NETHERLANDS - The planned new Dutch pensions vehicle, known as an API, will be introduced but the legislative process may take another year still, suggests independent pension consultant Joop Rietmulder.

Rietmulder, who is also co-founder of the Dutch Circle of Pension Specialists (KPS), has described the introduction of the API as a "no brainer", saying the need for the new vehicle is evident, though various obstacles in the pension landscape will further delay its introduction.

"it is a good way of letting smaller funds merge, with each fund having its own compartment, within the internal market," said Rietmulder during the ALM 2008 conference in Amsterdam.

Frans Prins, director of the organisation for Dutch corporate pension funds (OPF), who has pleaded for the speedy implementation of ways for pension funds to cooperate, also said in a recent interview for the first issue of IPN: "The potential flexibility of the API is very attractive."

However, one of the major obstacles is the current FTK assessment framework, introduced under the recently-introduced updated pension law, argued Rietmulder.

"If the FTK regime stays in place, there is no chance for defined benefit (DB) arrangements on the international market," he forecast.

According to Rietmulder, the DB market is still growing, particularly in countries such as Germany, and if the Netherlands wants to take a share of that market, "We have to abolish the FTK".

In an earlier speech at the conference, Casper van Ewijk, of the Dutch central planning bureau and member of Netspar, has argued for a reform of the FTK, to facilitate a combination of real ambition with a nominal framework.

Van Ewijk has found the FTK regime is tailored to the Dutch situation, which is "historically a contract with nominal agreements", and should therefore be amended in the light of the increased international competition the Dutch market is facing, he believes.

Rietmulder concluded: "If there will be no fiscal freedom, we have no chance abroad."

The Holland Financial Centre, recently established to promote the Netherlands as a financial centre of excellence, said in today's published Agenda 2008-2009 it will lobby for a more level-playing field.

"In some cases, the fiscal treatment in the Netherlands is different from what is usual in surrounding countries," the report stated, adding: "An improvement of a level-playing field is necessary, preferably in the short-term."

If you have any comments you would like to add to this or any otherstory, contact Carolyn Bandel on +44 (0)20 7261 4622 or email carolyn.bandel@ipe.com

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