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Q & A

Here you will find answers to the most common questions regarding the Swedish Fund Selection Agency's activities. The development of the agency's operations is ongoing, and the agency’s activities will be gradually established after the summer. The questions and answers will be updated and supplemented continuously.

More questions and answers can be found on the Swedish Pensions Agency's website External link, opens in new window..

Questions on draft examples of parts of the tender documents

Why has the Swedish Fund Selection Agency proposed a minimum requirement regarding assets under management?

A minimum requirement regarding a fund manager's and investment manager's total volume under management may be required to reduce the premium pension saver's risk of choosing funds from a fund manager that cannot fulfil its commitments. Since the agreement period will be long, it is important that the fund managers have the financial resources to develop their operations over time and can fulfil the EU's extensive and resource-intensive compliance and reporting regulations. The minimum AUM threshold may vary depending on the type of fund being procured. This will be communicated in connection with each procurement. The minimum AUM requirement will not be retroactive. The point of time on which the minimum requirement applies will be specified in the tender documents.

Why does the Swedish Fund Selection Agency need information from fund managers on matters such as cybersecurity and audit reports?

The Swedish Fund Selection Agency will procure funds for the premium pension fund platform, which falls within the framework of the Swedish social insurance system. Therefore, special requirements must be set in the procurements to protect the interests of the pension savers. The requirement in the area of IT and cyber security follows from the DORA Regulation (Regulation (EU) 2022/2554 of the European Parliament and of the Council, Digital Operational Resilience for the Financial Sector) and aims at ensuring that participants in the financial system have taken the necessary protective measures to counteract cyber-attacks and other IT-related risks.

To what extent will historical transactions be required to be submitted by fund managers and investment managers respectively?

The scope of the historical data that the Swedish Fund Selectionw Agency will require will be specified in the tender documents and in the fund agreement for each procurement.

To what extent will historical NAV prices be required from fund managers?

All fund managers may need to submit historical NAV prices for the fund that is subject to procurement. The extent of the historical data that the Swedish Fund Selection Agency will require will be specified in the tender documents for each procurement, but will not exceed 10 years.

Will all types of SFDR Article 9 reporting funds be able to submit a tender for the procurements?

All Article 9 reporting funds, irrespective of whether an index has been selected as a benchmark or not, will be able to submit tenders, unless otherwise specified in the requirements of the respective procurement.

How should the tender fee be paid?

Payment instructions will be included in the tender documents .

Background

Why has a new agency been created for the procurement of premium pension funds?

The pension committee, representing the political parties behind the pension system, has agreed that while the premium pension system should be retained, the government needs to take greater responsibility for the election of funds and the overall design of the premium pension system. The purpose is to ensure that the premium pension fund platform provides funds of high quality at as low a cost as possible. This is to strengthen opportunities for creating better pensions.

The procurements must always be carried out in the best interests of the pension saver and the pensioner. The Government and the pension group have decided that there should be an agency responsible for procuring funds and managing the fund platform in the premium pension system. The Swedish Fund Selection Agency’s mandate is to carry out this assignment on the basis of the principles laid down by law. The Swedish Fund Selection Agency is intended to be decoupled from political control; the Government should not have the opportunity to influence which individual funds are made eligible on the fund platform.

The Swedish Fund Selection Agency – a so-called board agency –is governed by a board. The Swedish Fund Selection Agency also has a host agency, namely, the Swedish Pensions Agency.

What is the mandate of the Swedish Fund Selection Agency?

The Swedish Fund Selection Agency has a mandate to procure a wide selection of funds of high quality and different risk profiles for the premium pension fund platform, all in accordance with the Act concerning the procurement of funds for the premium pension fund platform. The Swedish Fund Selection Agency will enter into fund agreements in accordance with the same law.

The procurements must be carried out professionally and, on an independent basis. Furthermore, through these procurements, the Swedish Fund Selection Agency will ensure that pension savers have real freedom of choice. It will also ensure that fund managers and funds are assessed in a safe and cost-effective manner. The agency will also be responsible for the liquidation of the current fund platform and for how premium pension holdings are transferred to the procured fund platform.

The legislation governing the Swedish Fund Selection Agency’s overall tasks and principles is described in the Legislative Council's referral and was decided by the Swedish Riksdag during the spring of 2022. We will provide continuous updates with new and additional information.

The laws that regulates the Swedish Fund Selection Agency:

Lagen om upphandling av fonder till premiepensionens fondtorg, SFS 2022:760 ,  External link, opens in new window. Lagen om Fondtorgsnämnden, SFS 2022:759  External link, opens in new window.and 64 kap. socialförsäkringsbalken External link, opens in new window..

What is the difference between today's fund platform and the new procured fund platform?

The current fund platform is application-based, which means that fund managers apply to the Swedish Pensions Agency to be allowed to provide a fund on the fund platform. If the fund manager meets the requirements, the fund manager and the Swedish Pensions Agency will enter into a fund agreement and the fund will be made eligible on the fund platform.

Now, the fund platform will be changed so that the funds are instead procured in accordance with a special set of rules for procurement of funds, regulated by law and described in the Legal Council's referral. This means that different categories of funds are procured and that requirements are placed on both the fund manager and the fund. In addition to this, the funds will be evaluated. For example, requirements and award criterias regarding suitability, ability, quality, performance, durability, and fees can be set.

The funds that best meet the evaluation criteria set out in each procurement will be selected and may sign time-limited fund agreements with the Swedish Fund Selection Agency. The funds will be regularly reviewed and followed up.

The organization of the Swedish Fund Selection Agency

What does it mean that the Swedish Pensions Agency is the host agency for the Swedish Fund Selection Agency?

This means that the Swedish Fund Selection Agency can benefit from the Swedish Pensions Agency's processing and administrative resources as well as its competence, while at the same time remaining independent in its decisionmaking.

What are the respective roles of the Board and its office?

The office of The Swedish Fund Selection Agency and its units perform the operational activities of The Swedish Fund Selection Agency. The board of The Swedish Fund Selection Agency decides on the guidelines and directives that the office follows in its work. The board makes all strategic decisions for The Swedish Fund Selection Agency.

Is the board involved in making decisions on the choice of funds?

The office will prepare decision-making documents that the board will decide on.

When will vacancy ads be published?

The Swedish Fund Selection Agency do not accept expressions of interest from applicants but rather refer applicants to current advertisements on the Swedish Pensions Agency's website. External link, opens in new window.

How many people will work for the Swedish Fund Selection Agency?

A reasonable estimate is that between 25–30 people will work for the office of the Swedish Fund Selection Agency. Everyone who works with the Swedish Fund Selection Agency’s activities will be employed by the Swedish Pensions Agency and is part of the Swedish Pensions Agency's organization. The Swedish Pensions Agency will be the host agency, and will thus be responsible for processing and administrative services on behalf of the Board.

Will the technical support be developed, meaning will you go from manual systems to automatical order processing?

The government authority will develop its operations based on the technical systems and support that is used today.

Can the Swedish Fund Selection Agency enter into partnerships with fund management organizations?

To ensure the equal treatment of all actors, the Swedish Fund Agency cannot enter into partnership with fund management organizations.

Law of procurement of funds to the fund platform of the Swedish premium pension

Is it possible to appeal an award decision?

Yes. However, the aim is that a dialogue with the market, a thourough evaluation and equal treatment of all tenderers from start to finnish in the process will give transparency and create trust for both the award decision and the Swedish Fund Selection Agency.

Is there anything in the new legislation that put an increased responsibility on the Swedish Fund Selection Agency?

The legislation does not entail a shift in the responsibility on the procured fund platform compared to the fund platform today. The saver will still bear the financial risk in the choices made on the fund platform.

How can fund managers enter into a fund agreement with the Swedish Fund Selection Agency?

On June 20, 2022, the legislation was changed so that no fund agreements can be entered into using the previous application procedure. New fund agreements can only be entered into in accordance with the new regulations with procured funds.

Will you send an example of the new fund agreement between the Swedish Fund Selection Agency and the fund company?

Yes, a draft fund agreement will be made available in connection to each procurement.

How do you view the procurement law?

The legislation that govern the work of the Swedish Fund Selection Agency provides a support and framework for its daily work.

Will the new fund agreement between Swedish Fund Selection Agency and the fund managers include a requirement to provide Swesif's sustainability profile?

No, there will be no requirement in the fund agreement to provide a link to Swesif's sustainability profile. The requirement in the fund agreement will be to provide a link to the statutory RTS templates that applies since 1 January 2023.

From Q1 2023, the Pensions Authority will offer the possibility to link on the fund portal to Swesif's sustainability profile which has updated its template with information from EU regulations regarding SFDR articles 6, 8 and 9 and parts of the taxonomy. It will be voluntary for managers to display their sustainability information to savers via the link to Swesif's sustainability profile.

The range of funds on the procured fund platform

How does The Swedish Fund Selection Agency ensure the right to real freedom of choice in the investment of premium pension funds?

The Swedish Fund Selection Agency has an obligation to ensure the savers' freedom of choice. Freedom of choice should be understood as being central to savers' demand. It is the ambition of The Swedish Fund Selection Agency to offer a high quality range of funds for savers to make their individual choices.

Is it possible to submit multiple submissions within a category? Can a fund manager have several different funds on the procured fund platform?

Yes. However, please note that the submission fee is charged for every individual submission.

How many funds per category will there be?

Decisions on the number of funds procured per category are based on what is deemed best for savers and may therefore vary between categories.

How will the volume be distributed within the categories of the procured fund platform?

The board will make a decision for each category procured, based on a number of factors. Funds already affiliated that are procured will retain their volume.

Nordic equity: Does this also include procurement of individual countries in the Nordics?

What each category is comprised of will be clearly stated in connection to each procurement.

What asset classes do "European equities" include?

What each category is comprised of will be clearly stated in connection to each procurement.

Will the procurements only focus on the existing categories?

Looking at the existing categories is a good way to gain an understanding of which categories that are to be procured to the fund platform, but this does not mean that the range of categories are limited to those on the platform today.

What categories will be prioritized in the start of the procurement?

The first four categories to be procured, without mutual order, is European equity; Active and index, Global Equity; index, Nordic equity; active, and Global Fixed Income.

Which are the 30 categories to be procured?

The around 30 categories to be procured will be made public in due time for the start of each procurement.

Is there a possibility that there will be new fund categories created for future procurements, in addition to the existing categories?

There is a possibility to procure new categories in the future, if deemed in the interest of the saver. The Swedish Fund Selection Agency will stay informed on external aspects, new strategies and products as well as continousuly evaluate the range of funds on the platform.

Will there be an advantage for funds who offer institutional share classes? Will it be beneficial in the evaluation?

What each category is comprised of and what criteria will be evaluated will be clearly specified in connection to each procurement.

Will you be able to procure ETFs or anything other than UCITS funds?

Only Swedish and foreign UCITS, Swedish special funds, and foreign equivalents to such special funds (if they can be marketed to non-professional investors in Sweden) can be procured to the fund platform. What each category is comprised of will be clearly specified in connection to each procurement.

Can an industry fund participate in the European equities category?

It is up to each tenderer to asses its funds relevance and suitability for each procurement.

Will a fund be restricted to a certain category - for example, if it changes, will it have to be procured again?

If changes in a fund results in it no longer meeting the criteria that was met at the time of the award, an evaluation will take place, where a potential breach of agreement will be investigated. As the range of funds is designed to offer the savers a variation of funds on the platform as a whole, the fund will remain in the category it was procured to, as long as it lives up to the terms and conditions in the fund agreement.

Are there plans to continue developing the fund platform with other funds than UCITS, such as illiquid assets and alternative asset classes, considering the long term nature of the premium pension savings?

As of now, the same requirements on liquidity will apply for the future procured funds as for the funds on the platform today. The Swedish Fund Selection Agency will continuously review the criteria for the procurements and the offering on the fund platform, and monitor market trends and the needs of the savers.

Can you share the number of funds that will be avaliable in the larger categories? For example for Global equity, Swedish Equity, Swedish small cap.

The number of funds within each category will vary as the range of funds will be designed with the savers interest in focus, both within each category and on the platform as a whole. The number of funds in each category will be decided by factors such as the number of funds available within each category that meets the requirements, price and volume, among else.

Can a Global Fixed Income funds (Investment Grade Credits) be part of the category global equity?

It is up to each tenderer to asses its funds relevance and suitability for each procurement.

How do you define the saver's needs?

The Swedish Fund Selection Agency analyses the prerequisites for each category, historical data as well as external factors, among else.

What is your view on mixed funds and target date funds?

All categories on the fund platform will be evaluated within the scope of our assignment.

Does AIFs with daily liquidity have an equal chance to be procured as UCITS funds?

What each category is comprised of will be clearly specified in the procurement material.

How many global index funds can there be on the fund platform?

The number of funds of each kind there will be on the platform will be decided in the procurement process - in the design of the range of funds, by the evaluation process and the funds available to procure, all with the savers interest in focus.

Will the number of funds per category increase over time? And will there be a possibility for new funds to enter the fund platform after the initial procurements?

If a need to procure a new category arises, this will be evaluated. The Swedish Fund Selection Agency will stay informed on external aspects, new strategies and products as well as continousuly evaluate the range of funds on the platform and procure new categories if deemed being in the interest of the saver.

Will Russian funds be a category?

The category is today removed from the fund platform.

Will the savers be able to access more information about the funds than on the fund platform today? Will the procured fund platform be more communicative?

The Swedish Pension Agency has been given an assignment from the government to develop the fund selection architecture. The aim is that the range of funds on the platform should be characterized by a high level of transparency and that the saver can make conscious investment choices. The Agency will work closely together with the Pension Agency to keep the saver well informed.

There are many so called enhanced index funds on the market. Can these take part of a procurement in a category for passive funds? That is, funds that are not legally index/passive funds with a permit.

Before each procurement, a procurement material willl be presented where the different criteria are presented. It is then up to each tenderer to asses its funds relevance and suitability for the category.

Is there a risk that the assets under management will flow out of Sweden and Swedish fund companies, when the requirements on the fund platform are raised?

The fund managers that best meet the criteria for suitability, cost-efficiency, sustainability, controllability and quality in the procurements will be awarded and offered to sign a fund agreement regarding funds on the premium pension fund platform. In Sweden, there are many funds of high quality that will have good chances of being awarded in the procurements, but the interests of the pension savers will always be in focus.

The procurement process

When will the first procurement of funds take place?

The preliminarily assessment is that the first procurements will be launched during the the spring quarter of 2023.

When will notice be made for the first procurement?

The Swedish Fund Selection Agency will share more information regarding the approximate time for the notice of the first procurement as soon as possible. If the time frame to submit tenders should occur during normal periods of vacation, this will be taken into account when the Swedish Fund Selection Agency decides on the deadline for tenders.

Will the criteria for managed capital outside the platform continue to exist?

Criteria that already exist for affiliated funds will continue to exist for affiliated funds. The terms and conditions for to the fund platform today will be replaced by qualification critera. This will be communicated in connection to each procurement.

Will the submissions have to be written in Swedish or do you also handle other languages?

There is an ongoing investigation into language requirements in procurement.

Is there a deadline for when the entire current fund marketplace will be replaced by new procured funds?

There is no strict deadline, but our ambition is to complete the procurement of the new funds by 2025. However, quality is always our priority and is more important than the estimated timetable.

In procurement of funds, will the funds affiliated with today's fund platform have an advantage or will they be handled separately?

No, there is no advantage to having funds on the current fund platform. All fund companies can submit tenders for the procurements, regardless of whether they are on the funds platform or not, and all fund companies will be treated equally according to the procurement.

Fund managers who do not have their funds on the fund platform today but are interested in procure for the new platform do not need to first add their funds to the current fund platform to participate in a future procurement.

For how long will a procurement last?

In the coming years, The Swedish Fund Selection Agency will carry out several procurements within different fund categories. The dates set for the closing date of the submissions will be communicated through the procurement material applicable to the respective fund category. At present, we anticipate approximately 6 months from the notice to award.

What external third-party sources will be used by the agency for data and information collection?

The Swedish Fund Selection Agency will make use of all sources deemed relevant and necessary in its evaluation.

What governs the order in which you procure fund categories?

The order of the procurements is determined by a framework of priorities based on several factors.

How will you weigh the different criteria in the evaluation? How is price weighted?

The award criteria are based on the requirements of cost-efficiency and high quality. The weights for each criteria will be communicated for each procurement.

If a fund is popular on the fund platform today, will this be taken into account during the procurement?

No. All tenderers will be treated equally in the procurement process.

Will AP7 be evaluated by you in any way, and will they too charged with the costs of 0,5-1,5 base points?

The state pre selection AP7 Såfa will not be evaluated by the Swedish Fund Selection Agency but will continue to be managed by AP7, that has entered a cooperation agreement with the Swedish Pension Agency. There is no legal justification for the Swedish Fund Selection Agency to charge the annual fee from AP7. The cost for the operations of AP7 is charged the savers in AP7.

You speak a lot about asset management, but does this only apply to portfolio management? Will staffing and surrounding services be evaluated?

The Swedish Fund Selection Agency will make an overall evaluation of the fund company's organization and its support, where all dimensions such as risk management, reporting, compliance and more will be evaluated. How the evaluation look like will be described in detail in the procurement material for each procurement.

How long time is the period between notice of the procurement and deadline for the tender? Can this vary?

The time period will be communicated in connection to each procurement. Depending on the fund category to be procured, the period between notice and deadline for the tender could vary.

Will a notice of an RFI be made for the RFP?

As part of each procurement, there will be qualification criteria. The funds that live up to these critera will be evaluated. Details regarding the procurement process will be communicated in due time before each individual procurement.

Will it be possible to request and obtain the results from other fund companies tenders?

Feedback on the procurement results will be offered upon request to the tenderers in the procurement, where the results of a certain fund company is showed relative to the results of the other tenderers. According to the Public Access to Information and Secrecy Act, a confidentiality review will be done when a request to access an official document is submitted.

Ongoing monitoring and quality-assurance

What happens to a procured fund that subsequently breaches a criterion, how quickly will this fund be withdrawn from the fund marketplace?

The funds on the new procured fund marketplace will be reviewed on an ongoing basis against both the evaluation criteria and the set qualification requirements for the procured funds. If a fund no longer meets the evaluation criteria set by The Swedish Fund Selection Agency, this may lead to a breach of contract and possible termination. The length of time taken for the winding up process will vary from fund to fund.

Can The Swedish Fund Selection Agency guarantee that there will not be a fraudulent fund companies on the fund platform?

The funds on the new procured fund platform will be continously monitored on both the award criteria and the qualification criteria for the procured funds. If a fund no longer meets the award criteria set by The Swedish Fund Selection Agency, this may lead to a breach of contract and possible termination. The length of time taken from breach of agreement to withdrawal from the fund platform will vary from fund to fund.

The proposition states that fund managers will be involved in the monitoring process. What information and to what extent will fund managers be required to submit data annually for the ongoing review process?

As with the qualification and award criteria, the monitoring will also be increased to ensure quality, with more extensive material collection than for the current fund platform. As today, questionnaires will be sent out that needs to be submitted, possibly with a higher frequency than today. Once the frequency is decided, it will be communicated to the market. What needs to be shared with the Swedish Fund Selection Agency will also be specified in the fund agreements.

Removing a fund from the fund platform can cause movements on the market, how will you handle this?

It is a risk the Swdish Fund Selection Agency is aware of and will take into account. However, this is not a new phenomenon, similar fund platforms in the world has worked in the same way before where one have been able to see market fluctuations after removing a fund, but this is natural. The Agency's monitoring of the funds will contribute to an increased readiness for this. Removing funds from the platform that declines in quality could mean certain transaction costs, but the added value that the savers get in the high quality of the funds on the platform will make up for these costs long term.

What does it mean that termination can occur due to a decline in quality?

The funds on the new procured fund platform will be continously monitored on both the award criteria and the qualification criteria for the procured funds. If a fund no longer meets the award criteria set by The Swedish Fund Selection Agency, this may lead to a breach of contract and possible termination. The interests of the saver always come first, and in order to meet the goals of higher future pensions, continuous monitoring of quality is a prerequisite.

Sustainability

Will you have a definition of what sustainability means for the platform?

The legislation states that the fund agreements should contain terms and conditions stating that the assets should be managed in an exemplary manner with regards to sustainability. A minimum criteria should be that the fund manager in the asset management must observe what follows from such international agreements that Sweden has entered into, with regards to sustainability.

An extensive work of forming a sustainability strategy for the fund platform is underway, that among else will contain a definition of the meaning of sustainability for the platform. The qualification criteria for sustainability on the fund platform will be clearly defined in the procurement material for each category.

What are the Swedish Fund Selection Agency's opinions on SFDR classification and how will the procurements take it into account?

For each category, the Swedish Fund Selection Agency will decide on the qualification criteria and award criteria that among else contains sustainability requirements.

Will the new fund agreement between Swedish Fund Selection Agency and the fund managers include a requirement to provide Swesif's sustainability profile?

No, there will be no requirement in the fund agreement to provide a link to Swesif's sustainability profile. The requirement in the fund agreement will be to provide a link to the statutory RTS templates that applies since 1 January 2023.

From Q1 2023, the Pensions Authority will offer the possibility to link on the fund portal to Swesif's sustainability profile which has updated its template with information from EU regulations regarding SFDR articles 6, 8 and 9 and parts of the taxonomy. It will be voluntary for managers to display their sustainability information to savers via the link to Swesif's sustainability profile.

Fees

Is there a risk that as The Swedish Fund Selection Agency grows, a higher fee than what is currently proposed has to be charged?

Fees will be kept under review and adjusted if necessary, based on cost coverage.

Will the agency negotiate the price at the end of the submission process or does the price stated at the beginning of the submission apply?

Both approaches are possible. This will be clearly stated in the procurement documents. It is important to remember that quality comes before price.

How will the Swedish Fund Selection Agency be financed?

The Agency’s activities will be financed through tender fees and an annual fee from the procured funds covering the costs of the activities conducted in accordance with law. The Swedish Fund Selection Agency is not financed by grants from tax funds. The organization is to be financed outside the state budget. Read more about the fees here.

Can the Swedish Fund Selection Agency share the planned discount models?

The current discount model for funds on the fund platform today will be phased out and replaced by a fee model based on procurement.

The transition to the procured fund platform

What will happen with the funds already chosen by the pension savers?

In the first stage: nothing. A pension saver still has control over the selected funds and can choose and change funds in the same way as before.

If the pension saver has chosen a fund that no longer exists on the fund platform after completion of a procurement of the relevant fund category, due, for example, to the fund manager choosing not to participate in the procurement or the fund not being procured at all and hence not being eligible on the fund platform, the Swedish Pensions Agency will contact the pension saver and provide further information.

For a period, there will be funds on the fund platform that are both affiliated in accordance with the current regulations (which eventually will cease) and have been procured in accordance with the new law.

What happens to the funds and fund managers who currently have an agreement with the Swedish Pensions Agency?

The current fund agreement with the Swedish Pensions Agency will be changed in such a way that the Swedish Fund Selection Agency will take over the responsibility for certain parts of the agreement. This will apply until the current fund category has been the subject of a procurement.

After procurement of a fund category, the current fund agreement will be terminated, and the Swedish Fund Selection Agency will then enter into new fund agreements with the fund managers who have been selected in a procurement. The selection is based on the award criteria decided by the Swedish Fund Selection Agency, which in turn are based on frameworks and requirements under the new law.

How does the transition work? Do the savers have to change to a procured fund?

For a fund to be made available on the new fund platform, the fund manager needs to submit a tender and be awarded a fund agreement for the fund. The transition to the new platform will be gradual as the procurements are made category by category, and will be preceded by an implementation phase where the agency will work together with the fund managers and the units affected at the Swedish Pension Agency. If a fund on the current platform is not offered a procured fund agreement, the pension savers affected will be contacted by the Swedish Pension Agency.

If you have a fund registered today, will this be removed from the fund platform if one does not participate in the procurements?

Yes. The savers in these funds will then be contacted by the Swedish Pension Agency.

Will the transition be mandatory?

The transition will be done gradually, where funds that are not procured will be removed from the fund platform as the categories are procured one by one.

Categories that are not procured to the fund platform, will they be removed from the platform in 2025?

Categories that are removed from the platform will be removed gradually, as the new categories are procured and the transition to the procured fund platform is done. The transition will be done in parallell with the procurement, that will be overlapping for the fund platform to be procured in 2025.

Will you use professional transition managers to ensure efficiency in the fund transitions?

The transition to the new fund platform will be handled by internal competence within the office of the Swedish Fund Selection Agency and affected units within the Swedish Pension Agency, such as the trading unit and the fund information unit. The Swedish Fund Selection Agency will monitor and follow up on the transition, to make sure that the savers are not affected by unneccessary transaction costs.