The Department of Labor on Wednesday released a proposed rule to extend for 60 days the applicability date of its fiduciary rule under the Employee Retirement Income Security Act.
The proposal, which includes a 15-day comment period, would extend the rule’s April 10 compliance date to June 9.
Labor said that it invites comments on the proposal to extend the applicability date of the final rule as well as the prohibited transaction exemptions and the Best Interest Contract Exemption.
Fred Reish, partner in Drinker Biddle & Reath's employee benefits and executive compensation practice group in Los Angeles, notes that a 6-month delay had been widely expected.
"During the shortened period, the DOL will take comments for 15 days on whether the proposed rule should be finalized and will take comments for 45 days on a list of questions about the impact of the fiduciary regulation and the exemptions," Reish explains.
After the comments are received and reviewed, Labor will then issue a final rule extending the applicability date to June 9, Reish adds. "Once drafted, it will be sent to the Office of Management and Budget for another review. The goal is obviously to get the final rule on the extension of the applicability date approved and published by April 10. We expect that to happen at the end of March or early April."
The U.S. Chamber of Commerce said in a Wednesday statement that it "commends the Department of Labor for its swift action to protect retirement savers by issuing a notice of proposed rulemaking to delay the fiduciary rule, which will help ensure all Americans have access to the advice and choices needed when saving for their future."
Chamber, which is among the nine plaintiffs suing Labor over its fiduciary rule in a Texas court, is appealing Judge Barbara M.G. Lynn’s Feb. 8 decision upholding Labor’s rule. Chamber said Wednesday that its “goal is to strengthen our nation’s retirement system so it meets the retirement needs of small-business owners, employees and retirement savers. Now, we look forward to working with the administration and Congress on policy that achieves this shared objective.”
The Office of Management and Budget said Monday that it had finished its review of Labor’s request to delay implementation of the rule.
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