The Investment Company Institute has requested a meeting with a chief administrator at the Office of Management and Budget regarding the Department of Labor’s regulatory impact analysis of its proposed fiduciary rule.
That request comes as OMB is likely entering the final stages of its review of the DOL proposal.
Some predict OMB will release the rule as early as the second week in March; most are calling for a release by the end of March.
The DOL’s rule intends to redefine who a fiduciary is as it relates to advisors to most of the country’s defined contribution plans, and all advisors to IRA owners.
The regulatory impact analysis the DOL provided as part of its proposal does not justify the “massive overhaul of the retirement marketplace that the rule as proposed would impose,” according to the letter ICI sent OMB requesting a final meeting.
The ICI, which represents the interests of mutual funds and investment managers, and other stakeholders have previously made public their concerns over DOL’s regulatory impact analysis in comment letters posted to the DOL.
But this time the ICI’s letter brings specific attention to Executive Order 12866, and does so as Republican Senate staffers have produced a report suggesting the DOL willfully ignored recommendations from the Securities and Exchange Commission to conduct a more thorough cost-benefit analysis of the proposal.
That report, produced by the majority staff to the Committee on Homeland Security and Governmental Affairs, also notes Executive Order 12866, which was issued by President Clinton in 1993, as well as Executive Order 13563, which was issued by President Obama in 2011.
Executive Order 12866 says regulators “shall assess both the costs and the benefits of the intended regulation” and that a regulation be adopted “only upon a reasoned determination that the benefits of the intended regulation justify its costs,” according to a copy of the order.
President Obama’s executive order is said to reaffirm the principals created in EO 12866, according to a summary of the orders by the Environmental Protection Agency.
EO 12866 also requires regulators to identify “available alternatives” to proposed regulation.
In the Republican staffers’ report, communications between regulators reveal that SEC staff urged DOL to “consider quantifying the costs and benefits of all the alternative approaches we considered and rejected,” the report says.