Ontario Pension Funding Relief Regulation

The Ontario pension regulator, the Financial Services Regulatory Authority ("FSRA"), announced new funding relief for defined benefit pension plans registered in Ontario. The Ontario government filed a new regulation on September 21, 2020, which will permit plan sponsors to defer pension contributions, for the months from October 2020 to March 2021. Employers who elect to take advantage of the deferrals will be subject to certain restrictions involving share dividend and redemption, executive compensation and loan transactions. All deferred contributions plus interest must be fully repaid by March 31, 2022.

Overview

Regulation 520/20 (the "Regulation") is intended to assist employers maintaining and supporting their day-to-day business operations by allowing pension contributions to be deferred, freeing up cash to support operational requirements. Under the Regulation, all contributions including normal cost, provision for adverse deviations in respect of the