The government, however, has revised its position with respect to these pension commitments.
The proposal requirement that all existing pension commitments within a period of three years be externalized, has been replaced by a proposed mandatory externalization as from 1 January 2012 of new pension commitments and of increases of existing commitments.
The program law of 22 June 2012 will implement this measure.
Internal provision, key man insurance
Until now, individual pension commitments financed through an internal provision or through “key man insurance” do not need to be externalized because they do not fall within the scope of the law concerning the supervision on institutions for occupational pensions.
Effective 1 January 2012, recording an internal provision in order to finance a new individual pension commitment is no longer allowed. Existing provisions, which are recorded in the accounts at the end of the last accounting period closed before January 2012 may be maintained, but they cannot be increased.
Key man insurance also cannot be used anymore to finance individual pension commitments. Still, the mandatory externalization does not apply to insurance contracts concluded before 1 July 2012 in order to finance such pension commitments. These insurance contracts can be further financed, but contributions may not finance increased (higher) benefits than those initially provided by the contracts.
Read a July 2012 report, prepared by the KPMG member firm in Belgium: Internal provisions and key man insurances: the end?