FSCO Policies And FST Decisions

Article by Paul Dimitriadis, © 2007, Blake, Cassels & Graydon LLP

Originally published in Blakes Bulletin on Pension and Employee Benefits, August 2007

New FSCO Policies

S900-751 – Undistributed Surplus on Full or Partial Wind-Up.

This replaces S900-750 (Surplus Remaining in Wound Up Plans). Following the Supreme Court’s Monsanto decision, the policy states that on a partial wind-up, surplus assets held in the wound-up portion of the plan are required to be allocated and distributed at the time of the partial wind-up. Of note, the policy provides that until the distribution of all assets is completed: (i) the assets of the plan’s fund, or the wound-up portion, should be invested in accordance with the statement of investment policies and procedures (amended if necessary) and in a manner that reflects the size and nature of the benefit and surplus obligations; and (ii) the actual or notional split of the assets of the partial wind-up must be maintained.