Global menu

Our global pages

Close

The Financial Services and Pensions Ombudsman Act 2017

  • Ireland
  • General

16-01-2018

The Financial Services and Pensions Ombudsman Act 2017 (the “FSPO Act”) came into force on 1 January 2018.

Pursuant to the FSPO Act, both the office of the Pensions Ombudsman and the Financial Services Ombudsman Bureau have been dissolved and replaced by the Office of the Financial Services and Pensions Ombudsman.

Headline Changes

New Ombudsman

Part XI of the Pensions Act 1990 (the “1990 Act”) has been abolished. The role of the Pensions Ombudsman is merged with the Financial Services Ombudsman. The merger establishes the Financial Services and Pensions Ombudsman (the “Ombudsman”) as an independent officer to resolve complaints about the conduct of pension providers through mediation and where necessary by investigation and adjudication. The Ombudsman has statutory powers to resolve disputes between parties and where necessary to direct rectification.

Class of Complainants

The 1990 Act provided that a complaint could be made by “an actual or potential beneficiary” of an occupational scheme who believed they had suffered financial loss because of maladministration of a scheme, trust RAC or PRSA.

Under the 1990 Act an "actual or potential beneficiary" was defined as meaning a member, an external member, any person who has been a member, any surviving dependant of a deceased member, any person claiming to be a member or a surviving dependant of a deceased member, a contributor to a PRSA, a personal representative of a deceased member or deceased contributor or a widow or widower of a deceased member or deceased contributor.

The FSPO Act states that the class of persons who may make a complaint to the Ombudsman is as follows:

  1. a consumer,
  2. an actual or potential beneficiary,
  3. a person acting on behalf of an actual or potential beneficiary, or
  4. a person of a class specified in regulations made by the Minister.

A “consumer” in relation to a pension product, means an actual or potential beneficiary of an occupational pension scheme, a trust RAC or a PRSA who believes they have suffered financial loss because of maladministration of the scheme, trust RAC or PRSA, as the case may be.

Under the FSPO Act an “actual or potential beneficiary” means a member, an external member, any person who has been a member, any surviving dependant of a deceased member, any person claiming to be a member or a surviving dependant of a deceased member, a contributor to a PRSA, a legal personal representative of a deceased member or deceased contributor, a widow, widower or surviving spouse or civil partner of a deceased member or deceased contributor or any person with an entitlement under a scheme.

The reference to “surviving spouse or civil partner of a deceased member or deceased contributor or any person with an entitlement under a scheme” was not included in the definition of an “actual or potential beneficiary” under the 1990 Act.

Against whom can a complaint be brought?

Section 126(3) and (4) the 1990 Act provided that a complaint could be made against a person who was responsible for the management of a scheme or PRSA, being any trustee or former trustee, any PRSA provider or former provider, any trust RAC employer or former employer to whom the trust RAC related who was required under section 58 to remit contributions to the trust RAC, or such other category as may be prescribed.

Under the FSPO Act the persons against whom a complaint can be made have been materially widened. A complaint can be made against a pension provider, which is
defined as:

  1. Any employer who adheres to the scheme; 
  2. Any person or undertaking that provides services to the scheme as a trustee, administrator, registered administrator, consultant or advisor, investment manager, custodian, paying agent, insurer or actuary;
  3. Any person to whom the implementation or interpretation of the rules of the scheme is entrusted;
  4. Any other person of a class specified in regulations made by the Minister.

Scheme” is defined as an occupational pension scheme, a PRSA or a trust RAC.

Form of complaint

The 1990 Act provided that a complaint was to be made in writing. The FSPO Act also requires a complaint to be made in writing. However, section 44(6) states that where the Ombudsman considers it appropriate, he or she may accept a complaint that is not in writing and, where it is so accepted, the Ombudsman shall reduce the complaint to writing as soon as practicable.

Internal Dispute Resolution Procedure

As with the 1990 Act, the FSPO Act requires the complainant to engage with the pension provider and attempt to resolve the complaint in the first instance by way of internal dispute resolution (“IDR”) procedures.

Section 55 of the FSPO Act provides that the Minister may, by regulation, require pension providers to establish procedures for dealing with complaints, including specified steps of IDR. However, IDR is not defined in the FSPO Act. Under the former legislation, the Pensions Ombudsman Regulations 2003 - SI 397/2003 (the “2003 Regulations”), the trustees of every pension scheme, trust RAC and PRSA provider were required to establish IDR procedures for dealing with complaints. The FSPO Act has revoked the 2003 Regulations.

We anticipate that the Minister will shortly enact regulations similar to the 2003 Regulations which will set out the IDR procedures to be followed by every pension provider. The new regulations will extend the requirement to establish IDR procedures to a wider class of complainants and also the class of persons in respect of whom a claim can be made.

Mediation

Section 58 of the FSPO Act now provides statutory footing for the Ombudsman to seek to resolve a complaint by way of mediation. Mediation was not featured in the 1990 Act.

Jurisdiction of the Ombudsman

The FSPO Act sets out the circumstances in which the Ombudsman cannot investigate a complaint:

  1. Where the internal dispute resolution procedures required have not been complied with,
  2. there are or have been proceedings before any court in respect of the matter that is the subject of the investigation, 
  3. the complaint relates to a matter that is within the jurisdiction of the Workplace Relations Commission or Pensions Authority or an alternative suitable forum or tribunal, or
  4. the complaint, or any matter arising in connection with the complaint, is excluded from the jurisdiction of the Ombudsman by regulations.

However, there is a qualification contained in the FSPO Act in relation to (b) above. The Ombudsman can accept a complaint against a pension provider who has instituted legal proceedings, where the Ombudsman believes that such proceedings were commenced to prevent the making of the complaint or to frustrate or delay its investigation. There was no provision to accept such a complaint under the 1990 Act.

Section 51(2)(b) of the FSPO Act provides that complaints relating to the conduct of a pension provider can be made up to the latest to occur of:

  • 6 years from the date of the conduct concerned; or
  • 3 years from the earlier of the date on which the person making the complaint first became aware, or ought reasonably to have become aware, of the conduct concerned; or
  • such longer period as the Ombudsman may allow where it appears that there are reasonable grounds for such a longer period and in granting the longer period it must be just and equitable, in all the circumstances.

These time limits are consistent with the 1990 Act.

However, under section 54(2) of the FSPO Act, the time limit specified in section 51 is suspended for the period during which a complaint is being considered under the appropriate IDR procedure. This did not feature in the 1990 Act.

Compensation

The 1990 Act provided for financial redress which would be of an amount the Pensions Ombudsman deemed to be just and equitable, but was not to exceed any actual loss of benefit under the scheme in question. This provision is unchanged in the FSPO Act.

The 1990 Act also provided for the payment of travelling expenses and incidentals to any other person who was required to attend before the Ombudsman as part of the investigation. These expenses are no longer provided for under the FSPO Act.

Appeals

The 1990 Act provided that an appeal could be brought to the High Court within 21 days of the Pensions Ombudsman’s final determination. Under section 64 of the FSPO Act, the appeal period has been extended to 35 days after the date of notification of the decision of the Ombudsman.

The FSPO Act extends the powers of the High Court on appeal from a decision of the Ombudsman, allowing it to make an order amending a decision of the Ombudsman or to make such other order as it considers just in all the circumstances.

Disclaimer

This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full terms and conditions on our website.

< Go back

Print Friendly and PDF
Register to receive regular updates via email.