Pension Assets Transfer Regulation

Pension Assets Transfer Regulation, M.R. 4/97 The Manitoba Telephone System Reorganization and Consequential Amendments Act , S.M. 1996, c. 79 Regulation 4/97 Registered January 7, 1997 bilingual version (HTML) Definitions 1 In this regulation, "Act" means The Manitoba Telephone System Reorganization and Consequential Amendments Act ; (« Loi ») "adjusted preliminary transfer fraction" means the preliminary transfer fraction multiplied by the fraction, the numerator of which is the total fair market value of the liquid assets immediately before the transfer date, excluding the portion thereof that can reasonably be attributed to contributions to the fund made in 1997, and the denominator of which is the total fair market value at that time of the liquid assets; (« fraction transférée préliminaire rajustée ») "board" means The Civil Service Superannuation Board appointed under The Civil Service Superannuation Act ; (« Régie ») "liquid assets" means the following assets of the fund: (a) cash, (b) bonds, and (c) publicly traded assets; (« actif liquide ») "new plan assets" at any time means those assets, or portions thereof, of the fund that have been allocated pursuant to section 7 for transfer to the trust fund and have not before that time been transferred to the trust fund; (« actif du nouveau régime ») "non-liquid assets" means the assets of the fund that are not liquid assets; (« actif non liquide ») "preliminary report" means the report entitled "Actuarial Report on the Civil Service Superannuation Fund as at December 31, 1995" bearing date September 25, 1996; (« rapport préliminaire ») "preliminary transfer fraction" means the fraction, the numerator of which is the amount of the actuarial liabilities of the fund for benefits payable or accrued to the persons described in clause 15(2)⁠(a) of the Act based upon the preliminary report, and the denominator of which is the amount of the actuarial liabilities of the fund for benefits payable or accrued to all persons entitled to benefits from the fund based upon the preliminary report, which fraction, expressed as a percentage and rounded to the nearest one-half of one percentage point, is 21.5%; (« fraction transférée préliminaire ») "report" means the actuarial report in respect of the fund as at December 31, 1996; (« rapport ») "subsequent event" means, as at a specified date, an event occurring after the effective date of an actuarial valuation and up to the specified date which indicates a need to adjust the valuation results, and includes only events that have actually transpired on or before the specified date, or which, at the specified date, are fully committed to occur in the future, all in accordance with the Standards of Practice for Valuation of Pension Plans of the Canadian Institute of Actuaries effective May 1, 1994; (« événement ultérieur ») "total assets" means the total fair market value of all the assets of the fund as at the beginning of the implementation date; (« actif total ») "transfer date" means the date on which the transfer is made under subsection 8(1); (« date de transfert ») "transfer fraction" means the fraction, the numerator of which is the amount of the actuarial liabilities of the fund for benefits payable or accrued to the persons described in clause 15(2)⁠(a) of the Act based upon the report, and the denominator of which is the amount of the actuarial liabilities of the fund for benefits payable or accrued to all persons entitled to benefits from the fund based upon the report, which fraction shall be expressed as a percentage and rounded to the nearest .0001 of a percentage point (« fraction transférée ») . Implementation date 2 The implementation date shall be January 1, 1997. Preliminary transfer amount 3 The preliminary transfer amount is the total of (a) the amount determined by multiplying the total fair market value of the liquid assets immediately before the transfer date by the adjusted preliminary transfer fraction; and (b) the amount determined by multiplying the total fair market value of the non-liquid assets as at the beginning of the implementation date by the preliminary transfer fraction. Final transfer amount 4 The final transfer amount is the amount determined by multiplying the total assets by the transfer fraction. Asset values 5(1) The board shall provide to the corporation before February 1, 1997 (a) a list of all the assets of the fund and their respective fair market values as at the end of the day on December 31, 1996 as determined by the board; and (b) all information reasonably required for the corporation to audit the list referred to in clause (a), which information may include in respect of each of the non-liquid assets, but shall not be limited to (i) a comprehensive description of the asset, (ii) a copy of any prospectus, registration statement or offering memorandum relating to the asset, (iii) copies of any reports filed with securities regulatory authorities in connection with the acquisition of the asset by the fund, (iv) the valuation methodology that was used in determining the value of the asset, including any pricing formulas and procedures used to establish the market value of the asset, (v) the names of any external valuators or appraisers who participated in the valuation or appraisal of the asset, and (vi) the percentage of the asset owned by the fund. 5(2) If the corporation believes the value assigned to an asset of the fund is materially inaccurate, (a) the corporation shall so advise the board, in writing, before April 2, 1997; (b) each of the corporation and the fund shall engage, at its own expense, an independent valuator or appraiser to value the asset, which valuator or appraiser must be approved by the party not engaging it; and (c) the value of the asset shall conclusively be considered to be the average obtained by dividing in half the sum of the values assigned to the asset by the two independent valuators or appraisers. Actuarial liabilities of fund 6(1) For the purposes of determining the preliminary transfer fraction and the transfer fraction, the actuarial liabilities of the fund shall be calculated using the actuarial assumptions and methods identified in the preliminary report. 6(2) The board shall provide to the corporation before April 2, 1997 all data upon which the report is being and will be based. 6(3) The board shall provide to the corporation before May 1, 1997 a copy of the report. 6(4) If the corporation believes the amount of the actuarial liabilities of the fund (a) for benefits payable or accrued to the persons described in clause 15(2)⁠(a) of the Act; or (b) for benefits payable or accrued to all persons entitled to benefits from the fund; in the report to be materially inaccurate, the corporation shall provide written notice to the board before May 15, 1997, and if the corporation and the board are unable within 10 days after the giving of the notice to agree on the amount or amounts in dispute, such amount or amounts shall be determined conclusively by an independent actuary appointed jointly by the corporation and the board or, if they are unable to agree on an actuary, by an independent actuary appointed by the provincial auditor. 6(5) The cost of obtaining the determination by an independent actuary under subsection (4) shall be borne equally by the corporation and the fund. Allocation of assets for transfer 7(1) On or before the transfer date, the board shall allocate for transfer to the trust fund (a) the adjusted preliminary transfer fraction of each liquid asset immediately before the transfer date, or such other fraction of each liquid asset as the board and the corporation agree upon and which will result in an allocation for transfer of liquid assets having a total fair market value immediately before the transfer date equal to the adjusted preliminary transfer fraction of the total fair market value of all the liquid assets of the fund at that time; and (b) the preliminary transfer fraction, or such other fraction as may be agreed upon by the board and the corporation, of each non-liquid asset which the board and the corporation have agreed to allocate for transfer. 7(2) If the amount transferred on the transfer date is less than the preliminary transfer amount, the shortfall shall be satisfied with assets of the fund allocated for transfer in accordance with the following rules: (a) within 7 days after the transfer date, the board shall provide to the corporation a list of those non-liquid assets as at the implementation date (other than those already transferred on the transfer date) which, or portions of which, it proposes to allocate for transfer; (b) within 15 days after receiving the list referred to in clause (a), the corporation shall by written notice to the board identify (i) those non-liquid assets on the list the ownership of which by the trust fund would be inconsistent with the normal asset mix policy set out in the Statement of Investment Policies and Goals of the new plan, and (ii) those non-liquid assets on the list in which the trust fund desires to have either a lesser interest or a greater interest or in lieu of which the trust fund desires to have allocated for transfer other assets or a greater interest in other assets, which notice shall be accompanied by confirmation of any inconsistency referred to in subclause (i) from the actuary of the new plan; (c) if within 15 days after notice is given under clause (b) the corporation and the board are unable to agree on the allocation for transfer of any non-liquid asset or any portion thereof, the remaining non-liquid assets of the fund (other than those which the corporation and the board have previously agreed to allocate for transfer or not to have allocated for transfer) shall be allocated for transfer as follows: (i) in the manner determined by the minister, if the corporation or the board by written notice to the minister and the other party within five days after the expiry of the 15-day period requests the minister to determine the manner in which they shall be allocated for transfer, and (ii) in any other case, by allocating for transfer such fraction of each of those remaining non-liquid assets as is necessary for the fund to satisfy the shortfall. 7(3) If a new plan asset is disposed of by the fund otherwise than on a transfer to the trust fund, only liquid assets shall be allocated for transfer in its place. 7(4) The board or the corporation may, by written notice before March 1, 1997 to the other and to the minister, refer to the minister any dispute regarding the allocation of assets under this section and the board and the corporation may present written submissions relating to the matter in dispute. 7(5) The minister shall consider the written submissions, if any, made under subsection (4) within 14 days after the notice is received by the minister and shall as soon as is practicable determine the matter in dispute and notify the board and the corporation of that determination. Transfer date and adjustment 8(1) On or before April 1, 1997, the board shall transfer or cause to be transferred to the trust fund, on account of the final transfer amount and the trust fund's entitlement under subsection (3), the preliminary transfer amount. 8(2) The assets comprising the preliminary transfer amount shall be the new plan assets of the fund on the transfer date. 8(3) In addition to the final transfer amount, the trust fund shall be entitled to the amount determined by multiplying by the transfer fraction the amount by which (a) the total fair market value of the assets of the fund immediately before the transfer on the transfer date, other than the portion thereof that can reasonably be attributed to contributions to the fund made in 1997; exceeds (b) the total assets. 8(4) Before June 6, 1997, the board shall pay or transfer or cause to be paid or transferred to the trust fund (a) any new plan assets then remaining in the fund; and (b) the amount, if any, by which (i) the total of the final transfer amount, as finally adjusted taking into account all adjustments made under subsections 5(2) and 6(4), and the amount of the trust fund's entitlement under subsection (3), exceeds (ii) the total of the amounts received by the trust fund under clause (a) and subsection (1). 8(5) Before June 6, 1997 and after the transfer made under clause (4)⁠(a), the corporation shall cause the trust fund to pay to the fund the amount, if any, by which the amount determined under subclause (4)⁠(b)⁠(ii) exceeds the amount determined under subclause (4)⁠(b)⁠(i). 8(6) The party required to pay or cause to be paid an amount under subsection (4) or (5) shall pay or cause to be paid to the party entitled to the amount an additional amount equivalent to interest on the amount calculated from the implementation date to the date of payment at an annual rate of interest equal to the annual rate of interest then paid by the government of Canada on 91-day treasury bills. 8(7) The corporation and the board shall take all steps as and when required to ensure that the transfers and payments required by this section to be effected or made are effected or made in accordance with this section. Employer contribution 9(1) The corporation shall contribute, on or before February 27, 1997, to the trust fund an amount equal to the lesser of (a) the value, as at the date of the contribution, of the corporation's investments held for pension obligations; and (b) the maximum contribution that would, if made by the corporation, be deductible by it in computing its income under the Income Tax Act (Canada). 9(2) In determining the amount of the employer contribution for the purposes of subsection (1), the actuarial report proposed for the corporation in respect of the new plan shall contemplate and disclose as a subsequent event the assumption by the trust fund of all liabilities of the fund to the persons described in clause 15(2)⁠(a) of the Act.