Attention: FSRA issues final guidance on pension plan changes | Blake, Cassels & Graydon LLP

The Financial Services Regulatory Authority of Ontario (FSRA) has published its final guidance on pension plan amendments, effective June 4, 2024 (Amendment Guidance). The Amendment Guidelines describe the FSRA’s approach to:

• Pension plan changes that are considered “retroactive adverse changes” (as that term is defined in the amendment guidelines) and are generally not permitted
• The limited circumstances under which the FSRA may, in its discretion, register retroactive adverse changes and the type of filing a plan administrator should make to the FSRA in support of such changes
• Retroactive changes to correct an editorial error in the plan text
• Amendments to replace a variable indexation formula with a fixed indexation rate for acquired entitlements
• Notification obligations in the event of future adverse changes
• Power of the FSRA to issue a notice of intended refusal to register a plan amendment
• Potential monetary penalties for an administrator who fails to comply with applicable plan amendment requirements under the Pension Insurance Act (Ontario)
• Summary of the FSRA’s statutory interpretation regarding retrospective adverse changes

These notes are particularly important for plan administrators considering a plan amendment that has an effective date prior to the date the amendment is filed with the FSRA.