ARHIVELE OLTENIEI - Universitatea din Craiova

Reforming Romanian Pension System: The Necessity of Supplementary Private Pensions 305obligation to participate to the new system, the equality of treatment for allparticipants, contributivity, capitalization and assets investment in a prudent andefficient way, as well as guaranteeing the solvability of pensions funds privatelymanaged. This law regulates the setting up, organization, management andprudent supervision of the system based on pensions funds privately managed,the attributions of the Committee of Supervising Pension Funds, the organizationand management of the pension funds administrators. The administrator gets theparticipants contributions, administrates and invests the financiary resources ofpensions fund privately managed, calculates and pays private pensions.Participation to pensions funds privately managed is compulsory forpersons being less than 35 years old, newly entered on labor force market, andfacultative for other categories of persons being less than 45 years old which arealready insured and contribute to public system of pensions. Persons aged lessthan 45 years old which are already insured and contribute to public system canalso participate to a pension fund privately administrated. Persons who did notadhere to a pension fund in a 6 months time since the date when they wereforced to participate, are distributed by the institution of evidence to a pensionfund, through the effect of the law.Adhesion is individual, on the basis of a contract concluded between theparticipant and the administrator. The transfer of participants to other funds ofthe same type is permitted under the conditions of the law.The contribution to pensions funds privately managed represents a partof the individual social insurance contribution to the public system of pensionsand is duty-free. Calculation base is limited, under law conditions. At thebeginning of the collecting activity, contribution quantum is a percent of 2%applied to calculation base so that, in 8 years since the beginning of collection,the contribution share will be raised to 6%, starting with an increase of 0,5%every year. Personal shares are the participants’ property and are duty-free.The guarantee of the new system of pensions privately administratedwill be assured through clear and prudent rules of profitableness, such as: thesetting up, by the administrator, of a reserve fund of at least 25% of share capitalwhich is meant to assure the profitableness rate of pension fund until the level ofminimum rate of profitableness, as well as the compensation of participants,beneficiaries and survivors’ rights in case of non-acquittal or improper acquittalof administrator’s obligations resulted from administration contract; setting up aguarantee fund, constituted from proper funds of administrators and interestsresulted from their administration 5 .The administrator of a pension fund privately administrated is a jointstock commercial company which has, as exclusive activity object, fund’sadministration, calculation and pay of private pensions. Fund’s administration isaccomplished in exchange for a charge paid by the participants. After Romania’s5 Raluca Vasiliu, Pensions Funds Privately Administrated, in Juridical Guide forCommercial Companies no. 9/2005, p. 48-49.