NOTE
According to the Directive 2003/41/EC the social and labour law of the host Member State relevant to the field of occupational pension scheme is applicable to the relationship between the sponsoring undertaking and members of the pension plan.
The summary of information below is an extract from the law "On Private Pension Funds" and should not be used as legally binding document. This information is not comprehensive and does not create any obligations. For exhaustive information please refer to the set of relevant legal documents and contact relevant competent authority.
Financial and Capital Market Commission is not a competent authority as regards supervision of the compliance with requirements of social and labour law.
Financial and Capital Market Commission shall supervise whether a pension fund of another member state that accepts contributions from a sponsoring employer registered in Latvia complies with requirements for information to be given to the members of a pension fund.
The complete version of the law "On Private Pension Funds" could be found at:
Requirements of social and labour law relevant to the area of occupational pensions under which a pension scheme sponsored by an undertaking in Latvia must be operated by a cross-border operating host IORP. (Extract from the law "On Private Pension Funds")
According to the law "On Private Pension Funds" members of a pension scheme shall have membership in a pension scheme through the intermediation of their employer, where the employer has concluded a collective membership contract with an open or a closed pension fund; moreover, a collective membership contract with a closed pension fund may be concluded only in those cases where the relevant employer is also one of the founders (shareholders) of that closed pension fund.
Where an employer has concluded a collective membership contract with an open or a closed pension fund, the employer and employees who have membership in a pension scheme shall jointly set up the pension scheme committee, whereon the employer and employees are equally represented. Where less than one hundred employees of an employer have membership in a pension scheme, setting up the pension scheme committee shall not be mandatory.
The pension scheme committee is the controlling institution of a pension scheme that controls the management of the respective pension scheme and compliance with the provisions of the collective membership contract.
Where an employer takes a decision to pay contributions to a pension scheme to ensure the supplementary retirement benefit for its employees that decision shall apply to all employees of that employer in accordance with their profession, length of service and position, as well as other objective criteria. Issues relating to the membership of those persons to whom one and the same objective criteria apply shall be treated similarly, and no discrimination on the grounds of origin, property status, race and nationality, sex or religion shall be permitted.
The legal relationship between an employer and its employees that arises as a result of the implementation of a pension scheme and the participation of employees therein shall be governed by an employment contract or a collective employment contract. Terms and conditions of the employment contract or the collective employment contract are regulated by Labour Law.
Where an employer commits to guarantee a definite amount of benefits for beneficiaries, the pension scheme and the collective membership contract shall contain a provision that the obligation of an employer is to pay contributions on behalf of its employees in the amount that will ensure the amount of those benefits.
A pension scheme whose liabilities have been assumed by a sponsoring employer shall have only one membership contract that has been concluded with the sponsoring employer who has guaranteed the fulfilment of those liabilities.
The retirement age specified in a pension scheme shall not be less than 55 years, with the exception of special pension schemes for certain professions, the list of which is approved by the Cabinet of Ministers.
A member of a pension scheme shall be entitled to all supplementary pension capital accrued on his/her individual account without any additional conditions, except the case envisaged by Paragraph 1 of Article 13 hereof when the employer is entitled to transfer the supplementary pension capital to another pension fund upon termination of the collective membership contract.
An employer shall be entitled to transfer assets accrued for the account of employees only upon written consent by the relevant employees.
The supplementary pension capital accrued on an individual account shall never become the property of an asset manager, a custodian or an employer. The supplementary pension capital shall be subject to collection only where a court judgment recognizes that a member of a pension scheme has caused detriment to third parties by committing a criminally liable offence.
Where a sponsoring employer has been recognised as insolvent and its bankruptcy proceedings are initiated, the employee's pension scheme and the respective collective membership contract shall be terminated unless the new sponsoring employer takes over all rights and liabilities of the former employer. Members of a pension scheme may continue their membership in the pension scheme with the new sponsoring employer.
Where a sponsoring employer has been recognised as insolvent and its bankruptcy proceedings are initiated, a member shall be entitled to terminate its membership in a pension scheme and request that its accrued assets are transferred to another pension scheme. In this case the value of the transferable or payable supplementary pension capital shall be calculated in accordance with the provisions of Paragraph 3 of Article 22 hereof.
Click on the following links for Labour Law:
http://www.lm.gov.lv/?sadala=253
http://www.lm.gov.lv/?sadala=290
http://www.lm.gov.lv/?sadala=554