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2. shares, securities for participation capital and supplementary capital, rights of options,and3. income yielding land and buildings in an OECD country.Article 25(2) - The above investments are subject to conditions and restrictions, the mostimportant of which are as follows:1. Securities under fig. 1. and 2. above, with some exceptions, must in general be quotedat a national stock exchange or a stock exchange of an OECD country,2. Investments in assets in Euro under fig. 1. must have a value of at least 35 per cent ofthe total assets,3. A maximum of 50 per cent of the total assets may be invested in assets under fig. 2.above.4. A maximum of 20 per cent of the total assets may be invested in assets under fig. 3.above.5. A maximum of 50 per cent of the total assets may be invested in assets in foreigncurrencies according to (1) fig. 1. and 2. as well as assets according to (1) fig. 3 inforeign countries,6. A maximum of 10 per cent of the total assets according to (1) fig. 1. above may beinvested in assets from the same issuer,7. A maximum of 5 per cent of the total assets may be invested in commercial papers,8. Investments in index certificates are only permissible if they are from a financialinstitution with its seat in a “Zone A” country.Article 25(3) - Investments in share certificates of capital funds are permissible as long as1. the allocated assets, when added to the pro-rata assets held in the capital investmentfund do not breach (1) and (2) above,2. the share certificates are from a capital investment company with its seat in an OECDcountry, and3. there are no cost disadvantages to the beneficiaries.Note: The above is a summary of detailed provisions on investments which include definitionsand explanations on various provisions. The above should thus be seen only as a generalsummary of the requirements and restrictions.vi Minimum or Maximum Funding RequirementsAs stated above, pension funds are required to maintain a minimum capital of EUR 5 million.Furthermore, there are detailed provisions in the Pension Funds Act concerning calculation ofassets and funding.vii Favourable Tax TreatmentThe Income Tax Act (Einkommensteuergesetz) provides that pension contributions paidunder the Pension Funds Act in most circumstances will be recognized as tax deductable.viii Insurance RequirementsAccording to the Pension Funds Act, an application to the Austrian Financial Market Authorityfor a business licence to operate as a pension fund must be accompanied by a business plan.This business plan must contain details of the services which will be offered, an explanationof the circumstances which will protect the interests of the beneficiaries and will enable thecontinuing fulfilment of the pension fund’s obligations and detailed accounting of the contributionsand performances. Further, insurable risks which, from the business plan thepension fund is not able to pay itself, must be covered by an insurance company.- 64 -