Retirement Plans Newsletter

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[Official Guidance]

Text of DOL FAQs: Application of Fiduciary Rule Starting June 9 (PDF)
15 questions and answers, including: "When do firms and their advisers have to comply with the conditions of the new Best Interest Contract (BIC) Exemption and the [Principal Transactions Exemption]? ... When do parties have to comply with the new conditions in PTE 84-24, which was amended in connection with the Fiduciary Rule? ... When do firms and their advisers have to comply with the new conditions in other pre-existing exemptions that were amended in connection with the Fiduciary Rule? ... Will the Department make additional changes to the Fiduciary Rule or exemptions? ... Does the Department's decision to have the Fiduciary Rule and impartial conduct standards become applicable on June 9, 2017 mean it has effectively concluded its review under the President's Memorandum?.... How does the delay in the applicability dates affect the grandfathering relief in Section VII of the BIC Exemption ... Does PTE 84-24 apply to transactions involving IRAs during the transition period? ... The Department postponed the relevant applicability dates of the Fiduciary Rule and exemptions until Friday, June 9, 2017. Does this mean that advisers and financial institutions must be in full compliance before the close of business on June 9, 2017?"
Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

[Official Guidance]

Text of DOL FAB 2017-02: Temporary Enforcement Policy on Fiduciary Rule
"The Department is actively engaging in a careful analysis of the issues raised in the President's Memorandum. It is possible, based on the results of the examination, that additional changes will be proposed to the fiduciary duty rule and PTEs. The Department also intends to issue a Request for Information (RFI) in the near future seeking additional public input on specific ideas for possible new exemptions or regulatory changes ... The Department has repeatedly said that its general approach to implementation will be marked by an emphasis on assisting (rather than citing violations and imposing penalties on) plans, plan fiduciaries, financial institutions, and others who are working diligently and in good faith to understand and come into compliance with the fiduciary duty rule and exemptions.... Accordingly, during the phased implementation period ending on January 1, 2018, the Department will not pursue claims against fiduciaries who are working diligently and in good faith to comply with the fiduciary duty rule and exemptions, or treat those fiduciaries as being in violation of the fiduciary duty rule and exemptions."
Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]

[Guidance Overview]

Acosta on Fiduciary Rule's June 9 Implementation: 'Deregulators' Must Follow the Law, So Regulators Will Too
"The [DOL] has concluded that it is necessary to seek additional public input on the entire Fiduciary Rule, and we will do so. We recognize that the rule goes into partial effect on June 9, with full implementation on Jan. 1, 2018.... We have carefully considered the record in this case, and the requirements of the Administrative Procedure Act, and have found no principled legal basis to change the June 9 date while we seek public input. Respect for the rule of law leads us to the conclusion that this date cannot be postponed. Trust in Americans' ability to decide what is best for them and their families leads us to the conclusion that we should seek public comment on how to revise this rule. Under the Obama administration, the [SEC] declined to move forward in rule-making. Yet the SEC has critical expertise in this area. I hope in this administration the SEC will be a full participant."
Secretary of Labor Alexander Acosta, via The Wall Street Journal; subscription may be required

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