Ordinance on the Trustees' and Advisory Boards of Supplementary Pension Funds and Payment Funds

Ordinance on the Trustees' and Advisory Boards of Supplementary Pension Funds and Payment Funds (Title amended - State Gazette, No. 85 of 2021) Published - State Gazette, No. 19 of 01.03.2005; in force from 01.03.2005; amended and supplemented, No. 85 of 12.10.2021 Adopted by Council of Ministers Decree No. 29 of 18.02.2005

Chapter One
GENERAL PROVISIONS

Art. 1. (Amended - State Gazette, No. 85 of 2021) This Ordinance regulates:

1. (amended - State Gazette, No. 85 of 2021) the rights and obligations of the trustees' boards of:
   a) universal pension funds and payment funds; b) occupational pension funds.
2. the composition, rights, and obligations of the advisory boards of funds for additional voluntary pension insurance.

Art. 2. (Added - State Gazette, No. 85 of 2021) The trustees' and advisory boards, hereinafter referred to as "the boards," represent and protect the interests of the insured persons and pensioners in the supplementary pension funds and payment funds.

Art. 3. (Amended - State Gazette, No. 85 of 2021) (1) For each universal pension fund and for the payment funds created in connection with the insurance therein, one trustees' board shall be established.
(2) For each occupational pension fund, one trustees' board shall be established.
(3) For each fund for additional voluntary pension insurance, one advisory board shall be established.

Chapter Two
COMPOSITION, ESTABLISHMENT OF BOARDS, AND TERM OF OFFICE

Art. 4. (Amended - State Gazette, No. 85 of 2021) (1) (Amended - State Gazette, No. 85 of 2021) The composition of each trustees' board includes an equal number of representatives from nationally representative organizations of workers and employees and of employers, and one representative of the pension insurance company. (2) (Amended - State Gazette, No. 85 of 2021) Within one month from the registration of the corresponding fund for additional mandatory pension insurance in the court registry, or no later than two months before the expiration of the term of the trustees' board, the pension insurance company sends a written invitation to the central leadership of each nationally representative organization of workers and employees and of employers to appoint their representatives to the trustees' board. The representatives of the organizations of workers and employees and of employers are appointed by their leadership bodies at the national level no later than one month from receipt of the invitation. (3) (Amended - State Gazette, No. 85 of 2021) The representative of the pension insurance company in the trustees' board is appointed by a decision of the management body of the company within two months from the registration of the corresponding fund for additional mandatory pension insurance in the court registry, or no later than one month before the expiration of the term of the respective trustees' board. (4) The first meeting of the trustees' board is convened by the pension insurance company within three months from the registration of the corresponding fund for additional mandatory pension insurance in the court registry, or within a seven-day period after the expiration of the term of the previous board.

Art. 5. (1) The composition of the advisory board includes:

1. representatives of the insured persons and pensioners of the corresponding fund for additional voluntary pension insurance;
2. representatives of employers and of the bodies under Art. 230, para. 3, item 3 of the Social Security Code, which make insurance contributions to the corresponding fund for additional voluntary pension insurance, hereinafter referred to as "insurers";
3. one representative of the pension insurance company.
   (2) The number of members of the advisory board cannot be less than 5 and more than 11 persons, with the number of representatives of the insured persons and pensioners being equal to or exceeding the number of representatives of the insurers. (3) The representatives of the insured persons and pensioners in the advisory board are appointed by the pension insurance company on the principle of random selection, with the representatives of the insured persons being chosen among the first 20 persons with the highest number of personal contributions and the highest amount of accumulated funds from personal contributions to the individual account in the corresponding fund for additional voluntary pension insurance. (4) The selection under para. 3 is carried out within two months from the registration of the fund for additional voluntary pension insurance in the court registry, or no later than one month before the expiration of the term of the advisory board. (5) Within one month from the registration of the fund for additional voluntary pension insurance in the court registry, or no later than two months before the expiration of the term of the advisory board, the pension insurance company invites the insurers who make contributions for the largest number of insured persons in the fund to designate their representatives within a specified period. If representatives are not designated within the specified period, the pension insurance company invites the next insurers in order who make contributions for the largest number of insured persons in the fund. (6) The representative of the pension insurance company in the advisory board is appointed by a decision of the management body of the company within the period specified in para. 4. (7) The first meeting of the advisory board is convened by the pension insurance company within three months from the registration of the fund for additional voluntary pension insurance in the court registry, or within a seven-day period after the expiration of the term of the previous board.

Art. 6. (Amended - State Gazette, No. 85 of 2021) (1) The members of the boards must meet the following requirements:

1. be legally competent natural persons;
2. not have been convicted of intentional crimes of a general nature;
3. not be deprived of the right to hold a position of material responsibility;
4. not be members of management or supervisory bodies or employees of another pension insurance company;
5. (amended - State Gazette, No. 85 of 2021) not be members of a trustees' or advisory board of a fund managed by another pension insurance company.
   (2) (Amended - State Gazette, No. 85 of 2021) Within the period specified in Art. 4, para. 4 and Art. 5, para. 7, the members of the boards must submit to the pension insurance company managing the corresponding fund or funds a written declaration that they meet the requirements of para. 1 and that they undertake to notify the respective board of any changes in the declared circumstances. The declarations are kept by the company.

Art. 7. The term of office of the members of the boards is 5 years.

Art. 8. (1) The term of office of the members of the trustees' boards is terminated prematurely:

1. if they cease to meet any of the requirements under Art. 6, para. 1;
2. in case of permanent factual inability to perform their duties for more than 6 months;
3. in cases of disclosure of facts or information that they learned during or in connection with the exercise of the functions of the board and which are not publicly known;
4. by a decision of the leadership bodies of the nationally representative organizations of workers and employees and of employers, or by a decision of the management body of the pension insurance company - for the representative appointed by them.
   (2) Upon termination of the term of office of a member under para. 1, items 1-3, the chairman of the trustees' board notifies the body that appointed the released member of the board and invites them to designate a new representative within one month from receipt of the invitation. (3) Simultaneously with the decision to terminate the term of office of a member under para. 1, item 4, the respective body designates a new representative to the trustees' board. (4) The representative appointed in the corresponding manner to replace a prematurely released member of a trustees' board completes the remaining term of office.

Art. 9. (1) The term of office of the members of the advisory boards is terminated prematurely:

1. if they cease to meet any of the requirements under Art. 6, para. 1;
2. in case of permanent factual inability to perform their duties for more than 6 months;
3. in cases of disclosure of facts or information that they learned during or in connection with the exercise of the functions of the board and which are not publicly known;
4. upon their written request to the respective board - for the representatives of the insured persons and pensioners;
5. by a decision of the insurer or of the management body of the pension insurance company - for the representative appointed by them.
   (2) Upon termination of the term of office of a member under para. 1, items 1-4, the chairman of the advisory board notifies the insurer or the pension insurance company to designate a new representative within one month under the conditions and procedure specified in Art. 5, paras. 3, 5, and 6. (3) Simultaneously with the decision to release a member under para. 1, item 5, the insurer, respectively the pension insurance company, designates a new representative to the advisory board. (4) The representative appointed in the corresponding manner to replace a prematurely released member of an advisory board completes the remaining term of office.

Chapter Three
ORGANIZATION, ACTIVITIES, AND FUNCTIONS OF THE BOARDS

Art. 10. (1) Each trustees' and advisory board elects from among its members a chairman and a deputy chairman. The chairman and deputy chairman have a term of one year.
(2) The chairman:

1. represents the board;
2. convenes and chairs the meetings of the board;
3. organizes and controls the work of the board;
4. signs the minutes of the meetings of the board.
   (3) The functions of the deputy chairman are defined in the rules of procedure under Art. 12.

Art. 11. The boards are serviced by a technical secretary appointed by the respective pension insurance company, who:

1. manages the correspondence and keeps the documentation of the board;
2. performs the operational administrative work in the preparation and conduct of the board meetings;
3. drafts and signs the minutes of the meetings of the board;
4. notifies interested parties of the decisions taken by the board in connection with complaints, requests, and reports submitted to it.

Art. 12. Each trustees' and advisory board adopts rules of procedure for its activities within three months from the holding of its first meeting.

Art. 13. (1) The boards hold meetings at least once every three months in the manner determined in their rules of procedure.
(2) The meetings of the boards are valid if at least two-thirds of their members are present.
(3) Upon invitation by the boards, representatives of the Commission for Financial Supervision, the respective pension insurance company, experts regarding specific issues under discussion, as well as representatives of other bodies and organizations may attend the meetings.

Art. 14. (1) Each member of a trustees' or advisory board has one vote.
(2) The boards make decisions by a majority of more than half of their members.
(3) The decisions of the boards are of a recommendatory nature for the pension insurance companies.

Art. 15. (Amended - State Gazette, No. 85 of 2021) (1) Each trustees' and advisory board performs the following functions:

1. (amended - State Gazette, No. 85 of 2021) monitors compliance with the obligations of the pension insurance company towards the insured persons and pensioners in the respective funds;
2. (amended - State Gazette, No. 85 of 2021) reviews complaints, requests, and reports related to violations of the rights of insured persons and pensioners in the respective funds, sends inquiries and requests regarding them to the pension insurance company and/or other institutions and organizations, and assists in resolving arising disputes;
3. (amended - State Gazette, No. 85 of 2021) discusses the annual financial reports of the respective funds;
4. (amended - State Gazette, No. 85 of 2021) makes written proposals for improving the organization and activities of the pension insurance company in servicing the insured persons and pensioners in the respective funds;
5. (amended - State Gazette, No. 85 of 2021) makes written proposals on other aspects of the activities of the pension insurance company that affect the rights of the insured persons and pensioners in the respective funds;
6. (amended - State Gazette, No. 85 of 2021) prepares an annual report on its activities and submits it to the pension insurance company managing the corresponding fund or funds and to the Commission for Financial Supervision by April 30 of the following year, or for a board whose term expires, by the date on which its term expires.
   (2) (Amended - State Gazette, No. 85 of 2021) Each trustees' and advisory board sends its proposals, inquiries, and requests under para. 1 to the management body of the pension insurance company managing the corresponding fund or funds.
   (3) (Amended - State Gazette, No. 85 of 2021) The management body of the pension insurance company is obliged to discuss the proposals, inquiries, requests, and annual report under para. 1, item 6 at its first meeting after receiving them at the company, to make a decision on them, and to inform the chairman of the respective board in writing of its decision within seven days from the date of the meeting.

Art. 16. (Amended - State Gazette, No. 85 of 2021) (1) (Amended - State Gazette, No. 85 of 2021) Each trustees' and advisory board performs its functions at the seat of the pension insurance company managing the corresponding fund or funds and has a correspondence address - the address of the management of the company. (2) (Amended - State Gazette, No. 85 of 2021) The costs associated with the activities of each board are borne by the pension insurance company managing the corresponding fund or funds. (3) The members of the boards do not receive remuneration for their activities.

Chapter Four
RIGHTS AND OBLIGATIONS OF THE BOARDS

Art. 17. (Amended and supplemented - State Gazette, No. 85 of 2021) (1) (Previous text of Art. 17 - State Gazette, No. 85 of 2021) Each trustees' and advisory board has the right of access to the documentation of the respective pension insurance company related to the performance of the functions under Art. 15, para. 1, as well as:

1. to send its members to meetings of the management body of the pension insurance company when issues regarding which proposals, inquiries, and requests have been sent are discussed;
2. to send reasoned proposals in written form to the pension insurance company for amendments and supplements to the rules of procedure for the organization and activities of the corresponding fund for additional pension insurance;
3. (amended - State Gazette, No. 85 of 2021) to send reasoned proposals in written form to the pension insurance company for improving the activities in additional pension insurance;
4. to use free of charge the premises, technical equipment, and other material conditions of the pension insurance company necessary for the performance of the functions under Art. 15, para. 1;
5. to require assistance from the pension insurance company in the performance of its functions;
6. to inform the public in an appropriate manner about the results of its work, including on the website of the respective pension insurance company.
   (2) (New - State Gazette, No. 85 of 2021) In addition to the rights under para. 1, the trustees' board under Art. 3, para. 1 has the right to send reasoned proposals in written form to the pension insurance company for amendments and supplements to the rules of the payment funds.

Art. 18. Each trustees' and advisory board is obliged:

1. to investigate the received complaints, requests, and reports, to take the necessary actions in accordance with its functions, and to respond in writing to the respective persons within the period specified in Art. 174, para. 2 of the Social Security Code;
2. to immediately notify the deputy chairman of the Commission for Financial Supervision, heading the "Insurance Supervision" Directorate, in case of reasonable suspicion of violations of insurance legislation by the pension insurance company, its employees, or insurance intermediaries.

Chapter Five
AVOIDANCE OF CONFLICT OF INTEREST IN THE WORK OF THE BOARDS

Art. 19. (Amended - State Gazette, No. 85 of 2021) (1) The members of the boards cannot:

1. disclose facts and information that they learned during or in connection with the exercise of the functions under Art. 15, para. 1 and which are not publicly known;
2. use their position for personal gain to obtain benefits, special privileges, exemption from obligations, or avoidance of the consequences of their own or others' illegal actions;
3. (amended - State Gazette, No. 85 of 2021) perform personal services or represent or defend the interests of a natural or legal person in their activities or before the company, unless this is in the interest of the insured persons and pensioners in the respective funds or follows from the law and the provisions of this Ordinance.
   (2) The members of the boards sign a declaration that they are notified of their obligation not to disclose to third parties facts or information that they learned during or in connection with the performance of their functions and which are not publicly known. The declarations are submitted to the respective company within the period specified in Art. 4, para. 4 and Art. 5, para. 7 and are kept by it.

Chapter Six
ADMINISTRATIVE PENAL LIABILITY

Art. 20. (Amended - State Gazette, No. 85 of 2021) (1) (Amended - State Gazette, No. 85 of 2021) Whoever commits or permits the commission of a violation of this Ordinance shall be punished in accordance with Art. 351 of the Social Security Code. (2) Violations of the provisions of this Ordinance are established by acts drawn up by officials authorized by the deputy chairman of the Commission for Financial Supervision, heading the "Insurance Supervision" Directorate. (3) Penalty orders are issued by the deputy chairman of the Commission for Financial Supervision, heading the "Insurance Supervision" Directorate, or by an official authorized by him. (4) The establishment of violations, the issuance, appeal, and execution of penalty orders are carried out in accordance with the Law on Administrative Offenses and Penalties.

TRANSITIONAL AND FINAL PROVISIONS

§ 1. Pension insurance companies are obliged within six months from the entry into force of this Ordinance to bring into compliance with its provisions the composition and activities of the trustees' and advisory boards of the funds managed by them, to make the corresponding changes in the rules of procedure for the organization and activities of the funds, and to submit the necessary documents to the Commission for Financial Supervision.

§ 2. The activities of the trustees' and advisory boards of the supplementary pension funds elected before the entry into force of this Ordinance are terminated within the period specified in § 1 with the establishment of new boards in accordance with Art. 4 and 5.

§ 3. (Amended - State Gazette, No. 85 of 2021) This Ordinance is adopted on the basis of Art. 155, para. 4 and Art. 242, para. 2 of the Social Security Code and enters into force from 1 March 2005.

§ 4. The Commission for Financial Supervision issues guidelines on the application of this Ordinance.

Transitional and Final Provisions to DECREE No. 324 of the Council of Ministers of 07.10.2021 for amendment and supplementation of the Ordinance on the Trustees' Boards of Funds for Additional Mandatory Pension Insurance and on the Advisory Boards of Funds for Additional Voluntary Pension Insurance (State Gazette, No. 85 of 12.10.2021)

§ 13. The trustees' boards of universal pension funds elected before the entry into force of this Ordinance perform the functions of trustees' boards of universal pension funds and payment funds from 1 September 2021 until the expiration of their terms of office.

§ 14. The trustees' boards of universal pension funds and payment funds bring their rules of procedure into compliance with the requirements of this Ordinance within the period until 30 November 2021.