Skip to main content

Your browser is out of date, and unable to use many of the features of this website

Please upgrade your browser.


This website requires cookies. Your browser currently has cookies disabled.


CDC code in force: 1 August 2022

This code of practice is issued by The Pensions Regulator (TPR), the body that regulates occupational pension schemes in the UK. It relates to the authorisation and supervision of collective money purchase schemes (known as collective defined contribution or CDC schemes), which were introduced by the Pension Schemes Act 2021 (the Act) and the Occupational Pension Schemes (Collective Money Purchase Schemes) Regulations 2022 (the Regulations).

The publication of this code of practice is a statutory requirementIT1. This code’s purpose is to set out clearly how an application for authorisation must be made and how we will assess the matters that the regulations require us to take into account in deciding whether we are satisfied that a scheme meets the criteria for authorisation. The code will help those involved in CDC schemes to understand how to satisfy us that the authorisation criteria are met at application and continue to be met throughout supervision.

It sets out the information we expect to use for our assessment, and the standards we expect to see. If we are not satisfied that a CDC scheme meets all the criteria, we must refuse to authorise it. Our decision on this will be informed by the expectations in this code.

This code is primarily aimed at those involved in the operation of a CDC scheme, for example trustees and their advisers.

This code assumes that trustees have a good knowledge of all relevant legal requirements and of our expectations in other codes of practice, which may apply in addition to this code and the CDC legislation. Codes of practice that apply to pension schemes generally or to DC schemes will also apply to CDC schemes unless there is a specific exemption.

Our statutory objectives are:

  • to protect the benefits of pension scheme members
  • to reduce the risk of calls on the Pension Protection Fund (PPF)
  • in relation to the exercise of functions under Part 3 of the Pensions Act 2004 only, to minimise any adverse impact on the sustainable growth of an employer
  • to promote, and improve understanding of, the good administration of work-based pension schemes
  • to maximise compliance with the duties and safeguards in the Pensions Act 2008

We have several regulatory tools, including issuing codes of practice, to enable us to meet our statutory objectives. Codes of practice give practical guidelines about the requirements of pension legislation and set out standards of conduct and practice expected of those who must meet these requirements.

This code is supported by a number of products, including guidance, which assist trustees in applying for authorisation and throughout supervision to understand the evidence that must be provided.

Status of this code of practice

Codes of practice are not statements of the law and there is no direct penalty for failing to comply with them, although the legislation requires some parts of this code to be complied with and may provide for penalties if they are not. This is known as a legislative underpin, and the code indicates which parts this applies to. In addition, when determining whether the legal requirements have been met, a court or tribunal must take account of any provisions of a code that it considers relevant.

The code distinguishes between legal duties and our expectations by using the word ‘must’ when referencing legal duties, and ‘should’ for our expectations. We use ‘need’ if the process is necessary to allow a scheme to operate but there is no expectation or legal requirement.

The code highlights key aspects of the Regulations and sets out how we will assess the matters that the Regulations require us to take into account in deciding whether we are satisfied that a CDC scheme meets the authorisation criteria. This includes the information we expect to take into account in our assessment and the standards we expect to see. If we are not satisfied that a CDC scheme meets all the criteria then we must not authorise it (or may de-authorise it), and our decision on this will be informed by the expectations we have set out in this code.

We are required to consider the matters set out in the Regulations. The code sets out some factors as ‘more likely to satisfy’. These factors are not specifically required by the legislation but if one or more are present, we are more likely to be satisfied that the underlying legal requirements are met. Trustees may choose a different approach to satisfy us that all of the authorisation criteria have been met.

If there are grounds to issue a risk notice, improvement notice or compliance notice, we may direct a person to take, or not to take, steps specified in the notice. These directions may be worded by reference to a code of practice issued by us, and failing to comply with an improvement notice or compliance notice carries a penalty.

If we decide not to authorise a CDC scheme, or to de-authorise a CDC scheme after it has been authorised, the reasons for our decision may refer to this, or any other, code of practice.


The Act sets out the framework for authorisation and places a duty on us to assess an application for authorisation against the criteria. It also prohibits a person from operating a scheme that falls within the definition of a CDC scheme unless it has been authorised. The legislation sets out the matters that we must take into account in respect of each of the authorisation criteria. For a CDC scheme to be authorised, we must be satisfied that it meets all the authorisation criteriaIT2.

This code sets out how we will assess the matters set out in the legislation in deciding whether we are satisfied that a CDC scheme has met the criteria. The code should be read in conjunction with the relevant legislation and accompanying guidance that gives more practical information about how trustees can show that the scheme meets the authorisation criteria.

The application for authorisation must be submitted by the trustees and must be in our required formatIT3. The application form will guide trustees through the information and evidence that must be submitted.

If a CDC scheme that has not been granted authorisation starts to operate, it must cease operating and wind up. A CDC scheme that has been authorised must also wind up if it is subsequently de-authorised.

We expect trustees to be open and honest in the information they provide and in their dealings with us. Providing false or misleading information could lead to a CDC scheme not being authorised or being de-authorised.


Once a CDC scheme is authorised, those running it must continue to satisfy us that it meets the authorisation criteria. Our continuing assessment of this is called supervision.

Supervision is a risk-based, proactive process that allows us to understand how a CDC scheme continues to meet the authorisation criteria. As part of this process, we will require trustees to submit a supervisory return containing updates against the criteria. We can ask for this no more than once a year. Significant events must also be reported to us as they may have an immediate impact on a scheme’s continuing ability to meet one or more authorisation criteria.

If we are no longer satisfied that a CDC scheme meets the authorisation criteria, we may take regulatory action, including de-authorising itIT4.

Legal references

IT1 Sections 90(2)(jc) and (jd) of the Pensions Act 2004

IT2 Sections 9(4) and (5) of the Act

IT3 Sections 8(1) and (2) of the Act

IT4 Section 30(1) of the Act