Medium-sized companies with pension commitments to controlling shareholder-managing directors often try to have their obligations met by a third party. Such a case may arise, for example, in the case of a planned sale of a company or a planned transfer of a business if the acquirer makes the respective takeover dependent on a “pension exemption”.
In the case of groups and affiliated companies, the aim is often not to report the pension provisions at the company obligated by the commitment, but at another group company. This other company is then also to bear the corresponding pension payments on a regular basis. For this purpose of outsourcing the pension obligations from one company, the most suitable civil law instruments are exempting debt assumption or debt assumption.
The price for the outsourcing of pension obligations by means of debt assumption or debt assumption is freely agreed and not dependent on actuarial principles. Buyers and sellers can therefore agree a price that is in line with the market on their own initiative. Accordingly, there are no operating, administration and management costs familiar from the insurance sector. Consequently, the fees agreed between the market participants directly concerned for the transfer of (direct) pension obligations described above will be below such amounts as would be required by actuarial solutions.
The outsourcing of direct pension commitments, e.g. to a pension fund, has a very high price for companies if it is really to lead to a far-reaching release from liability (i.e. a pension fund with insurance-type guarantees is chosen) compared to the “self-managed transfer”. In addition to these additional costs, there is also the residual risk that the employer will have to take responsibility at a later date if the pension fund is unable to provide the guaranteed benefits in full on a permanent basis. In the case of a so-called liquidity-saving transfer to a pension fund without an insurance-like guarantee of benefits, the initial “investment” required of the company is attractively low. However, the risk of additional contributions is very high. In fact, this is only a partial outsourcing. Only by outsourcing pension obligations in favor of controlling shareholder-managing directors of corporations within the framework of an assumption of debt in accordance with §§ 414 ff. BGB (German Civil Code), the transferring company can therefore be completely exempted from liability.
In terms of their practical implementation and their economic content, debt assumption and school membership generally have a similar effect. The main difference, however, is that the assumption of debt requires the consent of the beneficiary or beneficiaries. This consent requirement does not apply in the case of debt assumption.
In this context, Kenston Pension GmbH is your partner and service provider for all issues relating to the outsourcing of direct company pension obligations. In addition to the corresponding consulting support, we also administer and manage, together with our partner companies within the KENSTON GROUP®, specially established pension companies (“pensioner companies”) for the direct assumption of pension obligations. Contact us!