Prohibited Transaction Class Exemption for Principal Transactions

Forms and Documents

Document Name	Status
Justification for Nonmaterial Nonsubstantive Change to OCIO.docx Supporting Statement A	2016-07-08
Justification for Nonmaterial Nonsubstantive Change to OCIO.docx Justification for No Material/Nonsubstantive Change	2016-07-08
PTTechCor.docx Supplementary Document	2016-07-06
Regulatory Impact Analysis (Website).pdf Supplementary Document	2016-04-06

IC Document Collections

IC ID	Document Title	Status
213824	Conditions of Principal Transactions PTE Other-null	Modified

ICR Details

OMB Control No: 1210-0157	ICR Reference No: 201607-1210-003
Status: Historical Active	Previous ICR Reference No: 201603-1210-003
Agency/Subagency: DOL/EBSA	Agency Tracking No:
Title: Prohibited Transaction Class Exemption for Principal Transactions
Type of Information Collection: No material or nonsubstantive change to a currently approved collection	Common Form ICR:  No
Type of Review Request: Regular
OIRA Conclusion Action: Approved without change	Conclusion Date: 09/08/2016
	Date Received in OIRA: 07/11/2016
Terms of Clearance:

	Inventory as of this Action	Requested	Previously Approved
Expiration Date	06/30/2019	06/30/2019	06/30/2019
Responses	3,700,000	0	3,700,000
Time Burden (Hours)	66,000	0	66,000
Cost Burden (Dollars)	939,700,000	0	939,700,000

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Abstract: The Department is granting this prohibited transaction class exemption (PTE) in connection with its regulation under ERISA section 3(21)(A)(ii) and Code section 4975(e)(3)(B). The Regulation amends 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). The Regulation replaces 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. The Department is issuing technical corrections to its final Principal Transactions Exemption which was published in the Federal Register on April 8, 2016 (81 FR 21089). All of the corrections either fix typographical errors or make minor clarifications to provisions that might otherwise be confusing.

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Authorizing Statute(s): US Code: 29 USC 1108 Name of Law: Employee Retirement Income Security Act
  

Citations for New Statutory Requirements: None

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Associated Rulemaking Information
RIN:	Stage of Rulemaking:	Federal Register Citation:	Date:
1210-ZA25	Final or interim final rulemaking	81 FR 21089	04/08/2016

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Federal Register Notices & Comments
60-day Notice:	Federal Register Citation:	Citation Date:
	80 FR 21989	04/20/2015
30-day Notice:	Federal Register Citation:	Citation Date:
	80 FR 21898	04/20/2015
Did the Agency receive public comments on this ICR? Yes

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Number of Information Collection (IC) in this ICR: 1

IC Title	Form No.	Form Name
Conditions of Principal Transactions PTE

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ICR Summary of Burden

	Total Approved	Previously Approved	Change Due to New Statute	Change Due to Agency Discretion	Change Due to Adjustment in Estimate	Change Due to Potential Violation of the PRA
Annual Number of Responses	3,700,000	3,700,000	0	0	0	0
Annual Time Burden (Hours)	66,000	66,000	0	0	0	0
Annual Cost Burden (Dollars)	939,700,000	939,700,000	0	0	0	0

Burden increases because of Program Change due to Agency Discretion: No

Burden Increase Due to:

Burden decreases because of Program Change due to Agency Discretion: No

Burden Reduction Due to:

Short Statement:

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Annual Cost to Federal Government:

Does this IC contain surveys, censuses, or employ statistical methods? No

Is the Supporting Statement intended to be a Privacy Impact Assessment required by the E-Government Act of 2002? No

Is this ICR related to the Affordable Care Act [Pub. L. 111-148 & 111-152]? No

Is this ICR related to the Dodd-Frank Wall Street Reform and Consumer Protection Act, [Pub. L. 111-203]? No

Is this ICR related to the American Recovery and Reinvestment Act of 2009 (ARRA)? No

Is this ICR related to the Pandemic Response? Uncollected

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Common Form ICR:  No

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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:

(a) It is necessary for the proper performance of agency functions;

(b) It avoids unnecessary duplication;

(c) It reduces burden on small entities;

(d) It uses plain, coherent, and unambiguous language that is understandable to respondents;

(e) Its implementation will be consistent and compatible with current reporting and recordkeeping practices;

(f) It indicates the retention periods for recordkeeping requirements;

(g) It informs respondents of the information called for under 5 CFR 1320.8 (b)(3) about:

(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;

(h) It was developed by an office that has planned and allocated resources for the efficient and effective management and use of the information to be collected.

(i) It uses effective and efficient statistical survey methodology (if applicable); and

(j) It makes appropriate use of information technology.

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.

Certification Date: 07/11/2016

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