The Law on Individual Pension Savings and Investment System was enacted on March 28, 2001 and came into effect as of October 7, 2001, six months after the date of publishment. On October 27, 2003, pension companies began operating with the approval of their first pension plans.
The Individual Pension System (BES) is a special pension system that allows people to earn income that they can maintain their standard of living in their retirement years by directing the savings they have made during their active working life into long-term investment. It also contributes to the development of the country by creating long-term resources to the economy.
As of the end of 2016, there are more than 6 million 486 thousand BES participants in the Individual Pension System, and the amount of funds has exceeded 58 billion liras. The automatic participation to BES, also known as “Compulsory Individual Pension”, was launched by the government to increase participation to the system and came into effect on January 1, 2017. As of this date, a new period has started for all employees under the age of 45.
According to the automatic plan, an employer is required to have an individual pension contract for employees under 45. Employees can opt out within two months with consent. In summary, it is compulsory to participate in the system, but it is optional to continue.
All institutions will be gradually included in automatic participation as follows: as of January 1st, 2017, enterprises with 1,000 or more employees; as of April 1st, 2017, enterprises with 250-1000 employees and civil servants (general and special budget administrations); as of July 1st, 2017, enterprises with 100-249 employees; as of January 1st, 2018, local administrations and SEEs; as of July 1st, 2018, enterprises with 10-49 employees; and as of January 1st, 2019, enterprises with 5-9 employees.
We would be pleased to provide consultancy on the system and give information on the process of bidding/insurance from insurance companies.