Lawyer Eduardo Jorge Prats argued that the sentence is based on two “completely false” premises; Gianna D’Oleo considered that the sentence could not be applied
The Superior Administrative Court (TSA)in its sentence 030-02-2022, estimated that the Superintendency of Pensions (SIPEN) violated the property rights of the members who filed the lawsuit “by reducing the resources accumulated in their individual capitalization accounts for their affiliation to the Dominican Social Security System ((SDSS)”).
The high court established “considerable reductions in each of the accounts presented by the plaintiffs, as there is a difference between the balances” of January and February, and some balances of March of this year.
The TSA deemed the claim admissible and ordered the Superintendency of Pensions (SIPEN)in its capacity as regulator of the Pension Fund Administrators (AFP)to comply with articles 100 and 105 of Law 87-01 of Social Securitywhile urging SIPEN to “Return the reduced values to the plaintiffs” January, February and March of this year, considering that said deductions were not made in accordance with the law.
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Lawyer Eduardo Jorge Prats He argued that the sentence is based on two “completely false” premises. On the one hand, says Prats, the TSA recognizes a material reduction in the individual capitalization accounts as a consequence of the projected decrease in the accumulated yield in the month of February 2022; and, on the other hand, it assumes that the minimum profitability in this month was lower than the real profitability of the last twelve months and, since it was not covered with the profitability fluctuation reserve established in the law, it had to be complemented by the Administrators of Pension funds”.
Prats said that no fund managed by the AFP was below the minimum regulatory return, since in February the average annualized return was 8.98%, “all entities being above 6.98%, that is, above the minimum return required by the standard.”
Prats says that the data show that the sentence contains “serious internal inconsistencies that violate the right to reason for judicial decisions, which constitutes one of the essential guarantees of the fundamental right to due process, set forth in article 69 of the Constitution. . But in addition, this sentence generates a systemic risk for the stability of the SDSS, since it encourages the filing of recurring actions as a consequence of the projected variations in the accumulated yield”. He added that the right to social security -article 60 of the Constitution- is not observed, as well as the principles of legality -article 40.15 of the Constitution– and legal certainty-article 110 of the Constitution-.
The specialist lawyer in Social Security, Gianna D’Oleo, considered that the sentence could not be applied.
He explained that the judges base their decision on the account statements presented by the plaintiffs, “however, when verifying the updated account statements of each AFP, said deduction is not appreciated.
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“The sentence is a hard blow”
Leymi Lora, a lawyer specializing in social security, was surprised by the measure and described it as a “hard blow to a system that seeks to guarantee the well-being of the population.”
“The sentence is a vivid reflection of the lack of pension education and knowledge about the functioning of the system, a weakness that has been highlighted repeatedly,” said Lora.
He added that the decision is “very unfavorable” since he estimates that it breaks with the dynamics of the stock market, in which the workers’ funds are invested. “We see with concern how radical groups conveniently take advantage of the disinformation of citizens to gain political and social space,” he said.
The Pension Fund Administrators (AFP) explained in February that the variation reflected in the statements of accounts presented by the plaintiffs, under the allegation that the funds were “taken” from the CCI, was the product of the appreciation of the peso against the dollar, a phenomenon clearly produced by the measures that the Central Bank has taken to alleviate inflation.
Currently, the system admits investments in foreign currency, but members’ account statements only reflect the accumulated balance in Dominican pesos, a distortion that generated reactions from different sectors.
