The Confederation of Employers and Industrialists in Bulgaria, in principle, supports the proposal sent by the Commission for Financial Supervision to amend and supplement the Social Security Code and proposed for discussion in the Commission on Insurance Relations of the National Council for Tripartite Cooperation. At the same time, we have the following notes and suggestions:
I. ON THE PROPOSALS UNDER PART ONE:
1. In § 3, a new item 5 is added with the following content:
"5. paragraph 11 is amended as follows:
(11) On the funds for social expenses, given permanently or periodically directly to the persons under Art. 4, para. 1 in cash or in kind, insurance contributions are made in the amount for the "Pensions" fund, determined respectively according to the order of para. 3, 4 and 5. Insurance contributions are not calculated and paid on contributions for additional voluntary pension insurance, contributions for voluntary health insurance and voluntary insurance for unemployment and professional qualification, on expenses for "life" insurance, "pension" insurance, "annuity" insurance ", "accident" insurances, health insurances, as well as on insurance costs defined as mandatory by a regulatory act."
2. In § 14, Article 40a acquires the following wording:
"Deadlines for submission of documents for payment of compensation for temporary incapacity for work or employment
Art. 40a. The documents for the payment of cash compensation for temporary incapacity for work or employment are submitted to the relevant territorial division of the National Social Security Institute within the following terms:
1. by employers, insurers and their branches and divisions - for each calendar month no later than seven days after the day of payment of the due remuneration or a part thereof, and when the remuneration has been accrued but not paid - no later than no later than seven days after the last day of the month in which the accrual was made or according to a schedule determined by the relevant territorial division of the National Social Security Institute. "
II. ON THE PROPOSALS UNDER PART TWO, TITLE ONE, CHAPTER NINE OF CSR:
1. The proposals of the FSC, related to the introduction of new requirements for shareholders, members of the management and control bodies of the pension insurance company, internal control, issuance and revocation of a license, etc., should be motivated by the importers, since without we deny the need for these changes, we are not convinced that the proposed texts are the most appropriate. The reference shows that most of the new provisions are borrowed from the Insurance Code and the Law on Credit Institutions.
2. In this regard, we consider that there are no grounds for introducing the restriction under Art. 121e, para. 8 of CSR.
3. In addition, the proposals related to the introduction of higher requirements for the members of the management and control bodies, the shareholders of the pension insurance companies are contradictory, since on the one hand stricter requirements are introduced for them, and on the other hand the restriction is removed shareholders to hold shares in only one pension insurance company. We believe that this requirement should remain, adding that the ban on owning shares also applies to cases where it is done through persons related to the shareholder.
If the FSC's proposal to change Art. 121b, para. 2 of CSR, the existence of the limitation under Art. 121e, para. 1, item 7 of the CSR for the members of the management and control bodies of the pension insurance company.
4. The proposals concerning insurance intermediaries introduce very serious requirements for the exercise of this activity, for which there are also no reasons, on the one hand, and on the other hand, the texts related to the training and the certificate issued are not coordinated with the Law on Professional Education and training.
We do not support the proposals to create a new para. 22 of Art. 123d of CSR and to change art. 122e, para. 2, item 4 of the CSR, with which the pension insurance company is charged with full responsibility for the actions of its insurance intermediaries.
5. In Art. 121c of the CSR, an explicit text should be written that the requirements for a higher amount of the registered capital, the guarantee capital and the solvency limit must be present when the pension insurance company starts paying life pensions or term pensions with a guaranteed amount and in this connection in art. 121c, para. 5, item 1, the words "can be".
6. We do not understand what the reasons are for introducing the requirement of Art. 123h, para. 8 of CSR. Does this mean that the supervisory authority will rely only on this information when carrying out its activities?
The FSC should monitor ex officio for the existence of connectivity in the sense of CSR, based on information from official, independent sources.
7. We categorically do not accept the proposal under Art. 123i, para. 2, as well as in other texts of the CSR, pension insurance companies should include in their advertising information materials and other documents issued by them, a text that they do not guarantee the full amount of funds contributed to a voluntary pension fund.
The requirement introduced by this proposal contradicts the essence of supplementary pension insurance and distorts the perception of this type of activity among current and potential clients of supplementary pension insurance funds.
Bearing in mind the long-term nature of the supplementary pension insurance, which in the case of mandatory funds and in the case of voluntary insurance by an employer, is also associated with a legal restriction on receiving the funds before the occurrence of the relevant insurance event, this statement is not true and misleads the insured persons.
It should also be taken into account the fact that in the management of the funds for additional mandatory pension insurance, there is also a requirement to achieve a minimum yield and to have reserves to guarantee it.
The proposal of the FSC, in our opinion, is based on purely conjunctural considerations, in view of the current problems of the stock exchange. In addition, due to the high yield of the stock market before the current crisis, some of the pension fund clients made large lump sum contributions just for the yield, without any idea of providing for an additional pension.
It should be borne in mind that there will always be fluctuations in the stock market, as well as individuals who will contribute to a voluntary pension fund with the sole purpose of increasing their savings. However, this should not be a reason for the exceptions and problems accompanying developing financial markets to become a basis for creating regulations. Such an approach rather distorts the insurance market than contributes to its development, through regulations that eliminate the opportunities for the creation of bad practices.
The approach proposed by the FSC equates voluntary pension insurance with investing through contractual funds, provided that the current problems with insured persons who are dissatisfied with the results achieved by voluntary pension funds stem precisely from the lack of awareness of the specifics of each activity.
Indeed, there is a requirement for mutual funds' advertising materials to contain a warning similar to that offered by the FSC, but even for them the wording is not as drastic and off-putting to potential clients. It should be taken into account, however, that the presence of such an entry in the advertising of contractual funds stems from the requirement of a European directive regulating their activity, while for voluntary pension insurance at the level of European legislation, such a requirement does not exist, at least for us for obvious reasons , bearing in mind the specifics of the supplementary pension insurance activity set out above.
ІII. ON THE PROPOSALS UNDER PART TWO, TITLE TWO, CHAPTER TEN OF CSO
1. In view of the existing problems in connection with the change of participation and the transfer of funds from one to another relevant fund for additional pension insurance, we do not find the proposals to change Art. 171 of CSR, which also applies to Art. 247 of CSR. The proposals do not solve the main problems that currently exist in relation to the transfer of funds from one to another relevant supplementary pension fund.
2. The tests of Art. 174 and the proposal to create art. 248c of the CSR, should be combined in one text to be included in chapter nine, since the texts have identical content and are unnecessarily repeated.
3. It is particularly interesting for us to understand the reasons for the addition in Art. 175, para. 1 and in other texts of CSR, the word "entirely".
4. We do not understand the reasons for changing Art. 193, para. 11 of CSR and the version proposed by the FSC. If the idea is to limit the investment of the funds from the reserve in financial instruments issued by persons related to the pension insurance company, a direct ban on this should be introduced.
5. We categorically do not support the proposal under Art. 201, para. 1, item 2 and art. 202, para. 1 of the CSR to reduce the amount of the investment fee and the fee for changing participation.
Such a proposal should be accompanied by detailed calculations and calculations to justify its introduction, and not simply cite foreign legislation, taking into account only the amount of the fee, as an absolute value, without taking into account the amount of the insurance contribution and the income of the population.
ІV. ON THE PROPOSALS UNDER PART TWO, TITLE THREE OF KSO
1. For the reasons stated above, we categorically do not accept the inclusion in the legal text of the proposed in Art. 209, para. 4 wording that the risk of change in the value of investments is borne by the insured person or the pensioner.
2. We do not agree with the proposals made by the FSC that the insured persons conclude a separate contract for each investment portfolio in which they participate, as well as to have a separate lot in it.
In addition, we consider absolutely unacceptable and practically inapplicable the proposal that the funds from insurance contributions go directly to the account of the investment portfolio in which the person participates. In this way, the responsibility for the correct transfer of the contributions is transferred entirely to the insured person or the insurers, which will create enormous difficulties for them and, accordingly, problems for the companies with the regularity of the receipts from insurance contributions, from which the insured persons will ultimately lose income. We insist that the proposal of BADDPO be accepted that these funds go into a general account of the voluntary pension fund and that the company allocates them to the accounts of the investment portfolio or portfolios in which the insured person participates.
3. In Art. 213 of the CSR should explicitly state that the formation of the pension and technical reserves starts from the moment of payment of fixed-term pensions with a guaranteed amount or lifetime pensions. In addition, it is necessary to clearly indicate that the technical reserves are allocated to the voluntary pension fund.
We consider the existence of separate texts on the formation of separate texts on the formation of reserves for voluntary pension insurance under an occupational scheme to be unjustified, provided that the principles for the formation of reserves are identical, therefore the restriction on insurance under an occupational scheme in Bulgarian should be removed. insurance company to offer only term pensions.
4. We categorically do not accept the proposals under Art. 232, para. 2 of the CSR, which changes the principles of insurance under professional schemes, such as a single insurance contribution, regardless of the way it is formed, the way of participation in the professional scheme, the way of paying the insurance contribution, etc.
5. We do not accept the proposal under Art. 235, para. 3, ex. second of the CSR, which obligates the insurers to collect and provide the pension insurance companies with the written consents of the persons who will be insured under the contract concluded by them.
6. The texts that regulate the status and rights of the third beneficiary should also apply to the insured person, and not only to the pensioner, since the order and method of inheriting the funds under the individual lot of an insured person and a pensioner, as well as their rights should be the same.
In Art. 246b, para. 4 should be deleted, as we consider that the third beneficiary should always be explicitly indicated with their three names and social security number.
7. We categorically do not accept the proposal to drop the possibility of paying inheritance pensions. It is necessary to supplement the existing texts, providing for the possibility of paying lifetime inheritance pensions, including to the heirs of a pensioner.
8. In Art. 246c should be specified when comparing the amount of the pension with that of the minimum wage, on which date this assessment is made, insofar as the amount of the minimum wage is a variable value.
9. We believe that the texts on the investment regime needlessly repeat those on supplementary mandatory pension insurance funds. In our opinion, the current texts, which regulate only the differences in voluntary pension funds, should be preserved, making the necessary additions to them, as well as explicitly providing that the requirements and restrictions apply to the investment portfolios, and not to the fund, as a whole .
10. We do not support the proposal to change the amount of the fee for transferring funds from one voluntary pension fund to another, as in Art. 258 should introduce a similar limitation, which is proposed in Art. 202 of the CSR for mandatory funds, that the transfer fee cannot be deducted from the funds of the individual account of the insured person.
V. TRANSITIONAL AND FINAL PROVISIONS OF CSR
1. We believe that the proposal of BADDPO should also be included, and an opportunity should be provided during the initial separation of investment portfolios in the existing voluntary pension funds to transfer assets between the created portfolios, in cases where a significant amount of funds are transferred from one to another wallet.
2. In this connection, the text of § 108, para. 6, as it would create problems, especially in a situation of rapidly changing value of a unit of the voluntary pension fund.
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