From October 1, 2018, existing master trusts had until March 31, 2019 to apply to the TPR for authorisation to demonstrate that they have met required standards.
Under the new registration process they have to hold enough capital to cover the cost of a worst-case scenario, such as the cost of transferring to another scheme or of winding up, without charging members.
The change in legislation prompted more than half of the 81 master trusts operating in the market in January 2018 to leave, partly because they realised their business could no longer be classed as a master trust, while some others entered.
As part of the TPR’s supervision all master trusts will have to submit documents regularly, including an annual supervisory return.
TPR will run periodic scheme evaluations against the authorisation criteria and closely monitor the market going forward, it has pledged.
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