by striking out “0.05 for a closed plan and 0.04 for a plan that is not a closed plan” and substituting “0.05 for a pension plan that is a closed plan on the valuation date and 0.04 for a pension plan that is not a closed plan on that date”.

(3) Subsection 11.2 (9) of the Regulation is amended by revoking the portion before paragraph 1 and substituting the following:

(9) In determining the values of “L” and “P” in subsection (8), any portion of a target asset allocation for an investment category listed in paragraph 4, 15 or 16 of subsection 76 (12) shall not be included unless the following criteria are met:

. . . . .

(4) Paragraph 1 of subsection 11.2 (9) of the Regulation is amended by striking out “target investment allocations of fixed income assets in the investment category that is given by a credit rating agency” and substituting “target asset allocations of fixed income assets in the investment category, or the portion thereof, that is given by a credit rating agency”.

(5) Paragraph 2 of subsection 11.2 (9) of the Regulation is amended by striking out “At the time at which the values of “L” and “P” are determined” at the beginning and substituting “As of the valuation date referred to in subsection (2)”.

(6) Section 11.2 of the Regulation is amended by adding the following subsections:

(9.1) Any portion of a target asset allocation excluded from the value of “L” in subsection (8) in accordance with subsection (9) shall be included in the value of “M” in subsection (8).

(9.2) Any portion of a target asset allocation excluded from the value of “P” in subsection (8) in accordance with subsection (9) shall be included in the value of “Q” in subsection (8).

(7) Subsection 11.2 (10) of the Regulation is amended by striking out “at the time at which the determination is made” at the end and substituting “as of the valuation date referred to in subsection (2)”.

(8) Subsection 11.2 (12) of the Regulation is amended by striking out “the plan’s actual asset allocation for an investment category listed in paragraph 4, 15 or 16 of subsection 76 (12) shall not be included unless, at the time at which the determination is made” and substituting “any asset in an investment category listed in paragraph 4, 15 or 16 of subsection 76 (12) shall not be included unless, as of the valuation date referred to in subsection (2)”.

(9) Section 11.2 of the Regulation is amended by adding the following subsections:

(12.1) Any asset in the actual asset allocation excluded from the value of “L” in subsection (8) in accordance with subsection (12) shall be included in the value of “M” in subsection (8).

(12.2) Any asset in the actual asset allocation excluded from the value of “P” in subsection (8) in accordance with subsection (12) shall be included in the value of “Q” in subsection (8).

18. Subsection 37 (1) of the Regulation is amended by striking out “subject to subsection 7 (4)” and substituting “subject to subsections 7 (5) and 7.0.3 (2)”.

19. Subclause 40 (1) (u) (v) of the Regulation is amended by striking out “or reduced solvency deficiency”.

20. Subclause 40.1 (1) (r) (iii) of the Regulation is amended by striking out “or reduced solvency deficiency”.

21. Subclause 40.2 (1) (q) (iii) of the Regulation is amended by striking out “or reduced solvency deficiency”.

22. (1) Paragraph 11 of subsection 47.9 (4) of the Regulation is revoked and the following substituted:

11. Subsections 7 (1.1) and (3.1.1).

(2) Subsection 47.9 (4) of the Regulation is amended by adding the following paragraph:

21. Subsection 78 (7).

23. (1)�� Subsection 78 (7) of the Regulation is amended by adding “for assets in respect of defined benefits” after “target asset allocation”.

(2) Section 78 of the Regulation is amended by adding the following subsection:

(7.1) Subsection (7) does not apply with respect to a jointly sponsored pension plan listed in subsection 1.3.1 (3).

24. (1)�� Subparagraph 1 i of section 3 of Schedule 4 to the Regulation is amended by striking out “clause 5 (1) (e)” and substituting “clause 5 (1.0.0.1) (f)”.

(2) Sub-subparagraph 6 iv B of subsection 4 (1) of Schedule 4 to the Regulation is amended by adding “or (2.1)” after “subsection (2)”.

(3) Subsection 4 (2) of Schedule 4 to the Regulation is amended by adding “or submitted” after “filed” in the portion before the definition of “A”.

(4) Subsection 4 (2.1) of Schedule 4 to the Regulation is amended by striking out “filed under section 3 or 14 or submitted under section 3 or 13” in the portion before the definition of “A” and substituting “that is filed or submitted on or after May 1, 2018 under section 3, 4, 13 or 14”.

Commencement

25. (1) Subject to subsections (2), (3) and (4), this Regulation comes into force on the day it is filed.

(2) Subsections 6 (3) and (5) come into force on February 1, 2022.

(3) Subsection 7 (2) comes into force on May 1, 2029.

(4) Subsection 12 (2) comes into force on January 1, 2020.

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