OSFI approval of reducing amendments to Canadian pension plans also confirmed
MONTREAL, Dec. 19, 2013 /CNW Telbec/ - Air Canada said today that the Government of Canada has advised the airline that, further to the agreement announced on March 12, 2013, new regulations applicable to Air Canada's pension funding obligations have been formally approved.
The new regulations, scheduled for publication on January 1, 2014, were approved under the Pension Benefits Standards Act in respect of special payments under Air Canada's domestic defined benefit registered pension plans for the period between 2014 and 2020 inclusive, expiring December 31, 2020. As part of the new regulations, Air Canada will be required to make payments of at least $150 million annually with an average of $200 million per year, to contribute an aggregate minimum of $1.4 billion over seven years in solvency deficit payments, in addition to its current service payments. Air Canada may elect to opt out of the new regulations under certain circumstances.
In addition, previously announced changes to the early retirement provisions in Air Canada's Canadian defined benefit plans have been approved by the Office of the Superintendent of Financial Institutions and will become effective on January 1, 2014.
Air Canada will provide an update on the solvency position of its Canadian defined benefit plans when it reports its 2013 full year results in the first quarter of 2014.
About Air Canada
Air Canada is Canada's largest domestic and international airline serving more than 175 destinations on five continents. Canada's flag carrier is among the 20 largest airlines in the world and in 2012 served close to 35 million customers. Air Canada provides scheduled passenger service directly to 60 Canadian cities, 49 destinations in the United States and 67 cities in Europe, the Middle East, Asia, Australia, the Caribbean, Mexico and South America. Air Canada is a founding member of Star Alliance, the world's most comprehensive air transportation network serving 1,328 destinations in 195 countries. Air Canada is the only international network carrier in North America to receive a Four-Star ranking according to independent U.K. research firm Skytrax that ranked Air Canada in a worldwide survey of more than 18 million airline passengers as Best Airline in North America in 2013 for the fourth consecutive year. For more information, please visit: www.aircanada.com.
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SOURCE Air Canada