Savings and Investments Union: publication of supplementary pensions package

In its Communication of March 19, 2025, on the Savings and Investments Union (SIU), the European Commission (the "Commission") proposed preparing a package of measures, together with other initiatives, to boost supplementary pensions and help European citizens channel their savings toward capital markets. For more information on the SIU, see our Post | Savings and Investments Union: key points and analysis.

As a result, the Commission has now published a package of measures aimed at boosting supplementary pensions in the European Union (EU), consisting of the following legal acts:

• Communication of November 20, 2025: Increasing the capacity of the EU’s supplementary pensions sector to improve retirement income and provide long-term capital to the EU’s economy (COM(2025) 839 final).
• Recommendation (EU) 2025/2384 of November 20, 2025, on pension tracking systems, pension dashboards and auto-enrollment (OJEU L, 27.11.2025).
• Proposal of November 20, 2025, of the European Parliament and of the Council, amending Regulation (EU) 2019/1238 on a pan-European Personal Pension Product (PEPP) (COM(2025) 840 final).
• Proposal of November 20, 2025 of the European Parliament and of the Council, amending Directives (EU) 2016/2341 and 2016/97 as regards the strengthening of the framework for occupational retirement provision (IORP II) (COM(2025) 842 final).

In this post, we outline the main proposals and lines of action that constitute this supplementary pensions package.

Pension tracking systems, dashboards and auto-enrollment

To improve supplementary pension schemes, the Commission recommends Member States adopt the following measures: 

• Pension tracking systems (PTS)
  Development of PTS which, thanks to a free digital tool (a secure web portal or mobile application), give citizens:

• an overview of their pension rights across public, occupational and personal pension schemes (pillars one, two and three, respectively). The information must be clear and adapted to the different needs of each age group; and
• access to projections of their expected retirement income from all the pension schemes to which they belong.

PTS adopted nationally must be compatible with a future connection to the European Tracking Service for data sharing, supporting EU cross-border labor mobility and the exchange of individual pension information within the EU.

• National pension dashboards
  Establishment of national pension dashboards: tools that enable each Member State to obtain a comprehensive overview of their pension systems(both public and supplementary)covering indicators of current and future pension entitlements of Member States at an aggregate level.
  
  The objective of these national pension dashboards is to provide Member States with continuously updated global aggregated data that helps detect inefficiencies that may affect the adequacy and sustainability of their pension systems.

• Auto-enrollment mechanisms
  Promotion of auto-enrollment in supplementary pension schemes for both workers and the self-employed.
  
  This measure reflects the Commission’s firm commitment to incorporate mandatory enrollment mechanisms that co-exist with traditional voluntary participation in supplementary pension schemes. The Commission's approach is justified by the (i) positive results from auto-enrollment mechanisms in other countries (e.g., the United Kingdom), (ii) worrying decline in public pension replacement rates relative to average gross wages in the EU, and (iii) low participation rates in supplementary pension schemes.
  
  The Commission recommends that auto-enrollment mechanisms be designed and introduced in a way that preserves the integrity of existing public or supplementary schemes, respects the autonomy and role of social partners, and includes the following elements and good practices:

• A clear definition of the population eligible for auto-enrollment, with a broad and inclusive approach that considers different career patterns; flexibility in contribution levels across career stages; fair treatment of career breaks; and equal opportunities for men and women, young workers, and low-income workers.
• Identification of the types of supplementary pension schemes suitable for mandatory enrollment (occupational pension plans, other individual pension products or PEPPs);
• Well-designed opt-out and re-enrollment possibilities.
• Identification of different investment strategies based on participants’ risk profiles and life-cycle, with default options for those who are unable or unwilling to choose their own strategy.
• A range of pay-out arrangements (lump sum, lifelong annuity, or a combination of both) as well as appropriate conditions for early withdrawal in the case of individual needs.
• For employment-based systems, broad coverage that enables auto-enrollment from an early age, with affordable costs and public subsidies for implementation by companies. The portability of auto-enrolled workers’ rights within the EU must be permitted.
• Greater flexibility with auto-enrollment for self-employed workers and workers with non-standard contracts.
• Establishment of tax and other incentives—harmonized at EU level—for the benefit of auto-enrollment schemes, respecting the tax incentives of existing occupational or personal pension plans, particularly schemes promoted by social partners.

Proposal to amend the PEPP regulation

The proposed regulation to amend the current PEPP regulation aims to make this product more accessible for both providers and savers. The main measures are:

• Ensuring that the tax treatment of PEPPs in Member States is comparable to that of other national supplementary personal pension products.
• Requiring the registration process for new PEPPs to include information on compliance with product oversight and governance requirements, particularly demonstrating how the PEPP's expected financial returns are reasonable compared to costs and charges borne by the saver (value for money).
• Including historical data on PEPPs’ costs and performance in the central public register maintained by the European Insurance and Occupational Pensions Authority.
• Increasing coordination between Member States in the supervision of cross-border PEPPs.
• Removing the requirement for PEPP providers to open sub accounts in at least two Member States.
• Amending the Basic PEPP regulation to: provide financial advice on an independent basis and only at the saver’s request; adapt the underlying investment strategy to the investor's life-cycle; require that 95% of assets be invested in listed financial instruments and non-complex financial instruments, leaving 5% for other financial instruments like alternative assets; and remove the 1% cap on costs and fees.
• Amending the Tailored PEPP by removing the current limitation of up to six underlying investment options available to the saver. This would allow the Tailored PEPP to be designed around each saver’s preferences and risk profiles, while ensuring transparency, comparability and consumer protection. In particular, Tailored PEPPs could be promoted within occupational pension schemes, including through auto-enrollment schemes.
• Relaxing investment rules applicable to PEPP providers, by replacing the “prudent person rule” which legally specifies eligible types of financial instruments suitable for investments, with a “prudent person principle,” permitting investments in  all types of financial instruments if the providers apply appropriate risk management and ensure that overall investment portfolio management is aligned with the objectives, risk profile, and best interests of the PEPP savers.
• Preventing obstacles that hinder the transfer of savings to another PEPP, especially in the event of PEPP deregistration.
• Requiring Basic PEPP and Tailored PEPP providers to provide savers information on payment methods, costs, and taxation arising from the payment of pension benefits one year before the pension payments start and again when payments start.

Proposal to amend Directive (EU) 2016/2341 of the European Parliament and of the Council of December 14, 2016, on the activities and supervision of Institutions for Occupational Retirement Provision (IORP)

The Commission's supplementary pensions package also includes a proposal to amend the Directive of December 14, 2016, on the activities and supervision of IORPs.

The proposed measures address the challenges posed by schemes that are too small to diversify their investments and deliver optimal outcomes for savers. Respecting the role of social partners in occupational pension schemes, the aim is to modernize and strengthen the framework for occupational pensions, improving efficiency, scalability, and saver confidence.

The amendments focus on improving protection for savers and removing barriers to market-driven consolidation. This will result in occupational pension plans operating more efficiently, reducing their costs, and improving the diversification of investment portfolios, particularly towards equity instruments, thereby increasing the return on savings and indirectly helping European companies access financing.

The Commission’s supplementary pension package comes amid significant concern and debate about the sustainability of public pension schemes in light of sustained growth in the retired population, low birth rates and the weak wage competitiveness of the working population financing the pension system.

In Spain, a prior public consultation has recently been completed on a possible reform of the pension plans and funds regulation to eliminate the maximum annual financial contribution limits to pension plans and enable the cross-border transfer of vested rights in individual pension plans. Although the draft bill confirming this approach has yet to be published, the processing of this legislative initiative could provide an ideal opportunity to address the implementation of the Commission's proposals in favor of national supplementary social welfare.

For more information, please contact our Knowledge and Innovation Area specialists.