OSFI approval of reducing amendments to Canadian pension plans also
MONTREAL, Dec. 19, 2013 /CNW Telbec/ - Air Canada said today that the
Government of Canada has advised the airline that, further to the
agreement announced on March 12, 2013, new regulations applicable to
Air Canada's pension funding obligations have been formally approved.
The new regulations, scheduled for publication on January 1, 2014, were
approved under the Pension Benefits Standards Act in respect of special payments under Air Canada's domestic defined
benefit registered pension plans for the period between 2014 and 2020
inclusive, expiring December 31, 2020. As part of the new regulations,
Air Canada will be required to make payments of at least $150 million
annually with an average of $200 million per year, to contribute an
aggregate minimum of $1.4 billion over seven years in solvency deficit
payments, in addition to its current service payments. Air Canada may
elect to opt out of the new regulations under certain circumstances.
In addition, previously announced changes to the early retirement
provisions in Air Canada's Canadian defined benefit plans have been
approved by the Office of the Superintendent of Financial Institutions
and will become effective on January 1, 2014.
Air Canada will provide an update on the solvency position of its
Canadian defined benefit plans when it reports its 2013 full year
results in the first quarter of 2014.
About Air Canada
Air Canada is Canada's largest domestic and international airline
serving more than 175 destinations on five continents. Canada's flag
carrier is among the 20 largest airlines in the world and in 2012
served close to 35 million customers. Air Canada provides scheduled
passenger service directly to 60 Canadian cities, 49 destinations in
the United States and 67 cities in Europe, the Middle East, Asia,
Australia, the Caribbean, Mexico and South America. Air Canada is a
founding member of Star Alliance, the world's most comprehensive air
transportation network serving 1,328 destinations in 195 countries.
Air Canada is the only international network carrier in North America
to receive a Four-Star ranking according to independent U.K. research
firm Skytrax that ranked Air Canada in a worldwide survey of more than
18 million airline passengers as Best Airline in North America in 2013
for the fourth consecutive year. For more information, please visit: www.aircanada.com.
CAUTION REGARDING FORWARD-LOOKING INFORMATION
Air Canada's public communications may include forward-looking
statements within the meaning of applicable securities laws.
Forward-looking statements, by their nature, are based on assumptions
and are subject to important risks and uncertainties. Forward-looking
statements cannot be relied upon due to, amongst other things, changing
external events and general uncertainties of the business. Actual
results may differ materially from results indicated in forward-looking
statements due to a number of factors, including without limitation,
industry, market, credit and economic conditions, the ability to reduce
operating costs and secure financing, pension issues, energy prices,
employee and labour relations, currency exchange and interest rates,
competition, war, terrorist acts, epidemic diseases, environmental
factors (including weather systems and other natural phenomena and
factors arising from man-made sources), insurance issues and costs,
changes in demand due to the seasonal nature of the business, supply
issues, changes in laws, regulatory developments or proceedings,
pending and future litigation and actions by third parties as well as
the factors identified throughout Air Canada's public disclosure file
available at www.sedar.com. Any forward-looking statements contained in this news release
represent Air Canada's expectations as of date of this news release and
are subject to change after such date. However, Air Canada disclaims
any intention or obligation to update or revise any forward-looking
statements whether as a result of new information, future events or
otherwise, except as required under applicable securities regulations.
SOURCE: Air Canada
For further information:
Isabelle Arthur (Montréal) 514 422-5788
Peter Fitzpatrick (Toronto) 416 263-5576
Angela Mah (Vancouver) 604 270-5741