OMB files this comment in accordance with 5 CFR 1320.11( c ). This OMB action is not an approval to conduct or sponsor an information collection under the Paperwork Reduction Act of 1995. This action has no effect on any current approvals. If OMB has assigned this ICR a new OMB Control Number, the OMB Control Number will not appear in the active inventory. For future submissions of this information collection, reference the OMB Control Number provided. The agency will respond to comments received on the ICR in the final rule.
table that charts list comparision
Inventory as of this Action
Requested
Previously Approved
36 Months From Approved
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0
0
0
0
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0
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0
The Department is proposing this prohibited transaction class exemption (PTE) in connection with its proposed regulation under ERISA section 3(21)(A)(ii) and Code section 4975(e)(3)(B) (Proposed Regulation). The Proposed Regulation would amend the definition of a "fiduciary" under ERISA and the Code to specify when a person is a fiduciary by reason of the provision of investment advice for a fee or other compensation regarding assets of a plan or IRA (i.e., an investment advice fiduciary). If adopted, the Proposed Regulation would replace an existing regulation dating to 1975, with the aim of more appropriately distinguishing between the sorts of advice relationships that should be treated as fiduciary in nature and those that should not.
The proposed exemption would allow an individual investment advice fiduciary (an adviser) and the firm that employs or otherwise contracts with the adviser (a financial institution) to engage in principal transactions involving certain debt securities with plans and IRAs. The proposed exemption limits the type of debt securities that may be purchased or sold and contains conditions which the adviser and financial institution must satisfy in order to rely on the exemption. To safeguard the interests of plans and IRAs, the exemption would require the adviser and financial institution to contractually acknowledge fiduciary status and commit to adhere to certain impartial conduct standards when providing advice to the plan or IRA, including providing advice that is in the plan's or IRA's Best Interest. The financial institution would further be required to warrant that it has adopted policies and procedures designed to mitigate the impact of conflicts of interest and ensure that the individual advisers adhere to the impartial conduct standards. The plan or IRA would be required to consent to the principal transactions following disclosure of the conflicts of interest associated with such transactions. Additional disclosure of the mark-up or mark-down applied to the prevailing market price of the security would be required and financial institutions would be subject to recordkeeping requirements.
US Code:
29 USC 1108
Name of Law: Employee Retirement Income Security Act
The Department is proposing this prohibited transaction class exemption (PTE) in connection with its proposed regulation under ERISA section 3(21)(A)(ii) and Code section 4975(e)(3)(B) (Proposed Regulation). The Proposed Regulation would amend the definition of a "fiduciary" under ERISA and the Code to specify when a person is a fiduciary by reason of the provision of investment advice for a fee or other compensation regarding assets of a plan or IRA (i.e., an investment advice fiduciary). If adopted, the Proposed Regulation would replace an existing regulation dating to 1975, with the aim of more appropriately distinguishing between the sorts of advice relationships that should be treated as fiduciary in nature and those that should not.
The proposed exemption would allow an individual investment advice fiduciary (an adviser) and the firm that employs or otherwise contracts with the adviser (a financial institution) to engage in principal transactions involving certain debt securities with plans and IRAs. The proposed exemption limits the type of debt securities that may be purchased or sold and contains conditions which the adviser and financial institution must satisfy in order to rely on the exemption. To safeguard the interests of plans and IRAs, the exemption would require the adviser and financial institution to contractually acknowledge fiduciary status and commit to adhere to certain impartial conduct standards when providing advice to the plan or IRA, including providing advice that is in the plan's or IRA's Best Interest. The financial institution would further be required to warrant that it has adopted policies and procedures designed to mitigate the impact of conflicts of interest and ensure that the individual advisers adhere to the impartial conduct standards. The plan or IRA would be required to consent to the principal transactions following disclosure of the conflicts of interest associated with such transactions. Additional disclosure of the mark-up or mark-down applied to the prevailing market price of the security would be required and financial institutions would be subject to recordkeeping requirements.
No
No
No
No
No
Uncollected
Chris Cosby 202 693-8540
Reginfo record details
No
On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).
The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:
(i) Why the information is being collected;
(ii) Use of information;
(iii) Burden estimate;
(iv) Nature of response (voluntary, required for a benefit, or mandatory);
(v) Nature and extent of confidentiality; and
(vi) Need to display currently valid OMB control number;
If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.
Principal Transactions Exemption Supporting Statementfinal.docx
Conditions of Proposed Principal Transactions PTE