Introduction

CDC code in force: 31 July 2026

1. This code of practice relates to the authorisation and supervision of collective defined contribution (CDC) schemes. These are also known as collective money purchase schemes.
2. This code applies to CDC schemes that are single and connected employer schemes introduced by the Pension Schemes Act 2021 and the Occupational Pension Schemes (Collective Money Purchase Schemes) Regulations 2022 (‘the 2022 Regulations’). This code also applies to unconnected multiple-employer schemes introduced by the Occupational Pension Schemes (Collective Money Purchase Schemes (Extension to Unconnected Multiple Employer Schemes and Miscellaneous Provisions) Regulations 2025 (‘the 2025 Regulations’).
3. In this code, where we use the term ‘multi-employer CDC schemes’ this refers to unconnected multiple-employer schemes. Where we use the term ‘single-employer CDC schemes’ this refers to single and connected employer schemes. Unless otherwise specified in this code, where a scheme is sectionalised, references in this code to a scheme, a CDC scheme, a multi-employer CDC scheme or a single-employer CDC scheme, refer to each section of the scheme that provides CDC.
4. Where a legal duty or expectation is different or applies differently in law for single employer CDC and multi-employer CDC schemes this is made clear in this code, for example for ‘single-employer CDC schemes only’ and for ‘multi-employer CDC schemes only’. Where this is not specified, it should be assumed that the legal duty or expectation refers to both single-employer CDC and multi-employer CDC schemes.
5. The publication of this code of practice is a statutory requirement¹. Its purpose is to set out how to apply for authorisation and how we assess whether a scheme meets the criteria for authorisation, both at application and throughout supervision. It sets out the information we require to make our assessment and the standards we expect to see. If we are not satisfied that a CDC scheme meets all the relevant criteria, we must refuse to authorise it².
6. This code is primarily aimed at those involved in the operation of a CDC scheme, for example trustees, scheme proprietor (multi-employer CDC schemes only), and their advisers.
7. This code assumes that trustees have a good knowledge of all relevant legal requirements and 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.
8. 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. 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. Failing to comply with a risk notice, improvement notice or compliance notice carries a penalty³.
9. This code is supported by guidance, which will help trustees to understand the evidence.

Status of this code of practice

10. The purpose of the code is to set out how to apply for authorisation, and how we assess whether a scheme meets the criteria for authorisation, both at application and throughout supervision. 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.
11. Codes of practice are not statements of the law and there is no direct penalty for failing to comply with them. However, the legislation requires some parts of this code to be complied with, which is known as a legislative underpin, and may provide for penalties if they are not. 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.
12. 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.
13. The code highlights key aspects of the regulations. It sets out how we will assess the matters that the regulations require us to consider when deciding whether we are satisfied that a CDC scheme meets the authorisation criteria at application and throughout supervision. 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 will not authorise it (or may de-authorise it). Our decision on this will be informed by the expectations we have set out in this code.
14. 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.
15. 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 code, or any relevant code of practice.
16. The Pension Schemes Act 2021 sets out the framework for authorisation and places a duty on us to assess an application for authorisation against the authorisation 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 criteria⁴.
17. Trustees and any scheme proprietor should 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 deauthorised. 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.
18. Once authorised, a multi-employer CDC scheme is expected to start operating within 24 months starting from the date on which we received the application for authorisation. In the event this timeframe cannot be met, the trustees should contact us to request a short extension⁵ which, if granted, may be up to six weeks.

Legal references

¹ Sections 90(2)(jc) and (jd) of the Pensions Act 2004

² Section 9(5) of the Pension Schemes Act 2021

³ Sections 29(1), (4) and (11) of the Pension Schemes Act 2021

⁴ Sections 9(4) and (5) of the Pension Schemes Act 2021

⁵ Section 9A(3) of the Pension Schemes Act 2021

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