DOL Files Applicability Extension Proposal with OMB

While you were reading the House GOP’s tax reform proposal, the Labor Department filed a rule with the Office of Management and Budget (OMB) for the official 18-month delay of its fiduciary rule.

The Labor Department had published a proposal in the Federal Register in late August to “extend the special transition period under sections II and IX of the Best Interest Contract Exemption and section VII of the Class Exemption for Principal Transactions in Certain Assets Between Investment Advice Fiduciaries and Employee Benefit Plans and IRAs,” as well as “the applicability of certain amendments to Prohibited Transaction Exemption 84-24 for the same period.” At the time, the Labor Department had said that the primary purpose of these proposed amendments is “to give the Department of Labor the time necessary to consider possible changes and alternatives to these exemptions.”

The present transition period is, of course, from June 9, 2017, to Jan. 1, 2018. The new transition period would end on July 1, 2019. The proposal includes a 15-day comment period.

The rule, which must be approved by OMB, pushes the applicability date of the fiduciary rule’s Best Interest Contract Exemption (BICE) from Jan. 1, 2018, until July 1, 2019.

The rule is titled “18-Month Extension of Transition Period and Delay of Applicability Dates; Best Interest Contract Exemption; Class Exemption for Principal Transactions; PTE 84-24.”

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