The final regulations represent the last step in a process that the DOL began in Abstract: (b)2 Provider Disclosures have created confusion for employers. This document contains a final regulation under the Employee Retirement Income Security Act of (ERISA or the Act) requiring that certain. This bulletin discusses the impact of the U.S. Department of Labor’s (DOL) final (b)(2) disclosure regulation on discretionary investment managers – that is.

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Prior to the expiration of A’s first contract with P, A persuades E to cause P to renew A’s contract with P to provide the same services for additional fees in view of the increased costs in providing such services.

Under such circumstances, C has engaged in an act described in section b 1 of the Act as well as sections b 2 and 3 of the Act because C is in fact exercising the authority, control or responsibility which makes C a fiduciary to cause the plan to purchase the policy.

These existing exemptions generally permit fiduciaries to receive compensation or other benefits as a result of the use of their fiduciary authority, control or responsibility in connection with investment transactions involving plans or IRAs.

29 CFR 2550.408b-2 – General statutory exemption for services or office space.

F The notice required by paragraph c 1 ix C of this section shall be furnished to the U. The examination also includes the new and amended administrative class exemptions from the prohibited transaction provisions of ERISA and the Code that were published in conjunction with the Rule collectively, the Prohibited Transaction Exemptions or PTEs.

Disclosing Changes Under the b 2 Regulations Abstract: The exemption 480b2 entities such as registered investment advisers, broker-dealers 4408b2 insurance companies, and their agents and representatives, that are ERISA or Code fiduciaries by reason of the provision of investment advice, to receive compensation that may otherwise give rise to prohibited transactions as a result of their advice to plan participants and beneficiaries, IRA owners and certain plan fiduciaries including small plan sponsors.

The ERISA and Code provisions at issue generally reuglations fiduciaries with respect to employee benefit reuglations and individual retirement accounts IRAs from engaging in self-dealing in connection with transactions involving plans and IRAs. This document contains the full text of the final regulation regulafions ERISA requiring that certain service providers to pension plans disclose information about the service providers’ compensation and potential conflicts of interest.


For example, a minimal fee in a service contract which is charged to allow recoupment of reasonable start-up costs is not a penalty. E The notice shall be filed with the Department not later than 30 days following the earlier of. This final rule establishes specific disclosure obligations for plan service providers to ensure that responsible plan fiduciaries are provided the information they need to make better decisions when selecting and monitoring service providers for their plans.

The b 2 Fiduciary Conundrums: For purposes of paragraph c 1 of this section:. The provision of such services is arranged by I and approved on behalf of regulatioms plan by E.

DOLs (b) Final Fee Disclosure Rule –

G If the covered service provider fails to comply with the written request referred to in paragraph c 1 ix C of this section within 90 days of such request, the responsible plan fiduciary shall determine whether to terminate or continue the contract or arrangement consistent with its duty of prudence under section of the Act. Here is a list of issues related to these products under b 2.

For more information, see Applicability Date, below. The Department of Labor has already added a question to their audit checklist asking plan sponsors for all their b 2 disclosures. The primary purpose of the amendments is to give the Department of Labor the time necessary to consider public comments under the criteria set forth in the Presidential Memorandum of February 3,including whether possible changes and alternatives to these exemptions would be appropriate in light of the current comment record and potential input from, and action by, the Securities and Exchange Commission and state insurance commissioners.

Impact on Investment Managers Abstract: T physically absents himself from all consideration of B’s proposal and does not otherwise exercise any of the authority, control or responsibility which makes T a fiduciary to cause the plan to retain B.


The final rule is effective June 7, As fiduciaries, plan sponsors are responsible for making decisions related to selecting an appropriate fee structure. Summary This document contains proposed amendments to three regulations previously published under the Employee Retirement Income Security Act of that facilitate the termination of, and distribution of benefits from, individual account pension plans that have been abandoned by their sponsoring employers.

Summary This document corrects two errors in the preamble of a document that appeared in the Federal Register on November 29, We request comment below on whether the applicability date of certain conditions should be delayed. All covered service providers including advisors will be required to provide a responsible plan fiduciary with a written description of their services rendered for compensation received by July 1, So, what can financial professionals do to prepare for and make the best of this on-going requirement?

Fred Reish shares some thoughts on the process. Impact of b 2 Guide on b Advisors.

They have a number of moving pieces which can make them a challenge to review for b 2 purposes. Assume the same finzl as in Example 2 except that the nature of C’s relationship with the plan is not such that C is a fiduciary of P. It shows procedural discipline with regard to reviewing plan fees.

Summary This document contains a proposed amendment to the final regulation under the Employee Retirement Income Security Act of ERISA or the Act requiring that certain service providers to pension plans disclose information about the service providers’ compensation and potential conflicts of interest. For further information, see Applicability Date, below. The corrections in this document fix typographical errors, flnal minor clarifications to provisions that might otherwise be confusing, and confirm insurers’ broad eligibility to rely on the exemption, consistent with the exemption’s clearly intended scope and the analysis and data relied upon in the Department’s final regulatory impact analysis RIA.