Bill C-228
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- ENGLISH
- SUMMARY SUMMARY
- 1 Short Title 1 Short Title
- 2 Bankruptcy and Insolvency Act 2 Bankruptcy and Insolvency Act
- 5 Companies’ Creditors Arrangement Act 5 Companies’ Creditors Arrangement Act
- 6 Pension Benefits Standards Act, 1985 6 Pension Benefits Standards Act, 1985
- 9 Transitional Provisions 9 Transitional Provisions
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First Session, Forty-fourth Parliament,
70 Elizabeth II, 2021-2022
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HOUSE OF COMMONS OF CANADA
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BILL C-228
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An Act to amend the Bankruptcy and Insolvency Act, the Companies’ Creditors Arrangement Act and the Pension Benefits Standards Act, 1985
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FIRST READING, February 3, 2022
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Ms. Gladu
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441077
SUMMARY
This enactment amends the Bankruptcy and Insolvency Act and the Companies’ Creditors Arrangement Act to ensure that claims in respect of unfunded liabilities or solvency deficiencies of pension plans and claims relating to the cessation of an employer’s participation in group insurance plans are paid in priority in the event of bankruptcy proceedings.
It also amends the Pension Benefits Standards Act, 1985 to provide that an employer may provide financial security in the form of insurance for any portion of the contributions that they are required to pay under subsections 9(1.1) and (1.2) of the Act, and to authorize the administrator of an underfunded pension plan, in certain situations, to transfer or permit the transfer of any part of the assets or liabilities of the pension plan to another pension plan. The amendments also provide for the tabling of an annual report respecting the solvency of pension plans.
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Available on the House of Commons website at the following address:
www.ourcommons.ca
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1st Session, 44th Parliament,
70 Elizabeth II, 2021-2022
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HOUSE OF COMMONS OF CANADA
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BILL C-228
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An Act to amend the Bankruptcy and Insolvency Act, the Companies’ Creditors Arrangement Act and the Pension Benefits Standards Act, 1985
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Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:
Short Title
Short title
1 This Act may be cited as the Pension Protection Act.
R.S., c. B-3; 1992, c. 27, s. 2
Bankruptcy and Insolvency Act
2 (1) Subparagraph 60(1.5)(a)(ii) of the Bankruptcy and Insolvency Act is amended by adding the following after clause (A):
Start of inserted block
(A.1) an amount equal to the sum of all special payments, determined in accordance with section 9 of the Pension Benefits Standards Regulations, 1985, that were required to be paid by the employer to the fund referred to in sections 81.5 and 81.6 to liquidate an unfunded liability or a solvency deficiency,
(A.2) any amount required to liquidate any other unfunded liability or solvency deficiency of the fund as determined at the time of the filing of the notice of intention or of the proposal, if no notice of intention was filed,
End of inserted block (2) Subparagraph 60(1.5)(a)(iii) of the Act is amended by adding the following after clause (A):
Start of inserted block
(A.1) an amount equal to the sum of all special payments, determined in accordance with section 9 of the Pension Benefits Standards Regulations, 1985, that would have been required to be paid by the employer to the fund referred to in sections 81.5 and 81.6 to liquidate an unfunded liability or a solvency deficiency if the prescribed plan were regulated by an Act of Parliament,
(A.2) any amount required to liquidate any other unfunded liability or solvency deficiency of the fund as determined at the time of the filing of the notice of intention or of the proposal, if no notice of intention was filed,
End of inserted block 3 (1) Paragraph 81.5(1)(b) of the Act is amended by adding the following after subparagraph (i):
Start of inserted block
(i.1) an amount equal to the sum of all special payments, determined in accordance with section 9 of the Pension Benefits Standards Regulations, 1985, that were required to be paid by the employer to the fund referred to in this section and section 81.6 to liquidate an unfunded liability or a solvency deficiency,
(i.2) any amount required to liquidate any other unfunded liability or solvency deficiency of the fund,
End of inserted block (2) Paragraph 81.5(1)(c) of the Act is amended by adding the following after subparagraph (i):
Start of inserted block
(i.1) an amount equal to the sum of all special payments, determined in accordance with section 9 of the Pension Benefits Standards Regulations, 1985, that would have been required to be paid by the employer to the fund referred to in this section and section 81.6 to liquidate an unfunded liability or a solvency deficiency if the prescribed plan were regulated by an Act of Parliament,
(i.2) any amount required to liquidate any other unfunded liability or solvency deficiency of the fund,
End of inserted block 4 (1) Paragraph 81.6(1)(b) of the Act is amended by adding the following after subparagraph (i):
Start of inserted block
(i.1) an amount equal to the sum of all special payments, determined in accordance with section 9 of the Pension Benefits Standards Regulations, 1985, that would be required to be paid by the employer to the fund referred to in section 81.5 and this section to liquidate an unfunded liability or a solvency deficiency,
(i.2) any amount required to liquidate any other unfunded liability or solvency deficiency of the fund,
End of inserted block (2) Paragraph 81.6(1)(c) of the Act is amended by adding the following after subparagraph (i):
Start of inserted block
(i.1) an amount equal to the sum of all special payments, determined in accordance with section 9 of the Pension Benefits Standards Regulations, 1985, that would have been required to be paid by the employer to the fund referred to in section 81.5 and this section to liquidate an unfunded liability or a solvency deficiency if the prescribed plan were regulated by an Act of Parliament,
(i.2) any amount required to liquidate any other unfunded liability or solvency deficiency of the fund,
End of inserted block R.S., c. C-36
Companies’ Creditors Arrangement Act
5 (1) Subparagraph 6(6)(a)(ii) of the Companies’ Creditors Arrangement Act is amended by adding the following after clause (A):
Start of inserted block
(A.1) an amount equal to the sum of all special payments, determined in accordance with section 9 of the Pension Benefits Standards Regulations, 1985, that were required to be paid by the employer to the fund referred to in sections 81.5 and 81.6 of the Bankruptcy and Insolvency Act to liquidate an unfunded liability or a solvency deficiency,
(A.2) any amount required to liquidate any other unfunded liability or solvency deficiency of the fund as determined on the day on which proceedings commence under this Act,
End of inserted block (2) Subparagraph 6(6)(a)(iii) of the Act is amended by adding the following after clause (A):
Start of inserted block
(A.1) an amount equal to the sum of all special payments, determined in accordance with section 9 of the Pension Benefits Standards Regulations, 1985, that would have been required to be paid by the employer to the fund referred to in sections 81.5 and 81.6 of the Bankruptcy and Insolvency Act to liquidate an unfunded liability or a solvency deficiency if the prescribed plan were regulated by an Act of Parliament,
(A.2) any amount required to liquidate any other unfunded liability or solvency deficiency of the fund as determined on the day on which proceedings commence under this Act,
End of inserted block R.S., c. 32 (2nd Supp.)
Pension Benefits Standards Act, 1985
6 Section 9 of the Pension Benefits Standards Act, 1985 is amended by adding the following after subsection (1.2):
Insurance
Start of inserted block
(1.3) An non-countable employer may provide financial security in the form of insurance for any portion of the contributions that they are required to pay under subsection (1.1) or (1.2).
End of inserted block 7 Section 29 of the Act is amended by adding the following after subsection (8):
Amendment — liquidation, assignment or bankruptcy of the employer
Start of inserted block
(8.1) If an employer is the subject of proceedings under the Companies’ Creditors Arrangement Act or Part III of the Bankruptcy and Insolvency Act and the amount required to permit a pension plan to satisfy all obligations with respect to pension benefits and other benefits to be provided under the plan is greater than the assets of the plan, the administrator may apply to the Superintendent for permission to transfer or permit the transfer of any part of the assets or liabilities of the pension plan to another pension plan.
End of inserted block No action against administrator
Start of inserted block
(8.2) No action lies against any administrator for transferring or permitting the transfer of any part of the assets or liabilities of a pension plan to another pension plan in compliance with subsection (8.1).
End of inserted block 8 Section 40 of the Act is replaced by the following:
Annual report
40 Insertion start (1) Insertion end The Superintendent shall, Insertion start after consultation with the Chief Actuary of the Office of the Superintendent of Financial Institutions and Insertion end as soon as possible after the end of each fiscal year, submit to the Minister a report on
(a) the operation of this Act during that year; Insertion start and Insertion end
Start of inserted block
(b) the success of pension plans in meeting the funding requirements, determined in accordance with section 9, and the corrective measures taken or directed to be taken to deal with any pension plans that are not meeting the funding requirements.
End of inserted block Tabling in Parliament
Insertion start (2) Insertion end The Minister shall cause the report to be Insertion start tabled in Insertion end each House of Parliament on any of the first Insertion start 15 Insertion end days on which that House is sitting after the day the Minister receives it.
Transmission to provinces
Start of inserted block
(3) As soon as possible after the tabling of the report in Parliament, the Superintendent shall transmit the report to the relevant provincial ministers responsible for finance and provincial securities commissions.
End of inserted block Transitional Provisions
Exception — employers
9 (1) Sections 2 to 4 do not apply in respect of a person who is an employer and who, on the day before the day on which those sections come into force, participated in a prescribed pension plan for the benefit of the person’s employees until the fifth anniversary of the day on which this Act comes into force.
Exception — companies
(2) Subsections 5(1) and (2) do not apply in respect of a company that, on the day before the day on which those subsections come into force, participated in a prescribed pension plan for the benefit of its employees until the fifth anniversary of the day on which this Act comes into force.
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Published under authority of the Speaker of the House of Commons
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