Boxclever Group Pension Scheme - Regulatory intervention report

We use a range of regulatory tools to help us protect savers and raise standards across the pensions system. We act proportionately based on the nature and severity of the issue to deliver effective outcomes.

Our toolkit includes both statutory powers and other regulatory measures, allowing us to identify and address risks early, often before they pose a serious risk to savers. However, when cooperation fails, there is repeated non-compliance, or serious harm occurs, we escalate to stronger actions to protect savers.

This report outlines the action we took to protect around 2,800 members of the Boxclever Group Pension Scheme who are now set to receive their benefits in full.

In this case we sought financial support for the Boxclever Group Pension Scheme from companies within the ITV group following the failure of the Box Clever business.

The case shows we will pursue complex and lengthy litigation to protect savers. It also demonstrates we remain open to settlement discussions at any time and will accept a settlement offer when it achieves a good outcome for the scheme.

This report will be useful for trustees, employers and advisers because this was the first substantive case heard at both the Upper Tribunal and the Court of Appeal regarding our anti-avoidance financial support direction (FSD) power.

The case provides helpful guidance on the application of our FSD powers. In particular, it was the first time we used our anti-avoidance powers (PA04). While we have issued contribution notices (CN) under section 38 of the PA04 on several occasions, this is the first time we have used our powers under section 47 of the PA04, where a CN is issued in respect of a failure to comply with an FSD.

Published: 6 November 2025

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Case summary

In this case we successfully used our FSD power against ITV plc and four associated companies which were required to provide financial support for the Boxclever Group Pension Scheme. An FSD is a direction issued by TPR’s Determinations Panel to one or more entities requiring them to provide reasonable financial support to a pension scheme. That financial support is flexible and can include, but is not limited to, cash, guarantees or some other form of security.

This outcome means all members of the scheme are expected to receive their benefits in full following a bulk transfer to an ITV sponsored scheme. Members whose benefits had been restricted to Pension Protection Fund (PPF) levels will also receive back payments plus agreed interest.

The targets in this case sought to challenge the decision to issue FSDs through lengthy litigation pursued before the Upper Tribunal, Court of Appeal and Supreme Court but were unsuccessful.

Following the issue of the FSDs, we were initially unable to reach an agreement with the targets over the level of financial support required. We therefore issued a warning notice seeking a s47 CN for the full buy-out deficit of the scheme.

Throughout this process we continued to engage with ITV plc and the four associated companies to discuss potential settlement and, in the summer of 2024, we reached an agreement with all interested parties which should see all members receive their full benefits.

Background

Box Clever was formed in June 2000 as a joint venture between the TV rental businesses of Granada (now ITV) and Thorn (then owned by Carmelite Capital). Box Clever borrowed approximately £0.9 billion to buy the two businesses and paid around two thirds of that amount to Granada and one third to Thorn. This lending arrangement was set up with no recourse to either Granada or Thorn, but they retained shareholdings in Box Clever so had the potential to benefit from future profits.

Relevant Granada and Thorn employees were moved across into the new combined business and subsequently enrolled in the Boxclever Group Pension Scheme with a promise of benefits mirroring benefits of the schemes they were transferred from.

Box Clever struggled from the start due to a significant fall in revenues and its high level of acquisition debt. It became loss-making in 2002 and entered administration in 2003. The scheme subsequently entered a PPF assessment period on 10 November 2014 and members’ benefits were restricted to PPF levels from that point.

Scheme trustees attempted over several years to negotiate the return of the members to the Granada and Thorn schemes. These ultimately failed, and we opened an investigation to consider the use of our FSD power.

Regulatory action

Our investigation initially considered both ITV/Granada and Thorn/Carmelite as targets. Our preliminary view was that one of the legal tests, the requirement for a target to be associated and/or connected with the scheme employer, was not met as a result of the appointment of administrative receivers to the scheme’s statutory employers in 2003. However, we later formed the view that this was not the case and that it would be reasonable and appropriate for targets on the ITV side of the joint venture to be the subject of regulatory action.

In September 2011 we issued a warning notice to ITV plc and four associated companies. The targets were:

• ITV plc
• Granada UK Rental & Retail Limited
• Granada Media Limited
• Granada Group Limited
• Granada Limited

The case was heard by TPR’s Determinations Panel (DP) in December 2011, which determined that FSDs should be issued. ITV plc and the four associated companies referred the case to the Upper Tribunal in early 2012 on multiple grounds. Following six years of litigation, the case was finally heard by the Upper Tribunal in January 2018.

The six years of litigation included:

• an application by the scheme trustees to be added as an interested party, which was challenged by the targets
• an application by the targets for further disclosure
• a strike out application by the targets for part of our case.

The strike out application was heard by the Upper Tribunal and then appealed by the targets to the Court of Appeal. The Court of Appeal judgment provided some helpful guidance on how we can argue our cases before the DP and the Upper Tribunal.

At the substantive Upper Tribunal hearing in January 2018 the targets challenged the decision of the DP to issue FSDs to them. Issues raised included:

• whether the association and connection test was met
• retrospectivity – the events occurred before the introduction of PA04
• discriminatory treatment – as we had not taken action against Thorn/Carmelite
• whether there was an absence of morally hazardous conduct
• the relationship between the targets and the scheme and its employer
• the benefit received by the targets
• the conduct of the trustees

The Upper Tribunal heard evidence from witnesses and experts as well as extensive legal debate over a two-week hearing. Following the hearing, the Upper Tribunal concluded that it was reasonable to issue FSDs against ITV plc and the associated companies.

The targets appealed the decision to the Court of Appeal and a hearing took place in April 2019. The main issues before the court on appeal were:

• whether the association and connection test was met
• retrospectivity – the events occurred before the introduction of PA04
• whether the Upper Tribunal’s approach to reasonableness was legally flawed

The Court of Appeal dismissed the targets’ appeal with full reasons. ITV plc and the associated companies then sought leave to appeal to the Supreme Court, but this was refused in February 2020.

In March 2020, we issued FSDs to ITV plc and the associated companies requiring them to put in place reasonable financial support for the scheme within six months. We received one proposal from them during this period for a transfer of some members (formerly employed by Granada) to an ITV sponsored scheme but we concluded it did not represent reasonable financial support for the scheme as a whole. ITV’s position was that it should not be responsible for the members (formerly employed by Thorn).

We continued to engage with ITV plc and the associated companies beyond the six-month deadline in an attempt to reach an agreement. However, when this proved unsuccessful, we issued a warning notice in May 2022 seeking a s47 CN for failure to comply with the FSDs. The amount sought was the full buy-out deficit of the scheme, which at the time was around £120 million, with an additional buffer to mitigate against any adverse market movements in buy-out pricing. We received representations from the targets in November 2022 and we issued a response in July 2023.

Outcome

Settlement discussions continued with ITV plc and the associated companies, the scheme trustees and the PPF and, in July 2024, we reached an agreement with all interested parties. By this time, in line with market movements generally, the scheme’s buy-out deficit had reduced to around £77 million.

The targets agreed to a bulk transfer of all around 2,800 members into the ITV Pension Scheme and to make back payments to those members whose benefits had been restricted to PPF levels since the PPF assessment period started.

The bulk transfer of members was completed on 1 October 2025 following a comprehensive data cleansing exercise and after the overriding legal requirements for a bulk transfer without member consent were satisfied. Following the transfer, back payments plus interest will now be made and members should receive their full scheme benefits.

Clarifying TPR enforcement cases and the FSD legislation

This case provided helpful clarity on both the FSD legislation and our enforcement cases more generally, specifically:

Retrospectivity (Court of Appeal, 2019)

The courts recognised that DB schemes will often have been affected by

decisions/circumstances from before the introduction of PA04. We are not precluded from relying on such matters as part of our enforcement case; any “retrospective” elements of the case can be taken into account when assessing the reasonableness of an FSD.

Discrimination (Upper Tribunal, 2018)

The fact that there may be other parties who could potentially be targets of our enforcement action, but who are not pursued, does not stop it being reasonable to issue an FSD against a party.

Reasonableness factors (Court of Appeal, 2019)

The factors contained within the legislation are not all required to be present for an FSD to be issued and the list is not exhaustive. All relevant factors should be considered and given appropriate weight depending on the circumstances of the case. In particular, the courts confirmed that it was not a requirement that the targets received a benefit, albeit in this case the courts concluded that these targets had received benefits (which had value even if that value could not be readily quantifiable).

Scope of TPR’s case (Court of Appeal, 2015; Upper Tribunal, 2016)

We may be permitted to raise a new case before the Upper Tribunal that was not previously included before the DP. Whether we will be permitted to do so in any particular case is a matter of general discretion on the part of the Upper Tribunal.

Timeline of events

Date/period	Event
June 2000	Box Clever formed as a joint venture between Granada and Thorn.
September 2003	Box Clever entered administration.
September 2011	S43 FSD warning notice issued to all five targets.
December 2011	The DP issued a Determination Notice determining that it was reasonable to issue an FSD against the targets.
January 2012	The targets referred case to the Upper Tribunal.
December 2013	The Upper Tribunal rejected the targets’ attempt to strike out elements of TPR’s statement of case.
March 2015	The Court of Appeal rejected the targets’ appeal of the Upper Tribunal’s decision of December 2013, remitting the matter to be considered again by the Upper Tribunal on the basis of the test explained by the Court of Appeal.
July 2015	The Supreme Court denied the targets’ attempt to obtain permission to appeal the Court of Appeal’s decision.
November 2016	The Upper Tribunal dismissed the remitted strike out application (having the heard the matter in a further hearing in June 2016).
May 2018	The substantive s43 PA04 hearing at the Upper Tribunal having taken place in January 2018, the Upper Tribunal ruled in TPR’s favour. Permission was then granted for this to be appealed to the Court of Appeal.
June 2019	The Court of Appeal ruled in TPR’s favour, following a hearing in May 2019.
February 2020	The Supreme Court denied the targets’ attempt to obtain permission to appeal the Court of Appeal’s decision.
March 2020	FSDs issued against the targets with a six-month deadline to propose reasonable financial support.
May 2022	S47 CN warning notice issued to all five targets.
July 2024	TPR agreed a settlement with the five targets to complete a bulk transfer of the members of the Boxclever Group Pension Scheme into the ITV Pension Scheme.
October 2025	Bulk transfer of all members of the Boxclever Group Pension Scheme into the ITV Pension Scheme is completed.
Early 2026	Back-payments of underpaid pension plus interest to be paid to members of the Scheme by the trustees of the ITV Pension Scheme.