Commission ban on qualifying occupational pension schemes used for auto enrolment

18 October 2017
From 1 April 2018, we can no longer support commission for Royal London plans held under qualifying occupational pension schemes used for auto enrolment.

Regulations came into force on 1 October 2017 banning member-borne commission for these schemes. The ban takes effect from 1 April 2018.

This is set out in The Occupational Pension Schemes (Charges and Governance) (Amendment) Regulations 2017.

This is the second phase of the ban on member-borne commission. The first phase banned member-borne commission on qualifying occupational pension schemes used for auto enrolment set up on or after 6 April 2016.

Which schemes are impacted by the regulation?

A small number of Royal London schemes are impacted by this second phase of the commission ban. This includes money purchase AVC only arrangements which are held under a qualifying occupational pension scheme used for auto enrolment.

We’ve written directly to the financial advisers and trustees of these schemes to let them know that commission payments will stop being paid in line with the regulations.

If you believe you have a client with a Royal London scheme which could be impacted by these regulations and you haven’t heard from us, please get in touch by email

Please note: occupational pension schemes not being used to meet an employer's auto enrolment duties, small self-administered schemes and executive pension schemes are unaffected by these regulations.

When will commission stop?

Commission is paid based on the date we receive contributions, rather than the date due. Taking account of the Easter bank holidays, commission will be paid on contributions received up to and including Thursday 29 March 2018.

Any fund based renewal commission that applies will be generated up until 31 March 2018.

Royal London’s approach

We removed or reduced any charges relating to commission payments from auto enrolment and qualifying schemes when the charge cap was introduced in April 2015 and have continued to pay commission for as long as the regulations allow. These commission payments will now stop from 1 April 2018.

We’ll write to the trustees of impacted schemes in April 2018 to confirm that commission payments have stopped and we’re therefore complying with the regulations.

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The Royal London Mutual Insurance Society Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. The firm is on the Financial Services Register, registration number 117672. It provides life assurance and pensions. Registered in England and Wales number 99064. Registered office: 55 Gracechurch Street, London, EC3V 0RL.