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EBSA Final Rules

Investment Advice--Participants and Beneficiaries   [5/22/2009]
[PDF]
FR Doc E9-12065
[Federal Register: May 22, 2009 (Volume 74, Number 98)]
[Rules and Regulations]               
[Page 23951-23952]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr22my09-5]                         

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DEPARTMENT OF LABOR

Employee Benefits Security Administration

29 CFR Part 2550

RIN 1210-AB13

 
Investment Advice--Participants and Beneficiaries

AGENCY: Employee Benefits Security Administration, Labor.

ACTION: Final rule; delay of effective date and applicability date.

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SUMMARY: This document delays the effective and applicability dates of 
final rules under the Employee Retirement Income Security Act, and 
parallel provisions of the Internal Revenue Code of 1986, relating to 
the provision of investment advice to participants and beneficiaries in 
individual account plans, such as 401(k) plans, and beneficiaries of 
individual retirement accounts (and certain similar plans). These rules 
were published in the Federal Register on January 21, 2009, and were to 
have become effective and applicable on March 23, 2009, but were 
delayed until May 22, 2009, by a final rule published on March 20, 2009 
(74 FR 11847). This document further delays the effective and 
applicability dates of these final rules from May 22, 2009, until 
November 18, 2009, to allow additional time for the Department to 
evaluate questions of law and policy concerning the rules.

DATES: The effective and applicability date of the rule amending 29 CFR 
part 2550, published January 21, 2009, at 74 FR 3822, delayed March 20, 
2009, at 74 FR 11847 is further delayed until November 18, 2009.

FOR FURTHER INFORMATION CONTACT: Fred Wong, Office of Regulations and 
Interpretations, Employee Benefits Security Administration (EBSA), 
(202) 693-8500. This is not a toll-free number.

SUPPLEMENTARY INFORMATION: On January 21, 2009, the Department of Labor 
published final rules on the

[[Page 23952]]

provision of investment advice to participants and beneficiaries of 
participant-directed individual account plans and to beneficiaries of 
individual retirement accounts (74 FR 3822). The rules contain 
regulations implementing a statutory prohibited transaction exemption 
under ERISA Section 408(b)(14) and Section 408(g) and an administrative 
class exemption granting additional relief. As published, these rules 
were to be effective on March 23, 2009. Paragraph (g) of Section 
2550.408g-1 provided that the rule would apply to covered transactions 
occurring on or after March 23, 2009.
    By memorandum dated January 20, 2009, Rahm Emanuel, Assistant to 
the President and Chief of Staff, directed Agency Heads to consider 
extending for 60 days the effective date of regulations that have been 
published in the Federal Register but not yet taken effect. The 
memorandum further advised that, where such regulations are extended, 
agencies should allow 30 days for interested persons to comment on 
issues of law and policy raised by the rules. In accordance with that 
memorandum, and taking into account the considerations listed in the 
Memorandum of January 21, 2009, from Peter R. Orszag, Director of the 
Office of Management and Budget, the Department published in the 
Federal Register on February 4, 2009, a document seeking comment on a 
proposed 60 day extension to the effective dates for these rules until 
May 22, 2009, and a proposed conforming amendment to the applicability 
date of Section 2550.408g-1 (74 FR 6007). The document also requested 
comment on issues of law and policy raised by the final rules. The 
Department indicated that upon completion of its review, it might 
decide to allow the rules to take effect, issue a further extension, 
withdraw the rules, or propose amendments. The comment period on the 
proposed extension ended on February 18, 2009. The comment period on 
issues of law and policy concerning the final rules ended on March 6, 
2009. In response, the Department received 27 comment letters.\1\ A 
number of these comments expressed the view that the final rules raise 
significant issues of law and policy. Among these, some expressed 
disagreement with the final rules' interpretation of the statutory 
exemption, and further questioned the adequacy of the class exemption's 
conditions in mitigating against the potential for investment adviser 
self-dealing.
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    \1\ These comments are available on the Department's Web site 
at: http://www.dol.gov/ebsa/regs/cmt-investmentadvicefinalrule.html.
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    On March 20, 2009, the Department published in the Federal Register 
a document adopting the proposed 60 day delay of the effective and 
applicability date of the final rule published on January 21, 2009, for 
agency review of questions of law and policy raised by commenters (74 
FR 11847). The Department believes that the complexity and significance 
of the issues involved justify delaying the effective and applicability 
dates of the final rule for an additional 180 days in order to afford 
the Department time for further review. Accordingly, the Department is 
adopting herein a 180 day delay of the effective and applicability date 
of the final rule published on January 21, 2009. With the adoption of 
this delay, the effective and applicability dates of the final rule 
will be November 18, 2009.

List of Subjects in 29 CFR Part 2550

    Employee benefit plans, Exemptions, Fiduciaries, Investments, 
Pensions, Prohibited transactions, Reporting and recordkeeping 
requirements, and Securities.


0
For the reasons set forth above, the publication on January 21, 2009 
(74 FR 3822), of the final rule amending 29 CFR Part 2550, is further 
amended as follows:

PART 2550--RULES AND REGULATIONS FOR FIDUCIARY RESPONSIBILITY

0
1. The authority citation for part 2550 is revised to read as follows:

    Authority: 29 U.S.C. 1135; and Secretary of Labor's Order No. 6-
2009, 74 FR 21524 (May 7, 2009). Secs. 2550.401b-1, 2550.408b-1, 
2550.408b-19, 2550.408g-1, and 2550.408g-2 also issued under sec. 
102, Reorganization Plan No. 4 of 1978, 5 U.S.C. App. Sec. 
2550.401c-1 also issued under 29 U.S.C. 1101. Sections 2550.404c-1 
and 2550.404c-5 also issued under 29 U.S.C. 1104. Sec. 2550.407c-3 
also issued under 29 U.S.C. 1107. Sec. 2550.404a-2 also issued under 
26 U.S.C. 401 note (sec. 657(c)(2), Pub. L. 107-16, 115 Stat. 38, 
136 (2001)). Sec. 2550.408b-1 also issued under 29 U.S.C. 
1108(b)(1). Sec. 2550.408b-19 also issued under sec. 611(g)(3), 
Public Law 109-280, 120 Stat. 780, 975 (2006).


Sec.  2550.408g-1  [Amended]

0
2. Section 2550.408g-1 is amended by removing the date ``May 22, 2009'' 
and adding in its place ``November 18, 2009'' in paragraph (g).

    Signed at Washington, DC, this 19th day of May 2009.
Alan D. Lebowitz,
Deputy Assistant Secretary for Program Operations, Employee Benefits 
Security Administration, Department of Labor.
[FR Doc. E9-12065 Filed 5-21-09; 8:45 am]

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