ISLAMABAD: Securities and Exchange Commission of Pakistan (SECP) has issued draft amendments in the Voluntary Pension Systems Rules, 2005 and proposed that in case of death of a participant before the retirement age, all the units of the sub-funds to his credit shall be redeemed at the net asset value notified at close of the day of intimation of death and the amount due shall be transferred to his individual pension account in the lower volatility scheme offered by the Pension Fund Manager.
The major amendments proposed are included:
Substitution of Rule 2 (ja) stating that “exposure” includes facility and finance, subscription to or investment in equity securities, debt instruments or securities, units or certificates or shares of a collective investment scheme Notified Entity, money market placements, and deposits, with financial institutions, certificate of deposits, CFS, forward contracts, derivatives and credit cards, margin trading system or any mechanism that replaces it, but does not include:
(i) obligations under letters of credit and letters of guarantee to the extent of cash margin held by an NBFC;
(ii) a facility finance provided to financial institutions through REPO transactions with underlying statutory liquidity requirement eligible securities;
(iii) deposits of less than ninety days in current and savings accounts other than term deposits;”;
In clause (m) following new sub-clause shall be inserted, namely:-
“(xii) a commodity contract that is traded at the Pakistan Mercantile Exchange (PMEX) shall be valued at its last closing price on PMEX on the date as of which it is valued, or if PMEX is not open on such date, then at its last closing price on the next preceding date on which PMEX was open.”
In rule 7,- in clause (e), for the semi colon (;) at the end a full colon “:” shall be substituted and thereafter the following new proviso shall be inserted, namely:
“Provided that the Pension Fund Manager may transmit or make available on its website the annual report of the pension fund for participants, provided it shall make the printed copy available to a participant free of cost as and when required;”
For clause (k), the following shall be substituted, namely: “(k) send an account statement as at the 30th June and the 31st December each year, within thirty days after the end of each date, to individual participants, giving detail of the amounts received or withdrawn and tax deducted and the number of units allocated and held, the current valuation of the units and such other information as may be specified by the Commission, free of charge. The Pension Fund Manager shall also send an account statement each time when there is an activity in the participant’s account within seven working days of such activity and the participant shall be entitled to receive any information, in respect of his account, at any time, on written application. Such information may also be posted on the website and furnished electronically, subject to prior approval of the Commission.”
In clause (I), for the full stop at the end, a semi colon and the word “; and” shall be substituted; and thereafter the following new clause shall be added, namely: –
“(m) send a notice to a participant at least thirty days before the chosen date of retirement informing him the options available to him on retirement, as per format prescribed by the Commission from time to time”.
In rule 15,- in sub-rule (1), for the word “at the close of the working day corresponding to the date of transfer” the word “on the working day prior to the date of transfer” shall be substituted; and in sub-rule (4), for the words “least twenty-one days before the effective date of the proposed change” at the end, the words “at least seven dealing days before the effective date of the proposed change and the Pension Fund Managers shall record such transactions as transfer in the statement of account of the participant” shall be substituted;
In rule 17, in sub-rule (1), the words “A notice shall be sent to the Pension Fund Manager at least thirty days before the chosen date of retirement.” shall be omitted; In rule 18,- for sub-rule (1), the following shall be substituted, namely:
“ At the date of retirement of the participant, where no option is selected by him, all the units of the sub- funds to his credit shall be redeemed at the net asset value notified at close of the day of retirement and the amount due shall be transferred to his individual pension account, in the lower volatility scheme offered by the Pension Fund Manager.”; and in sub-rule (1), in clause (d), for the word “twenty-one” the words “seven dealing” shall be substituted; and
In rule 20, for sub-rule (1), the following shall be substituted, namely:-
“(1) In case of death of a participant before the retirement age, all the units of the sub-funds to his credit shall be redeemed at the net asset value notified at close of the day of intimation of death and the amount due shall be transferred to his individual pension account in the lower volatility scheme offered by the Pension Fund Manager”;
