Pensions Authority compliance alert: Use of parallel or additional contracts by Personal Retirement Savings Account (PRSA) providers in the operation of their PRSA products
Monday 21 September 2020: It has come to the attention of the Authority that some PRSA providers may be operating their PRSA products in a manner which requires the contributor to enter into an additional or parallel contractual arrangement with a third party service provider.
Pursuant to section 102 of the Pensions Act, 1990, as amended, a PRSA contract is entered into between the PRSA provider and the contributor. Additional or parallel contracts between the PRSA contributor and third parties are not consistent with a compliant PRSA contract or product.
The provision of services necessary to the PRSA, including contribution processing and investment, must be included in the PRSA contract and not in any separate arrangements. For the avoidance of doubt, PRSA charges should include any charges that arise through the use of third party service providers and must be expressed in line with the requirements of section 104 of the Act.
The Authority will be undertaking a compliance exercise in Q1 2021 to ascertain if providers are operating any of their PRSA products in this manner. PRSA providers who are found to be operating their PRSA products in a manner which requires the contributor to enter into an additional or parallel contractual arrangement with a third party service provider and have not engaged with the Authority, may be subject to sanctions. The Authority expects PRSA providers operating in this manner to take the necessary steps to rectify the matter as soon as possible.
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For further information, contact:
Technical Unit
The Pensions Authority
Tel: (01) 613 1900
Note to Editors
The Pensions Authority
The Pensions Authority is the statutory body established by the Pensions Act 1990 to regulate occupational pension schemes, trust based RACs and Personal Retirement Savings Accounts (PRSAs) and to advise the Minister for Employment Affairs and Social Protection on overall pension policy development.