Pensions regulator uses anti-avoidance powers on Sea Containers

The Pensions Regulator has published Determination Notices indicating its intention to issue its first Financial Support Direction (FSD) on Sea Containers (SCL).

The Regulator said that the passenger transport and marine container leasing company SLC – as a parent company – must provide financial support for the two pension schemes of its London-based UK subsidiary Sea Containers Services (SCSL). The FSD will be issued on the company under section 43 of the Pensions Act 2004.

Tony Hobman, the Pensions Regulator chief executive, said: “Our anti-avoidance powers are significant and, as we have always stressed, we will use them proportionately and where reasonable. In this case, we concluded that the issue of a Financial Support Direction was appropriate and justified.”

At a Determination Panel hearing, representatives were heard from the Pensions Regulator; the trustees of the 1983 and 1990 SCSL pensions schemes, and SCL. The reasons of the Determinations Panel will be issued by 25 June.

SCL is said to be disappointed with the outcome of the hearing.

The FSD will be issued 28 days from the date of the determination notice. During this 28-day period an appeal may be made.

See update on 12 February 2009: Sea Containers gains approval for its financial arrangement to support two pension schemes