MEPs Scrap Mandatory 2% Venture Capital Allocation in EU Pension Overhaul

A planned obligation that would have forced large European pension funds to channel money into venture capital has been dropped by the European Parliament's economic affairs committee, which adopted its negotiating stance on the reform of the EU's occupational pension rules.

The Committee on Economic and Monetary Affairs backed the negotiating mandate for the revision of the directive known as IORP II by 33 votes to 18, with 3 abstentions, according to reports dated 10 November 2026. The decision moves the legislative package into its decisive parliamentary stage, where the framework governing pension funds and occupational retirement providers across the European Union is to be redrawn.

Venture capital requirement removed from the text

The proposal tabled by rapporteur Damian Boeselager of the Greens/EFA group had stirred debate in the sector ahead of the vote. It would have required pension funds managing assets of more than EUR 1 billion to invest at least 2 percent in venture capital. Committee members rejected the provision and struck the planned minimum quota from the text entirely.

Also removed were plans to grant additional powers to the European Insurance and Occupational Pensions Authority and a single EU-wide disclosure form. In their place, the adopted committee position emphasises easing investment rules: national investment limits for certain asset classes are to fall away under the parliamentarians' plans.

Newly established occupational pension institutions would benefit from a lighter regime applying during their first three years of operation. Risk assessment requirements, including climate factors, are to be scaled proportionally to the size and operational complexity of each institution.

Data safeguards and member information

Beyond investment rules, the draft sets new guardrails on how insured persons' data is handled and how members are informed. Use of pension data for marketing purposes would be prohibited.

At the same time, the proposed rules aim to strengthen disclosure obligations towards policyholders. Among the measures envisaged is a standardised benefits overview designed to let people compare national and cross-border retirement schemes directly.

Before talks with the Council of the European Union and the European Commission can begin, the committee's decision must be formally announced in the European Parliament's plenary session.

Trilogue negotiations with member states are reportedly targeted to start in January 2027, although the precise timetable had not been officially confirmed at that point. The coming rounds will determine which compromises between the parliament's position and those of the member states make it into the final directive text.