Supervisor of Capital Markets, Insurance and Savings Yadin Antebi has published a directive for the transfer of funds between provident funds. The new pension portability directive requires entities managing pension savings to transfer the funds accrued by an investor to another manager within 20 business days of receiving the transfer request.
The Ministry of Finance is seeking through the directive to set out the game rules and the manner in which pension portability regulations will be implemented, to enable the unrestricted transfer of funds between the various instruments and pension managers - provident funds, pension funds, and executive insurance schemes - without incurring penalty charges and without the transfer being considered a tax event.
The fund transfer directive will come into force this October, with the start of unrestricted portability between pension and provident funds, with implementation in full to take effect in early 2009 when life insurance policies enter the framework as well. The Ministry of Finance has set a timetable for the transfer of funds between the various managers on the pension market.
The directive provides that the manager receiving the funds will be responsible for transferring them in accordance with the investor's preferences. After filling out a request form the receiving manager will notify the manager currently holding the investor's money of the request within no more than two business days. The form itself should be forwarded to the transferring manager within ten business days.
Published by Globes [online], Israel business news - www.globes-online.com - on August 6, 2008
© Copyright of Globes Publisher Itonut (1983) Ltd. 2008