O. Reg. 329/12: GENERAL
filed November 1, 2012 under Pension Benefits Act, R.S.O. 1990, c. P.8
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made under the
pension benefits act
Made: October 31, 2012
Filed: November 1, 2012
Published on e-Laws: November 2, 2012
Printed in The Ontario Gazette: November 17, 2012
Amending Reg. 909 of R.R.O. 1990
(general)
1. (1) Clause 1.2 (1) (b) of Regulation 909 of the Revised Regulations of Ontario, 1990 is revoked.
(2) Clause 1.2 (1) (d) of the Regulation is revoked and the following substituted:
(d) the present value of all special payments referred to in clause 5 (1) (b) or (e) that are scheduled for payment within the following period, other than special payments required to liquidate any past service unfunded liability or any solvency deficiency determined in the report:
(i) the period of five years that begins on the valuation date of a report with a valuation date before September 30, 2011, in the case of a pension plan that is not a jointly sponsored pension plan,
(ii) a period that begins on the valuation date of a report with a valuation date on or after September 30, 2011 and continues until the end of a five-year period that begins on a date not later than 12 months after the valuation date, in the case of a pension plan that is not a jointly sponsored pension plan,
(iii) a period that begins on the valuation date of the report and continues until the end of a five-year period that begins on a date not later than 12 months after the valuation date, in the case of a jointly sponsored pension plan.
(3) The definition of “C” in subsection 1.2 (2) of the Regulation is revoked and the following substituted:
“C” is the present value of the required contributions for the following period, which are determined using the actuarial cost method adopted by the plan:
(a) the five-year period that begins on the valuation date of a report with a valuation date before September 30, 2011, in the case of a pension plan that is not a jointly sponsored pension plan,
(b) a period that begins on the valuation date of a report with a valuation date on or after September 30, 2011 and continues until the end of a five-year period that begins on a date not later than 12 months after the valuation date, in the case of a pension plan that is not a jointly sponsored pension plan, or
(c) a period that begins on the valuation date of the report and continues until the end of a five-year period that begins on a date not later than 12 months after the valuation date, in the case of a jointly sponsored pension plan,
2. (1) Clause 4 (2) (c.1) of the Regulation is revoked and the following substituted:
(c.1) all special payments determined in accordance with sections 5.6 and 5.6.1; and
(2) Paragraphs 1 and 1.1 of subsection 4 (2.3) of the Regulation are revoked.
(3) Paragraph 1.2 of subsection 4 (2.3) of the Regulation is amended by striking out “If the valuation date of a report filed under section 3, 13 or 14 is on or after December 31, 2006 and, at the valuation date, the amount determined under clause (a) of the definition of “going concern assets” in subsection 1 (2)” at the beginning and substituting “If, at the valuation date of a report filed under section 3, 13 or 14, the amount determined under clause (a) of the definition of “going concern assets” in subsection 1 (2)”.
(4) Paragraph 2.1 of subsection 4 (2.3) of the Regulation is amended by striking out “paragraphs 1, 1.2 and 2” and substituting “paragraphs 1.2 and 2”.
(5) Paragraph 3 of subsection 4 (2.3) of the Regulation is amended by striking out “paragraphs 1, 1.2 and 2” and substituting “paragraphs 1.2 and 2”.
(6) Paragraph 3.1 of subsection 4 (2.3) of the Regulation is amended by striking out “paragraphs 1, 1.2 and 2” and substituting “paragraphs 1.2 and 2”.
(7) Subparagraph 5 i of subsection 4 (2.3) of the Regulation is revoked.
(8) Sub-subparagraph 7 ii A of subsection 4 (2.3) of the Regulation is amended by striking out “if paragraph 1 or 1.2 applies” and substituting “if paragraph 1.2 applies”.
(9) Paragraph 9 of subsection 4 (2.3) of the Regulation is amended by striking out “paragraph 1, 1.2 or 2” and substituting “paragraph 1.2 or 2”.
(10) Subsection 4 (3) of the Regulation is amended by striking out “clauses (2) (b), (c) and (d)” at the end and substituting “clauses (2) (b), (c), (c.1) and (d)”.
3. Section 5 of the Regulation is amended by adding the following subsection:
(1.0.1) Despite clauses (1) (b) and (e), if the valuation date of the report is on or after September 30, 2011, the beginning of the amortization period for special payments to liquidate a solvency deficiency or going concern unfunded liability determined in the report may be deferred to a day that is not later than 12 months after the valuation date.
4. The Regulation is amended by adding the following section after the heading “Solvency Funding Relief”:
5.5.3 (1) In this section and in sections 5.6 to 5.10,
“consolidated prior solvency deficiency” means, in respect of a plan, the amount described in subsection (2); (“déficit de solvabilité antérieur consolidé”)
“eligible former member” means, with respect to a plan, a former member whose deferred pension or pension benefit includes a defined benefit, other than a former member for whom a notice of death has been received by the administrator; (“ancien participant admissible”)
“eligible member” means, with respect to a plan, a member whose pension benefit includes a defined benefit, other than,
(a) a member who no longer has an entitlement to any payments from the plan, and
(b) a member for whom a notice of death has been received by the administrator; (“participant admissible”)
“eligible retired member” means, with respect to a plan, a retired member whose pension or pension benefit includes a defined benefit, other than a retired member for whom a notice of death has been received by the administrator; (“participant retraité admissible”)
“jointly governed plan” means a plan that is,
(a) a jointly sponsored pension plan,
(b) a multi-employer pension plan established pursuant to a collective agreement or a trust agreement,
(c) a plan whose administrator is a pension committee all of whose members are representatives of members of the plan, or
(d) a plan whose administrator is a pension committee described in clause 8 (1) (b) of the Act if at least one-half of the members of the pension committee represent members of the plan or persons receiving pensions under the plan; (“régime à gestion paritaire”)
“new going concern unfunded liability” means, with respect to a plan, a going concern unfunded liability determined in the applicable solvency relief report for the plan; (“nouveau passif à long terme non capitalisé”)
“new solvency deficiency” means, with respect to a plan, a solvency deficiency determined in the applicable solvency relief report for the plan; (“nouveau déficit de solvabilité”)
“Option 1” means the type of solvency relief described in paragraph 1 of subsection 5.6 (3); (“option 1”)
“Option 2” means the type of solvency relief described in paragraph 2 of subsection 5.6 (3); (“option 2”)
“Option 3” means the type of solvency relief described in paragraph 3 of subsection 5.6 (3); (“option 3”)
“Option 4” means the type of solvency relief described in paragraph 1 of subsection 5.6.1 (3); (“option 4”)
“Option 5” means the type of solvency relief described in paragraph 2 of subsection 5.6.1 (3); (“option 5”)
“solvency relief report” means, with respect to a plan, the report referred to in subsection 5.6 (1) or 5.6.1 (1), as the circumstances require. (“rapport sur l’allègement de la capitalisation du déficit de solvabilité”)
(2) The consolidated prior solvency deficiency of a pension plan is the present value, as of the valuation date of the applicable solvency relief report, of all special payments that are required with respect to any solvency deficiency determined in a report under section 3, 13 or 14 that was filed before the solvency relief report is filed and that are scheduled to be paid after the valuation date of the solvency relief report, excluding the following special payments:
1. Special payments required only by reason of section 75 of the Act.
2. Special payments with respect to a solvency deficiency in which the amortization period ends more than five years after the valuation date of the applicable solvency relief report.
5. (1) Subsection 5.6 (1) of the Regulation is revoked and the following substituted:
(1) This section applies with respect to the first report of a pension plan that is filed by the administrator under section 13 or 14 for which the valuation date is on or after September 30, 2008 and before September 30, 2011. However, it does not apply with respect to any excluded plan described in subsection (7).
(2) Paragraph 1 of subsection 5.6 (3) of the Regulation is amended by striking out “If there is” at the beginning and substituting “Option 1: if there is”.
(3) Paragraph 2 of subsection 5.6 (3) of the Regulation is amended by striking out “If a solvency deficiency” at the beginning and substituting “Option 2: if a solvency deficiency”.
(4) Paragraph 3 of subsection 5.6 (3) of the Regulation is amended by striking out “If there is” at the beginning and substituting “Option 3: if there is”.
(5) Subsection 5.6 (4) of the Regulation is revoked and the following substituted:
(4) The following exceptions apply for the purposes of this section:
1. Option 1 is not available for any jointly sponsored pension plan.
2. Option 2 is not available for any pension plan that is a new pension plan as defined in section 1 of Ontario Regulation 202/02 (Algoma Steel Inc. Pension Plans) made under the Act.
3. Option 3 is not available for any pension plan (other than a jointly governed plan),
i. if the administrator does not comply with section 5.7,
ii. if the administrator receives notices of objection representing objections to the election from more than one-third of the persons who are eligible members, eligible former members or eligible retired members described in section 5.7, or
iii. if the administrator fails to file a certificate of consent under section 5.8 in accordance with that section.
(6) Paragraph 1 of subsection 5.6 (6) of the Regulation is amended by striking out “or the amortization period with respect to any solvency deficiency arising after the valuation date of the solvency relief report” in the portion before subparagraph i and substituting “or the amortization period with respect to any other solvency deficiency determined in a report filed under section 3, 13 or 14”.
(7) Sub-subparagraph 1 i C of subsection 5.6 (6) of the Regulation is revoked and the following substituted:
C. the present value of the special payments with respect to any other solvency deficiency determined in a report filed under section 3, 13 or 14.
(8) Sub-subparagraph 1 ii E of subsection 5.6 (6) of the Regulation is revoked and the following substituted:
E. The amortization period for the special payments with respect to any other solvency deficiency determined in a report filed under section 3, 13 or 14.
(9) Paragraph 6 of subsection 5.6 (6) of the Regulation is amended by adding “under section 5.8” after “any certificate of consent”.
(10) Sub-subparagraph 8 iii A of subsection 5.6 (6) of the Regulation is amended by adding at the beginning “for a valuation date before September 30, 2011”.
(11) Subparagraph 8 iii of subsection 5.6 (6) of the Regulation is amended by striking out “and” at the end of sub-subparagraph 8 iii A and by adding the following sub-subparagraph:
A.1 for a valuation date on or after September 30, 2011, the present value of special payments referred to in subsection 5 (1) with respect to any going concern unfunded liability arising on or before the valuation date of the solvency relief report that are scheduled for payment within the period that begins on the valuation date of the subsequent report and ends at the end of the period in which the new solvency deficiency is liquidated or at the end of a five-year period that begins on a day not more than 12 months after the valuation date of the subsequent report, whichever is later, and
. . . . .
(12) The definition of “A” in subparagraph 8.1 iii of subsection 5.6 (6) of the Regulation is revoked and the following substituted:
“A” is the present value of required contributions, determined using the actuarial cost method adopted by the plan, for the period indicated:
a. for a subsequent report with a valuation date before September 30, 2011, for the five-year period that begins on the valuation date of the subsequent report,
b. for a subsequent report with a valuation date on or after September 30, 2011, for the period that begins on the valuation date of the subsequent report and that ends at the end of a five-year period that begins on a day not more than 12 months after the valuation date of the subsequent report,
(13) Subparagraph 10 iv of subsection 5.6 (6) of the Regulation is revoked and the following substituted:
iv. The reference to a five-year period in paragraph a of the definition of “A” in subparagraph 8.1 iii is deemed to be a reference to the period that begins on the valuation date of the subsequent report and that ends at the end of a five-year period that begins on a day not more than 12 months after the valuation date of the subsequent report.
(14) Subsection 5.6 (6.1) of the Regulation is amended by striking out “subparagraph 8.1 iii” at the end of the portion before paragraph 1 and substituting “subparagraph 8.1 iii of subsection (6)”.
(15) Subsections 5.6 (7), (7.1), (8) and (9) of the Regulation are revoked and the following substituted:
(7) The following pension plans are excluded plans for the purposes of this section:
1. A plan that does not provide defined benefits.
2. A plan that was not registered under the Act or under the legislation of a designated jurisdiction before September 30, 2008,
i. unless the plan is deemed under section 80 of the Act to be a continuation of another plan that was registered before that day,
ii. unless the plan is a successor plan described in section 81 of the Act and the original plan was registered before that day, or
iii. unless the plan was formed by the merger of two or more plans and at least one of the original plans was registered before that day.
3. A specified Ontario multi-employer pension plan within the meaning of section 6.0.1.
4. A participating pension plan within the meaning of subsection 1 (1) of Ontario Regulation 99/06 (Stelco Inc. Pension Plans) made under the Act.
5. A plan to which not all of the contributions set out in reports filed under section 3, 13 or 14 that were required to be made before the valuation date of the solvency relief report under this section have been made in accordance with the Act and the regulations.
6. The Regulation is amended by adding the following section:
5.6.1 (1) This section applies with respect to the first report of a pension plan that is filed by the administrator under section 13 or 14 for which the valuation date is on or after September 30, 2011 and before September 30, 2014. However, it does not apply with respect to any excluded plan described in subsection (8).
(2) This section applies despite any other provision of this Regulation and, in particular, despite subsection 5.6 (2).
(3) The administrator of a plan that is not an excluded plan may, subject to this section, elect to use one or both of the following types of solvency relief:
1. Option 4: If a solvency deficiency was determined in a report filed under section 3, 13 or 14 before the solvency relief report under this section is filed and if that solvency deficiency has not been liquidated, the establishment of a new five-year period during which the plan’s consolidated prior solvency deficiency is to be liquidated.
2. Option 5: If there is a new solvency deficiency, the extension of the five-year period during which the new solvency deficiency would otherwise be required to be liquidated for up to an additional five years.
(4) The following exceptions apply for the purposes of this section:
1. Option 4 is not available for any pension plan that is a new pension plan as defined in section 1 of Ontario Regulation 202/02 (Algoma Steel Inc. Pension Plans) made under the Act.
2. Option 5 is not available for any pension plan (other than a jointly governed plan),
i. if the administrator does not comply with section 5.7,
ii. if the administrator receives notices of objection representing objections to the election from more than one-third of the persons who are eligible members, eligible former members or eligible retired members described in section 5.7, or
iii. if the administrator fails to file a certificate of consent under section 5.8 in accordance with that section.
(5) An election under this section must be in writing, may be made only once, cannot be rescinded and must be filed with the Superintendent no later than the day on which the solvency relief report under this section is filed.
(6) If the administrator of a plan makes an election under this section, the following rules apply in the circumstances described in the following paragraphs:
1. If there was a new solvency deficiency or the administrator elected Option 4 and, on a valuation date after the valuation date of the solvency relief report under this section, the sum of the solvency assets and the solvency asset adjustment exceeds the sum of the solvency liabilities, the solvency liability adjustment and the prior year credit balance (such excess being referred to in this paragraph as the “solvency excess”), the special payments or amortization periods under subsection 5 (1) with respect to the consolidated prior solvency deficiency, the consolidated prior solvency deficiency under section 5.6, the new solvency deficiency and the new solvency deficiency under section 5.6 or the amortization period with respect to any other solvency deficiency determined in a report filed under section 3, 13 or 14 may be adjusted in accordance with the following rules:
i. The special payments are reduced to zero if the solvency excess is greater than or equal to the sum of,
A. the present value of the special payments with respect to the new solvency deficiency, if any,
B. the present value of the special payments with respect to the new solvency deficiency determined under section 5.6, if any,
C. if the administrator elected Option 4, the present value of the special payments with respect to the consolidated prior solvency deficiency, if any,
D. if the administrator did not elect Option 4, the present value of the special payments with respect to the consolidated prior solvency deficiency determined under section 5.6, if any,
E. the present value of the special payments with respect to any other solvency deficiency determined in a report filed under section 3, 13 or 14.
ii. If the solvency excess is less than the sum of the present value of the special payments described in sub-subparagraphs i A, B, C, D and E, the solvency excess may be applied to reduce any of the following in order to reduce the solvency excess to zero:
A. The special payments with respect to the new solvency deficiency over the amortization period set out in the solvency relief report.
B. The special payments with respect to the new solvency deficiency determined under section 5.6 over the amortization period set out in the solvency relief report under section 5.6.
C. If the administrator elected Option 4, the special payments with respect to the consolidated prior solvency deficiency over the amortization period set out in the solvency relief report.
D. If the administrator did not elect Option 4, the special payments with respect to the consolidated prior solvency deficiency determined under section 5.6 over the amortization period set out in the solvency relief report under section 5.6.
E. The amortization period for the special payments with respect to the new solvency deficiency.
F. The amortization period for the special payments with respect to the new solvency deficiency determined under section 5.6.
G. If the administrator elected Option 4, the amortization period for the special payments with respect to the consolidated prior solvency deficiency.
H. If the administrator did not elect Option 4, the amortization period for the special payments with respect to the consolidated prior solvency deficiency determined under section 5.6.
I. The amortization period for the special payments with respect to any other solvency deficiency determined in a report filed under section 3, 13 or 14.
2. If the administrator elects Option 4,
i. the consolidated prior solvency deficiency must be liquidated, with interest at the rates described in subsection 5 (2), by equal monthly instalments over a period of five years beginning on the valuation date of the solvency relief report, instead of over the remaining portion of the amortization period or periods that would otherwise apply,
ii. the monthly instalments required to liquidate the consolidated prior solvency deficiency are deemed to be special payments under subsection 5 (1) for the purposes of liquidating a solvency deficiency,
iii. the solvency asset adjustment under clause 1.2 (1) (d) for a new solvency deficiency must include the present value of all special payments required to liquidate any solvency deficiency for which the amortization period ends more than five years after the valuation date of the solvency relief report and to liquidate the consolidated prior solvency deficiency, and
iv. the amount by which “A” exceeds “B” may be applied to reduce the amount of any contributions to be made in accordance with the solvency relief report until the next report under section 3, 13 or 14 is filed and, for the purposes of subsection 37 (12), is deemed not to be an excess special payment, where,
“A” is the amount of the special payments in respect of any solvency deficiency determined in a report filed previously under section 3, 13 or 14 that are made between the valuation date of the solvency relief report and the day the solvency relief report is filed, and
“B” is the amount of the special payments required to be made, between the valuation date of the solvency relief report and the day the solvency relief report is filed, in respect of any solvency deficiency for which the amortization period ends more than five years after the valuation date of the solvency relief report and in respect of the consolidated prior solvency deficiency.
3. Subject to paragraphs 4 and 5, if the plan is not a jointly sponsored pension plan, if the administrator elects Option 4 or Option 5 or both options and if, after the later of the day on which the solvency relief report is required to be filed and any certificate of consent under section 5.8 is required to be filed in respect of the election, the administrator files an amendment to the plan to increase pension benefits or ancillary benefits, any increase in the going concern unfunded liability that results from the amendment must be liquidated, with interest at the going concern valuation interest rate or rates, by special payments determined under section 5 over a period of five years, beginning on the valuation date of the report under section 3 or 14 in which the increase in the going concern unfunded liability is determined.
4. Paragraph 3 does not apply with respect to an increase in a going concern unfunded liability that results from an amendment or a part of an amendment that does not take effect until after the latest of,
i. the day on which the consolidated prior solvency deficiency is liquidated, if the administrator elected Option 4 or both Options 4 and 5,
ii. the day on which the remaining period during which any new solvency deficiency determined under section 5.6 must be liquidated is equal to five years, and
iii. the day on which the remaining period during which the new solvency deficiency must be liquidated is equal to five years, if the administrator elected Option 5 or both Options 4 and 5.
5. Paragraph 3 does not apply with respect to an increase in a going concern unfunded liability that results from an amendment made to confer a benefit improvement that is required by law.
6. If a benefit allocation method is used to set contribution rates for the plan and if the administrator elects Option 5,
i. the period under subsection 5 (1) in which the new solvency deficiency must be liquidated begins on a day that is not more than 12 months after the valuation date of the solvency relief report and ends on a day not more than 10 years after that day,
ii. the solvency asset adjustment under clause 1.2 (1) (d) for the new solvency deficiency must include the present value of all special payments required to be made in respect of any going concern unfunded liability that are scheduled for payment during the period that begins on the valuation date of the solvency relief report and ends at the end of the period referred to in subparagraph i,
iii. subparagraph 8 iii of subsection 5.6 (6) does not apply with respect to the calculation of the solvency asset adjustment, and
iv. the solvency asset adjustment under clause 1.2 (1) (d) for a solvency deficiency determined in a report under section 3 or 14 (called the “subsequent report” in this subparagraph) for a valuation date after the valuation date of the solvency relief report but before the day on which the new solvency deficiency is liquidated or the day on which the new solvency deficiency determined under section 5.6 is liquidated, whichever is later, must include,
A. the present value of special payments referred to in subsection 5 (1) with respect to any going concern unfunded liability arising on or before the valuation date of the solvency relief report that are scheduled for payment within the period that begins on the valuation date of the subsequent report and ends at the end of the period in which the new solvency deficiency determined under section 5.6 is liquidated, at the end of the period in which the new solvency deficiency is liquidated or at the end of a five-year period that begins on a day not more than 12 months after the valuation date of the subsequent report, whichever is the latest, and
B. the present value of special payments with respect to the new solvency deficiency and the new solvency deficiency determined under section 5.6, if applicable, that are scheduled for payment within the period that begins on the valuation date of the subsequent report and ends at the end of the period in which the new solvency deficiency is liquidated or the end of the period in which the new solvency deficiency determined under section 5.6 is liquidated, whichever is later.
7. If a benefit allocation method is not used to set contribution rates for the plan and the administrator elects Option 5,
i. the period under subsection 5 (1) in which the new solvency deficiency must be liquidated begins on a day that is not more than 12 months after the valuation date of the solvency relief report and ends on a day not more than 10 years after that day,
ii. the solvency asset adjustment under subsection 1.2 (2) for the new solvency deficiency must be determined as if “C” in the definition of “B” in that subsection were the present value of the required contributions, which are determined using the actuarial cost method adopted by the plan, for the period that begins on the valuation date of the solvency relief report and ends at the end of the period referred to in subparagraph i,
iii. subparagraph 8.1 iii of subsection 5.6 (6) does not apply with respect to the calculation of the solvency asset adjustment, and
iv. the solvency asset adjustment under subsection 1.2 (2) for a solvency deficiency determined in a report under section 3 or 14 (called the “subsequent report” in this subparagraph) for a valuation date that is after the valuation date of the solvency relief report but before the new solvency deficiency is liquidated or before the new solvency deficiency determined under section 5.6 is liquidated, whichever is later, must be determined as if “B” in that subsection is the greater of zero and the amount calculated using the formula,
A + B – C + D
in which,
“A” is the present value of required contributions, determined using the actuarial cost method adopted by the plan, for the period that begins on the valuation date of the subsequent report and ends at the end of a five-year period that begins on a day not more than 12 months after the valuation date of the subsequent report,
“B” is the present value of any special payments described in clause 5 (1) (e), other than special payments required to liquidate a solvency deficiency determined in the subsequent report,
“C” is the present value of the normal cost, which is determined using a benefit allocation method, for the period described in the definition of “A”, and
“D” is zero, if the period defined as “E” ends not later than the end of the period described in the definition of “A” or, if the period defined as “E” ends after the end of the period described in the definition of “A”, “D” is the lesser of “F” and “G”, where,
“E” is the period that begins on the valuation date of the subsequent report and ends at the end of the period in which the new solvency deficiency is liquidated, or at the end of the period in which the new solvency deficiency determined under section 5.6 is liquidated, whichever is later,
“F” is the amount by which the difference between the present value of required contributions, determined using the actuarial cost method adopted by the plan, for the period defined as “E” and the amount of “A” exceeds the difference between the present value of the normal cost, determined using a benefit allocation method, for the period defined as “E” and the amount of “C”, and
“G” is the amount by which the present value of the imputed going concern special payments for the period defined as “E” exceeds the present value of the imputed going concern special payments for the period described in the definition of “A”.
8. Subject to paragraphs 9 and 10, if the plan is a jointly sponsored pension plan, if the administrator elects Option 4 or Option 5 or both options and if, after the day the solvency relief report is required to be filed, the administrator files an amendment to the plan to increase pension benefits or ancillary benefits, any increase in the going concern unfunded liability that results from the amendment must be liquidated, with interest at the going concern valuation interest rate or rates, by special payments determined under section 5 over a period of five years, beginning not later than 12 months after the valuation date of the report under section 3 or 14 in which the increase in the going concern unfunded liability is determined.
9. Paragraph 8 does not apply with respect to an increase in a going concern unfunded liability that results from an amendment or part of an amendment that does not take effect until after the latest of,
i. the day on which the consolidated prior solvency deficiency is liquidated, if the administrator elected Option 4 or both Options 4 and 5,
ii. the day on which the remaining period during which any new solvency deficiency determined under section 5.6 must be liquidated is equal to five years, and
iii. the day on which the remaining period during which the new solvency deficiency must be liquidated is equal to five years, if the administrator elected Option 5 or both Options 4 and 5.
10. Paragraph 8 does not apply with respect to an increase in a going concern unfunded liability that results from an amendment made to confer a benefit improvement that is required by law.
(7) The following apply for the purposes of the definition of “G” in the definition of “D” in subparagraph 7 iv of subsection (6):
1. For the purposes of paragraphs 2 and 3, an imputed going concern unfunded liability in respect of a solvency relief report for a plan for which a benefit allocation method is not used to set contribution rates for the plan is the amount by which “H” exceeds “J” where,
“H” is the present value, as of the valuation date of the plan’s solvency relief report, of the monthly contributions determined using the actuarial cost method adopted by the plan for a period beginning on the valuation date of the plan’s solvency relief report and ending at the end of a 15-year period that begins on a day not more than 12 months after the valuation date, and
“J” is the present value of the normal cost determined using a benefit allocation method over the period described in the definition of “H”.
2. The imputed going concern special payments in respect of a plan that is not a jointly sponsored pension plan are the monthly contributions, calculated using the going concern valuation interest rate or rates, that would be required to amortize the imputed going concern unfunded liability over a period beginning on the valuation date of the plan’s solvency relief report and ending at the end of a 15-year period that begins on a day not more than 12 months after the valuation date.
3. In the case of a plan that is a jointly sponsored pension plan,
i. the amount required to amortize the imputed going concern unfunded liability determined in the solvency relief report is determined as a level percentage of pensionable earnings, and
ii. the amount of the imputed going concern unfunded liability in the plan’s solvency relief report is determined under paragraph 1 as if the amounts of “H” and “J” were calculated based on the total projected pensionable earnings for the period that begins on the valuation date of the solvency relief report and ends at the end of a 15-year period that begins on a day not more than 12 months after the valuation date.
(8) The following pension plans are excluded plans for the purposes of this section:
1. A plan that does not provide defined benefits.
2. A plan that was not registered under the Act or under the legislation of a designated jurisdiction before September 30, 2011,
i. unless the plan is deemed under section 80 of the Act to be a continuation of another plan that was registered before that day,
ii. unless the plan is a successor plan described in section 81 of the Act and the original plan was registered before that day, or
iii. unless the plan was formed by the merger of two or more plans and at least one of the original plans was registered before that day.
3. A specified Ontario multi-employer pension plan within the meaning of section 6.0.1.
4. A participating Ontario pension plan within the meaning of section 3 of Ontario Regulation 196/11 (AbiBow Canada Inc. Pension Plans) made under the Act.
5. The Hourly Plan and the Salaried Plan within the meaning of subsection 2 (1) of Ontario Regulation 321/09 (General Motors Pension Plans) made under the Act.
6. A participating pension plan within the meaning of subsection 1 (1) of Ontario Regulation 99/06 (Stelco Inc. Pension Plans) made under the Act.
7. A public sector pension plan listed in Schedule 1 to Ontario Regulation 178/11 (Solvency Funding Relief for Certain Public Sector Pension Plans) made under the Act.
8. Any other public sector pension plan that satisfies the criteria set out in subsection 47.7 (1),
i. if the ratio of the plan’s solvency assets to its solvency liabilities is less than 0.9 as of the valuation date of the solvency relief report under this section, or
ii. if the ratio of the market value of the plan’s assets to its going concern liabilities is less than 0.9 as of the valuation date of the solvency relief report under this section.
9. A plan to which not all of the contributions set out in reports filed under section 3, 13 or 14 that were required to be made before the valuation date of the solvency relief report under this section have been made in accordance with the Act and the regulations.
(9) In this section, unless otherwise indicated, “consolidated prior solvency deficiency” and “new solvency deficiency” refer to those deficiencies as determined in a solvency relief report under this section.
7. Subsection 5.7 (1) of the Regulation is amended by adding “or Option 5 under section 5.6.1”after “Option 3 under section 5.6”.
8. The Regulation is amended by adding the following sections:
5.8 (1) This section applies if an administrator of a pension plan is required by section 5.7 to send an information statement and a notice of objection form to any person in connection with the election of Option 3 or Option 5.
(2) The administrator shall file a certificate of consent containing the following information, as applicable:
1. The total number of persons who were eligible members, eligible former members or eligible retired members on the valuation date of the plan’s solvency relief report and on the day the information statement under subsection 5.7 (2) was sent by the administrator.
2. The number of persons described in paragraph 1 who either submitted notices of objection to the election of Option 3 or Option 5, as the case may be, by the administrator or were represented by a collective bargaining agent that submitted a notice of objection on their behalf.
3. Confirmation that the number of objections to the election that were received by the administrator represents objections from not more than one-third of the total number of persons described in paragraph 1.
(3) The certificate of consent must be filed with the Superintendent not more than 60 days after the solvency relief report is filed.
5.9 (1) An administrator of a pension plan who makes an election under section 5.6 or 5.6.1 shall send a notice containing the following information to every person who is an eligible member, an eligible former member or an eligible retired member on the day the notice is sent and to every collective bargaining agent that represents eligible members on that day:
1. The name and provincial registration number of the plan.
2. The name of and the contact information for the administrator.
3. The valuation date of the applicable solvency relief report.
4. A description of the option or options elected.
5. The transfer ratio of the plan as of the valuation date.
6. The estimated annual contributions that would have been required to fund the normal cost of the plan and all special payments if no election had been made and the estimated annual contributions that are required after the election.
7. An explanation of how the security of the pension benefits and ancillary benefits for eligible members, eligible former members and eligible retired members might be affected as a result of the election.
8. If the administrator has elected Option 3 or Option 5 and the plan is not a jointly governed plan,
i. confirmation that the collective bargaining agent, if any, objected or chose not to object on behalf of eligible members represented by the collective bargaining agent on the valuation date of the applicable solvency relief report, and
ii. confirmation that any objections to the election received by the administrator represented objections to the election from not more than one-third of the eligible members, eligible former members and eligible retired members.
(2) The notice must be sent on or before the later of,
(a) the 60th day after the first day a special payment is required to be made in respect of the new solvency deficiency or the new going concern unfunded liability, as the case may be; and
(b) the 60th day after the applicable solvency relief report is required to be filed.
5.10 (1) If the administrator of a pension plan elects Option 3 or Option 5, the administrator shall send progress reports under this section to the persons and collective bargaining agents specified in subsection (3).
(2) If both Option 3 and Option 5 have been elected, a single progress report may be used for both options.
(3) A progress report must be sent not more than six months after the end of each fiscal year of the plan in which a report under section 3 or 14 is filed until the new solvency deficiency has been liquidated, and it must be sent to every person who is an eligible member, eligible former member or eligible retired member on the day the particular progress report is sent and to every collective bargaining agent that represents eligible members on that day.
(4) Each progress report must contain the following information:
1. The name and provincial registration number of the plan.
2. The name of and the contact information for the administrator.
3. The valuation date of the solvency relief report and of the most recently filed report under section 3 or 14.
4. A description of the option or options elected.
5. The transfer ratio of the plan as of the valuation date of the solvency relief report.
6. The transfer ratio of the plan as of the valuation date of the most recently filed report under section 3 or 14 in which the transfer ratio was determined.
7. The estimated annual contributions required to fund the normal cost of the plan and all special payments set out in the report referred to in paragraph 6.
8. An explanation of how the security of the pension benefits and ancillary benefits for eligible members, eligible former members and eligible retired members might be affected as a result of the election.
(5) A progress report may be included in the written statement that is required to be sent to members under section 27 of the Act for the same fiscal year.
9. Subsection 6.0.4 (4) of the Regulation is revoked and the following substituted:
(4) If a report filed under section 3, 13 or 14 with a valuation date before September 30, 2011 discloses that there is a going concern unfunded liability, the liability shall be liquidated, with interest at the going concern valuation interest rate, by equal monthly instalments over a period of 12 years beginning on the valuation date of the report.
(4.1) If a report filed under section 3, 13 or 14 with a valuation date on or after September 30, 2011 discloses that there is a going concern unfunded liability, the liability shall be liquidated, with interest at the going concern valuation interest rate, by equal monthly instalments over a period of 12 years that begins on a date not later than 12 months after the valuation date of the report.
10. (1) Subsection 7 (3) of the Regulation is revoked and the following substituted:
(3) In any 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), an actuarial gain may be applied to reduce contributions for normal costs required to be made by the employer, by a person or entity required to make contributions on behalf of the employer, by the members of the pension plan or by any of them.
(2) Subsection 7 (4) of the Regulation is revoked and the following substituted:
(4) In any 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.
11. Subsection 14 (11) of the Regulation is revoked and the following substituted:
(11) Despite subsection (10), the administrator may file the first report for which the valuation date is on or after September 30, 2011 and before May 31, 2012 by February 28, 2013.
Commencement
12. This Regulation comes into force on the day it is filed.