KDPW administers the Guarantee Fund and manages its resources.
The Guarantee Fund collects contributions from pension fund companies (PTE) dedicated to payments to members of open-ended pension funds necessary to cover losses caused by non-performance or undue performance of obligations of pension fund companies in the management and representation of a fund unless such loss was caused exclusively by the party who suffers a loss.
The resources of the Guarantee Fund include the basis resources and the reserve resources. The basic resources are made up of contributions of pension fund companies. The reserve resources are built by investing Fund resources as well as collecting penalty interest on outstanding contributions to the Fund.
The Guarantee Fund operates according to:- Act on Organisation and Operation of Pension Funds of 28 August 1997 (Journal of Laws of 2013, items 989, 1289, and 1717);
- Regulation of the Council of Ministers of 28 January 2014 concerning the Guarantee Fund (Journal of Laws of 2014, item 141).
Contributions to the Guarantee Fund (basic resources)
Contributions of pension fund companies are equal to 0.3% of the net asset value of the open-ended pension fund managed by the pension fund company as at the last valuation date in the previous calendar quarter.
Contributions are made in cash. Pension fund companies make contributions to the bank account in the National Bank of Poland indicated by KDPW. The amount of contributions is set on a quarterly basis. If any payment is made from the Guarantee Fund, pension fund companies make replenishment contributions to restore the original amount of the Fund’s resources.
Contributions to the Guarantee Fund are not subject to enforcement as part of assets of pension fund companies.
Investing the Resources
According to the Regulation of the Council of Ministers, KDPW may invest the resources of the Guarantee Fund in bonds, bills and other transferrable securities issued or guaranteed by the National Bank of Poland, the State Treasury of Poland, governments or central banks of EU Member States or contracting parties to the European Economic Area Agreement or member states of the Organisation for Economic Co-operation and Development.
KDPW may transfer resources of the Guarantee Fund to bank accounts, including term deposits, maintained with a domestic bank whose equity is equal at least to the PLN equivalent of EUR 100 million.
The Regulation also defines limits on the share of invested resources per class of instruments and per bank.
Payments from the Guarantee Fund
Payments from the Guarantee Fund may only be made in favour of members of open-ended pension funds:- To cover losses caused by non-performance or undue performance of obligations of pension fund companies in the management and representation of a fund unless such loss was caused exclusively by the party who suffers a loss to the extent that the pension fund company is not liable for such loss. In that case, payments are made on the basis of legally valid court decisions which:
- assert the existence and the amount of compensation due to a member of an open-ended pension fund from the resources of the Guarantee Fund; or
- orders KDPW to pay compensation to a member of an open-ended pension fund from the resources of the Guarantee Fund Payments are made within 14 days of presentation of a court decision to KDPW.
- To cover losses caused by non-performance or undue performance of obligations of pension fund companies in the management and representation of a fund for which the pension fund company is liable to the extent that such losses cannot be covered with bankruptcy assets of the company. In that case, payments are made on the basis of documents presented by a member of an open-ended pension fund to KDPW. The list of documents is set out in § 20 of the Regulation of the Council of Ministers of 28 January 2014 concerning the Guarantee Fund. In that case, payments are made within 14 days of presentation of relevant documents by a member to KDPW.