There are many advantages to being a staff member of the European Institutions. One significant advantage is that EU Civil Service schemes provide very good pensions for those who qualify.
People who leave the EU without the legislated 10 years qualifying service and without having reached retirement age, are not eligible for the anticipated EU pension. However, they do have the option of transferring accrued EU pension rights to a pension in their own names.
"Under the Staff Regulations of Officials of the European Communities and the Conditions of
Employment of Other Servants of the European Communities adopted by Council Regulation 259/68, as amended by Council Regulation 723/2004 (directly applicable in all Member States of the European Union), officials, temporary staff and contract staff whose service terminates for reasons other than death or invalidity without their qualifying for an immediate or deferred retirement pension have the right, on leaving the service, to transfer the actuarial equivalent of their accrued pension rights in the EU civil service pension scheme."
Indeed, the pensions leaving letter from the EU practically encourages people to transfer by concluding with the following sentence;
"Finally, please bear in mind that if you delay your transfer request until a later date, this may cause serious problems when it comes to making the transfer."
This facility includes the following European institutions:
- The Commission
- Court of Justice
- Court of Auditors
- Fusion for Energy ( F4e )
So why would you want to transfer your accrued EU pension? Well, it is essential to point out that it may not be appropriate for everyone to transfer out of the scheme. This will depend on your personal circumstances. However, there are two reasons why a transfer may be appropriate for you.
In the event that you die after leaving the scheme (with less than 10 years' service) there is no death benefit payment made. Secondly, your EU pension will, in effect, be frozen as at the date of your leaving.
As a consequence of these two points, if you think they are applicable to you, then you could consider a transfer. A transfer will allow you to have a payment on death. As an example, if the transfer value is 125,000€ (a not unusual figure) then in the event of your death there would be 125,000€ available to your family or heirs. Also your money can grow. Take the example if you leave the EU at age 35 you will get up to 30 years opportunity for your money to grow. As your money grows, your death benefit grows.
You cannot transfer your pension to any alternative pension. The new pension that receives the transfer value has to follow some terms and conditions that are laid out by the EU. (Annex VIII to the Staff Regulations). The pensions have to confirm in writing to the EU that they will follow these conditions:
- There must be the facility for death benefit
- The pension must be taken between the ages 60 to 65
- The pension can only be used to provide a pension, there is no lump sum payment
Should you wish to examine the possibility of a transfer, the procedure is as follows:
You provide a letter of authority to approach the EU to confirm your pension transfer value.
We undertake a review of your personal circumstances.
We provide you with a report based on an analysis from our in-house highly qualified pensions' experts along with guidance on what action to take. We provide the con's as well as the pro's of a potential transfer so that you get a full and balanced assessment.
If you decide to transfer then we will help you to choose the pension company that will best suit you, including ensuring they comply with the EU requirements above. Indeed, we have a number of companies that have simplified their processes having already had confirmation from the EU that their pensions comply with the rules. Any costs are kept to a minimum.
With our assistance, an application form is completed and your new pension is set up. Your EU pension is then transferred directly into your new pension.
As part of our ongoing service, we provide regular reviews. These reviews include an update on regulation and law, a review of the economic circumstances to ensure your pension is invested correctly and, finally, a review of your personal circumstances (for example, if you are going to change the country where you live).
We understand the EU civil service pension. Established contacts have already been made with case handlers in the European Institution offices of Administration and Payment of Entitlements Department. We also understand how important it is for you to have sound advice and assistance with making the right decision for you.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.