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October 25, 2016 at 08:36 AM
The Department of Labor plans to start rolling out “very soon” its frequently-asked-questions guidance on its fiduciary rule, Phyllis Borzi, assistant secretary of Labor for DOL’s Employee Benefits Security Administration, said Tuesday.
The first “wave” of FAQs will answer a “couple dozen” questions on the rule’s exemptions, including the best interest contract exemption, Borzi told reporters after her remarks during a panel discussion at the American Society of Pension Professionals and Actuaries national conference in National Harbor, Maryland, just outside Washington.
Borzi said that EBSA anticipates releasing the FAQs in “three waves,” but said that EBSA “may decide to break it up” into more than three. “There will be multiple waves” of FAQs, adding that they all won’t come this year.
(Related: 5 Big Changes Advisors Should Make by Fiduciary Rule Deadline)
She declined to offer more specifics regarding the first set of FAQs beyond stating that it focuses on the rule’s exemptions. While she said the first FAQs are imminent, she said “they’re not through clearance yet.”
Lawyers have warned recently that broker-dealers and advisors should not expect major revisions or reversals in the FAQs, just clarifications.
In the face of the impending litigation against the rule, Labor “will be particularly sensitive to reversing course in any way,” noted Josh Waldbeser, associate at Drinker Biddle & Reath, during a recent ThinkAdvisor webcast. DOL “will be sensitive to changing the meaning of the regulation” through FAQs.
ASPPA attendees, according to Brian Graff, ASPPA’s CEO, are “hoping that the fiduciary rule is limited in its application to TPAs [third-party administrators] and recordkeepers.”
April 2017 is the date for complying with the “basic core fiduciary” aspects of DOL’s rule, Timothy Hauser, EBSA’s chief operating officer, said at the recent FPA annual conference, while January 2018 is when firms must “get into full compliance if they’re going to rely on the contract exemptions.”
