The draft regulation for European pension products, called PEPP (Pan-European Pension Product), is intended to set European rules and quality standards for retirement provision products.
This would make these pension products comparable and transferable to other countries across the EU. Insurance companies, banks, funds or asset managers would be able to offer these products throughout the EU.
The EU-branded product will allow workers hopping from country to country to save seamlessly into one pot.
To make the EU pensions more attractive to savers, the Commission will recommend national governments give the pan-European product the most favourable tax treatment they are able to provide.
It had been hoped that the tax treatment of pensions could be harmonised as part of the proposal, but that has not survived consultation with the member states.
Providers of the new pension will also need to live up to high levels of transparency over fees, as concern grows that savers are currently left in the dark about the charges being taken from their savings.
Sven Giegold, Parliament's Greens/EFA group spokesperson on economic and financial policy, has welcomed the move.
On Friday, Giegold, said, "With a pan-European pension product, Europe will grow further together. It will be a great relief for European citizens to take their private retirement with them when they move to another country."
The German MRP said, "A pan-European pension would be the first truly European financial product for consumers. If the same rules apply to all providers, the consumer benefit from a genuine European competition among insurance companies.
"Currently, banks, insurance companies and funds apportion the unreasonably high costs amongst consumers. By increasing the choice of products and improving comparability, the costs for consumers will be reduced significantly by the pan-European pension product."
He went on, "Due to a uniform European definition, consumers are more likely to use better and cheaper products from other member states. The pan-European pension thus promotes the integration of the capital markets union.
"I welcome that the European insurance supervision (EIOPA) will take the lead in supervision of this. Yet, the PEPP is, of course, no substitute for highly cost effective models such as the public Swedish pension fund which has helped Swedish citizens to profit from the capital markets with only 10 per cent of the usual costs."
Giegold also said that the German government should discard its objections to the pan-European pension and support the proposal instead.
In the Council of financial service committee (FSC), the German government had criticised the potential interference with national security systems.
The MEP said, however, "This criticism from Berlin, regarding European progressive ideas, is an old hat. While the German Riester pension puts a financial burden on consumers, the pan-European pension would offer them more for less money.
"In order to make the pan-European pension a success, member states ought to promote it as much as national products."
He added, "The Greens in the European Parliament will strongly advocate for a decision to support the Commission proposal."