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Solvency Funding Relief Regulations, 2009 (SOR/2009-182)

Regulations are current to 2020-09-09 and last amended on 2015-04-01. Previous Versions

Application (continued)

  •  (1) Plans may only be funded under these Regulations if all of the payments that are owed to the pension fund before the day on which the deficiency emerges, as required by subsection 9(14) of the Pension Benefits Standards Regulations, 1985, have been made as at the filing date of the actuarial report that shows the emergence of that deficiency.

  • (2) Despite section 8 of the Pension Benefits Standards Regulations, 1985, the funding of a plan shall be considered to meet the standards for solvency if the funding is in accordance with Part 1, 2 or 3 of these Regulations.

PART 1Funding

General Funding Rules

  •  (1) Despite subsection 9(4) of the Pension Benefits Standards Regulations, 1985 and section 13 of the Air Canada Pension Plan Solvency Deficiency Funding Regulations, a solvency deficiency, as defined in subsection 9(1) of the Pension Benefits Standards Regulations, 1985, of a plan that emerged at the end of the 2008 plan year may be funded in accordance with section 9 of those Regulations but the remittance to the pension fund of a portion of the special payments determined in accordance with those Regulations may be made in accordance with subsection (2) or (3), as the case may be.

  • (2) If the actuarial report that values the plan as at the end of the 2008 plan year indicates that there is a 2008 solvency deficiency and that there is a solvency deficiency as defined in subsection 9(1) of the Pension Benefits Standards Regulations, 1985, a portion of the special payments determined in accordance with subsection 9(4) of those Regulations or section 13 of the Air Canada Pension Plan Solvency Deficiency Funding Regulations may be paid to the pension fund as if the 2008 solvency deficiency were funded by special payments sufficient to liquidate the 2008 solvency deficiency by equal annual payments over a period not exceeding 10 years from the day on which the 2008 solvency deficiency emerged.

  • (3) If the actuarial report that values the plan as at the end of the 2008 plan year indicates that there is no 2008 solvency deficiency but that there is a solvency deficiency as defined in subsection 9(1) of the Pension Benefits Standards Regulations, 1985, the special payments determined in accordance with subsection 9(4) of those Regulations or section 13 of the Air Canada Pension Plan Solvency Deficiency Funding Regulations may be paid to the pension fund provided that those special payments result in the solvency shortfall being funded and liquidated over a period not exceeding 10 years from the day on which the solvency shortfall was calculated.

  • (4) For the purposes of subsection 8(1) of the Act, if the 2008 solvency deficiency or solvency shortfall, as the case may be, is calculated by valuing the assets of a plan in excess of 110% of market value as at the date on which the valuation that identified the 2008 solvency deficiency or solvency shortfall was performed, the amount by which the aggregate amount of special payments calculated using a value of assets equal to 110% of market value on that date exceeds the aggregate amount of special payments calculated using a value of assets in excess of 110% of market value on that date shall be considered to be an amount accrued to the pension fund.

  • (5) The amount that was accrued as a result of subsection (4) is considered to have been paid to the plan at the end of the fifth plan year after the end of the 2009 plan year by special payments that have been calculated in accordance with these Regulations and section 9 of the Pension Benefits Standards Regulations, 1985 provided that all those payments have been made to the fund by the end of that plan year.

  • (6) If the funding is for a deficiency of a multi-employer pension plan and if the annual amount of the payments required to be made to the pension fund in accordance with subsection (2) or (3), as the case may be, is less than the aggregate amount of the payments that are required to be made to the pension fund, excluding the normal cost and the special payments required to liquidate an unfunded liability, under all applicable collective agreements, the amount of the payments required to be made to the pension fund in accordance with subsection (2) or (3), as the case may be, shall be the aggregate amount of the payments required to be made to the pension fund under all applicable collective agreements and subsection (4) shall not apply.

  • SOR/2010-149, s. 17

 Before funding the deficiency in accordance with this Part, the administrator shall file the following documents with the Superintendent:

  • (a) written notification that the deficiency is to be funded in accordance with section 5; and

  • (b) the actuarial report valuing the plan as at the day on which the deficiency emerged.

 For the purposes of paragraph 10.1(2)(b) of the Act, the prescribed solvency ratio level for the 2009 plan year is the solvency ratio calculated on the basis of the actuarial report that reported the deficiency.

  • SOR/2011-85, s. 24

Non-application of Parts 2 and 3

  • SOR/2010-149, s. 18

PART 2Continuation of 10-year Funding

General Funding Rules

 For the purposes of this Part,

  • (a) despite paragraph 9(4)(c) of the Pension Benefits Standards Regulations, 1985, if there is a solvency deficiency, a plan shall be funded in each plan year by annual solvency special payments equal to the amount by which the solvency deficiency divided by 5 exceeds the amount of going concern special payments — other than those referred to in paragraph 14(1)(c) — that are payable during the plan year; and

  • (b) unfunded liability means

    • (i) the going concern deficit of a plan as determined on the date that the plan was established;

    • (ii) the amount by which an increase in the going concern liabilities of a plan resulting from an amendment to the plan exceeds the going concern excess of the plan as determined on the day before the effective date of the amendment; or

    • (iii) the amount by which the going concern deficit of a plan determined at the valuation date exceeds the sum of

      • (A) the present value of going concern special payments established in respect of periods after the valuation date, and

      • (B) the present value of special payments referred to in paragraph 14(1)(b).

  • SOR/2010-149, s. 19
  •  (1) The deficiency of a plan may continue to be funded in accordance with Part 1 after the 2009 plan year only if less than one third of the members and less than one third of the beneficiaries excluding members object before the date indicated in the statement referred to in paragraph 10(1)(j).

  • (2) Any objection expressed by a beneficiary representative on behalf of the persons that they represent shall be counted as a separate objection for each person that they represent.

  • SOR/2015-60, s. 42(F)

Information To Be Provided to Beneficiaries

  •  (1) Subject to subsection (2), the administrator shall provide the following information to the beneficiaries:

    • (a) the solvency ratio of the plan as at the day on which the deficiency funded in accordance with section 5 emerged;

    • (b) the amount of the deficiency to be funded in accordance with this Part;

    • (c) a description of the extent to which the beneficiaries’ benefits would be reduced if the plan were fully terminated and wound up with the solvency ratio referred to in paragraph (a);

    • (d) a statement indicating that extending the period for funding the deficiency as permitted by this Part may result in a lower value of the plan assets during the funding period than would be the case if the deficiency were funded over a period not exceeding five years and that the longer funding period may also extend the period during which the plan assets are less than the plan liabilities;

    • (e) the special payments that would have been made during the first plan year covered by the actuarial report referred to in paragraph 6(b) if the deficiency were to be funded in accordance with section 9 of the Pension Benefits Standards Regulations, 1985;

    • (f) the special payments in respect of the deficiency that will be made during the 2009 plan year;

    • (g) [Repealed, SOR/2015-60, s. 43]

    • (h) a statement indicating that the plan may continue to be funded in accordance with this Part following the 2009 plan year end only if less than one third of the members object and less than one third of the beneficiaries excluding members object;

    • (i) a statement indicating that the Superintendent’s approval is not required to fund the deficiency in accordance with this Part;

    • (j) a statement indicating that the beneficiaries may object to the proposal to fund the plan in accordance with this Part by sending an objection to the administrator at the address and by the date indicated in the statement, which date shall not be less than 30 days after the day on which the other information required to be provided under this subsection is provided by the administrator;

    • (k) a statement indicating that amendments to the plan that increase the pension benefits have been restricted during the 2009 plan year and that, if the deficiency of the plan is funded in accordance with this Part, those benefits will continue to be restricted for the following four plan years of funding following the 2009 plan year end; and

    • (l) a statement setting out the right of access to the documents described in paragraph 28(1)(c) of the Act.

  • (2) If a beneficiary is represented by a beneficiary representative, the administrator shall provide the information set out in subsection (1) to the beneficiary representative.

  • SOR/2015-60, s. 43
 
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