Management of State funded pension scheme assets
Management of contributions made to the funded pension scheme, further fruits (interest) and other assets may be performed by a manager of the funded pension scheme. Assets of the funded pension scheme may be managed by an investment management company registered in the Republic of Latvia or a branch of an investment management company registered in the European Union or European Economic Area which is opened in Latvia and is authorized to provide investment management services. The manager of funded pension scheme assets may commence managing the funded pension scheme assets only after the registration of the manager of funded pension scheme assets with the register which has been maintained and updated by the Financial and Capital Market Commission. The procedure for registration of the managers of funded pension scheme assets is set out in Section 11.3 of the Law on State Funded Pensions.
The investment management company which performs management of State funded pension scheme assets shall comply with the Law on State Funded Pensions, Cabinet Regulation No. 272 of 27 May 2003, Regulations regarding the Operation of State Funded Pension Schemes, as well as Regulations issued by the Financial and Capital Market Commission.
The Commission shall process an application and take a decision regarding making an entry in the register of managers of the funded pension scheme assets or refusal to make a relevant entry within a 60-day period after submission of all the documents mentioned in Section 11.3 (1) and (2) of the Law on State Funded Pensions which are prepared and completed in compliance with the relevant requirements.
The Law on State Funded Pensions, Cabinet Regulation No. 272 of 27 May 2003, Regulations regarding the Operation of State Funded Pension Schemes and other rules regulating management of State funded pension scheme assets are available (in Latvian) at:
The State funded pension scheme (2nd pension pillar) (SFPS) is a State organized set of measures for making contributions, administration of funds contributed and disbursement of pensions, which without increasing the total amount of contributions for old age pensions provides an opportunity to acquire additional pension capital by investing part of the contributions for old age pensions in financial instruments and other assets in accordance with the procedures laid down in the Law on State Funded Pensions. Contributions in the SFPS form a part of the contributions actually made for State pension insurance.
The State Social Insurance Agency is responsible for administering the SFPS and conclusion of contracts with the SFPS asset managers. The State Social Insurance Agency ensures the establishment and updating of accounts of participants in the SFPS by registering contributions made and the funded pension capital accrued as well as the transfer of the contributions of the SPFS participants to the SFPS asset managers, requesting the funded pension capital accrued from the SFPS asset managers, when the SFPS participants change an investment plan or terminate participation in the SFPS, and the transfer of the funded pension capital to asset managers in the case of change of investment plans, etc.
Further details on functions of the State Social Insurance Agency please find here: https://www.vsaa.gov.lv/en/services/for-employees/2-nd-tier-mandatory-state-funded-pension-scheme/