16 October 2023

Personal notice to each policyholder?

By Prof. Hans van Meerten

The Court of Rotterdam delivered a judgment with potentially very far-reaching implications for the value transfer of participants' pensions.

It requires the regulator, De Nederlandsche Bank N.V. (DNB), to ensure that participants are personally and properly informed when rights and obligations are transferred. This is set out in the judgment. It could have major implications for pension providers as well as for the new pension law.

Current legislation

In the current situation, DNB instructs a life insurer to give notice of a transfer of pension in the Government Gazette and in other ways to be determined by DNB, in accordance with Article 3:119(1) of the Financial Supervision Act (Wft). At the same time, DNB announces the period within which the policyholders concerned may object to the transfer in writing to DNB. In line with the second paragraph of this article, DNB does not grant consent if one-fourth or more of the policyholders have opposed the proposed portfolio transfer within this period.

Interest of policyholders?

The court held that “in other ways to be determined by DNB” should be read as “in other ways to be determined by DNB in the interests of policyholders”. This decision is based on the background to the introduction of Article 3:119(1) of the Financial Supervision Act. Consequently, DNB does not have complete discretion as to how the life insurer should give notice of the proposed portfolio transfer, but must keep the interests of policyholders in mind at all times.

Not properly informed

The court considered that by instructing the life insurers (Optas/Aegon) to announce the intended value transfer in the Government Gazette and in three national daily newspapers, DNB “did not take sufficient account of the interests of the policyholders and therefore misapplied Article 3:119(1) of the Financial Supervision Act”.

The court held that:

 “The court shares the plaintiffs’ view that, to the extent this notice has already reached them, it fails to properly inform policyholders of the proposed portfolio transfer”.

Consequences of conversion

Therefore, although this is a regulatory norm under the Financial Supervision Act, it may also be relevant to pension funds. The consequential effect of the duty of care standard in financial law, such as proper disclosure, can also apply to pension law. Moreover, the judgment potentially has major implications for conversion. This refers to changing and converting existing pensions into the new system. If pension funds are required to personally notify participants of major changes to their pensions, conversion becomes virtually impossible.

In conclusion

As it currently stands, certain pension participants are treated differently than the normal consumer under financial law. Such as pension participants of compulsory industry pension funds. This can no longer be justified. The high degree of legal protection these participants rightly enjoy should also apply to pension participants. It seems to us that ‘collectivity’ and ‘solidarity’, as justification for the exceptional position of pension funds, have had their day. In this sense, it is incomprehensible that the individual right of objection is being removed in the case of conversion.


More information

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Prof. Hans van Meerten

Prof. Hans van Meerten


Professor Hans van Meerten is a specialist in the field of pension law, financial law and EU law.

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