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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Billions of dollars in what I call spread based fees remain undisclosed under the new US Department of Labor fee disclosure rules. Any description, including any estimate of recordkeeping cost under paragraph c 1 iv Dmust contain sufficient information to permit evaluation of the reasonableness of the compensation or cost.

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.

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. This rule is effective June 17,without further action or notice, unless significant adverse comment is received by April 20, The regulations raise several important questions for plan sponsors and service providers that should be considered in order to implement finak systems.

E, an employer whose employees are covered by plan Eegulations, is a fiduciary of P. The Department of Labor finally issued long-anticipated final regulations requiring retirement-plan service providers to disclose to employer-plan sponsors all of their direct and indirect compensation and potential conflicts of interest.

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

The Department is granting the delay because of its concern that, without a delay in the applicability dates, consumers may face significant confusion, and regulated parties may incur undue expense to comply with conditions or requirements that the Department ultimately determines to revise or repeal.

Through these arrangements, plan participants may be able to choose among the full range of investment options available in the investment marketplace.

For those that didn’t, the Final b 2 Fee Disclosure Regulations require responsible plan fiduciaries to file a notice with the Dept. Get tips to help show your clients the value of the important services you provide.


So, what can financial professionals do to prepare for and make the best of this on-going requirement? Summary This document contains a notice of pendency before the U. The hearing will be held on August 10, 11, and 12, and continuing through August 13, if necessary beginning each day at 9 a.

The Best Interest Contract Exemption, as corrected herein, is applicable to transactions occurring on or after April 10, Consider the following three advisor scenarios. To subscribe to our free weekly newsletter, enter your email address regulaitons then click the “Join” button. See paragraph f of this section.

In this 18 page comment letter, the Investment Company Institute expresses concern regarding the timing of the focus groups, 480b2 ICR design, and specific issues relating to the proposed focus group script. D, a trustee of plan P with discretion over the management and disposition of plan assets, relies on the advice of C, a consultant to P, as to the investment of plan assets, thereby making C a fiduciary of the plan. Recordkeeping services or brokerage services provided to a covered plan that is an individual account plan, as defined in section 3 34 of the Act, and that permits participants or beneficiaries to direct the investment of their accounts, if one or more designated investment alternatives will be made available e.

The Department will not institute a second comment period on this rule. The corrections either fix typographical errors fknal make minor clarifications to provisions that might otherwise be confusing.

C Designated investment alternative. Internal Revenue Code of T, one of the trustees of plan P, is president of bank B. This is a FAQ to assist service providers in navigating the new world of fee disclosure. As amended, the regulation provides plan administrators with flexibility as to when they must furnish annual disclosures to participants and beneficiaries. These amendments and partial revocations are issued June regulstions, The New Fiduciary Paradox.

See, for example, section of the Internal Revenue Code finaal This document contains a regualtions 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.

This document contains a notice of pendency before the Department of Labor of proposed amendments to prohibited transaction exemptions PTEs, and The proposed amendments would require the fiduciaries to satisfy uniform Impartial Conduct Standards in order to obtain the relief available under each exemption. This amendment is applicable to transactions occurring on or after April 10, This document contains a notice of pendency before the Department of Labor of a proposed class exemption from certain regulationss transaction rrgulations of the Employee Retirement Income Security Act ofas amended ERISAand the Internal Revenue Code ofas amended the Code.


The disclosures related to b 2 are really just a precursor to the regulattions step: Without regard to the disclosure of compensation pursuant to paragraph c 1 iv Cc 1 iv Eor c 1 iv F of this section, if recordkeeping services will be provided to the covered plan. No contract or arrangement will fail to be reasonable under this paragraph c 1 solely because the covered service provider, acting in good faith and with reasonable diligence, makes an error or omission in disclosing the information required pursuant to paragraph c 1 iv of this section or a change to such information disclosed pursuant to paragraph c 1 v B of this section or paragraph c 1 vi of this section, provided that the rehulations service provider discloses the correct information to the responsible plan fiduciary as soon as practicable, reglations not later than 30 days from the date on which the covered service provider knows of such error or omission.

In this article, Fred Reish and Bruce Ashton describe what the amendment says and what they think are the most important changes. This article helps explain the investment disclosure requirements.

C Other services for indirect compensation. Nothing in this section shall be construed to supersede any provision of State law that governs disclosures by parties that provide the services described in this section, except to the extent that such law prevents the application of a requirement of this section.

The regs under b 2 never really addresses cinal sort of inherent conflict.

DOLs (b) Final Fee Disclosure Rule –

The DOL recently issued a proposal to require a b 2 guide. Investment Advisers Act of Such a provision does not reasonably compensate for loss if it provides for payment in excess of actual loss or if it fails to require mitigation of damages.

Summary Notice is hereby regulwtions that the Employee Benefits Security Administration EBSA will hold a public hearing fiinal August 10, 11, and 12, and continuing through August 13, if necessary to consider issues attendant to adopting a regulation concerning its proposed conflict of interest rule and related proposed prohibited transaction exemptions.