ERISA Procedure 76-1; Advisory Opinion Procedure

Employee Retirement Income Security Act Procedure 1976-1; Advisory Opinion Procedure

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ERISA Procedure 76-1; Advisory Opinion Procedure

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ERISA Procedure 76-1 For Filing ERISA Advisory Opinions Employee Benefits 
      Security Administration 
      April 30, 2009    Find It! | A to Z Index | Search: All DOLEBSA     

      DOL > EBSA > Laws and Regulations > Filing Requests For ERISA Advisory 
      Opinions 
                  Filing Requests For ERISA Advisory Opinions
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                  ERISA Procedure 76-1 For ERISA Advisory Opinions 
                  It is the practice of the Department of Labor to answer 
                  inquiries of individuals or organizations affected, directly 
                  or indirectly, by the Employee Retirement Income Security Act 
                  of 1974 (Pub. L. 93-406, hereinafter the Act) as to their 
                  status under the Act and as to the effect of certain acts and 
                  transactions. The answers to such inquiries are categorized as 
                  information letters and advisory opinions.  This ERISA 
                  procedure describes the general procedures of the department 
                  in issuing information letters and advisory opinions under the 
                  Act, and is designed to promote efficient handling of 
                  inquiries and to facilitate prompt responses. 
                  Section 7 of this procedure is reserved and will set forth the 
                  procedures to be followed to obtain an advisory opinion 
                  relating to prohibited transactions and common definitions, 
                  such as whether a person is a party in interest and a 
                  disqualified person. In general, this section will incorporate 
                  a revenue procedure to be published by the Internal Revenue 
                  Service. 
                  Section 1. Purpose 
                  The purpose of this ERISA Procedure is to describe the general 
                  procedures of the Department of Labor in issuing information 
                  letters and advisory opinions to individuals and organizations 
                  under the Employee Retirement Income Security Act of 1974 
                  (Pub. L. 93-406), hereinafter referred to as the Act. This 
                  ERISA Procedure also informs individuals and organizations, 
                  and their authorized representatives, where they may direct 
                  requests for information letters and advisory opinions, and 
                  outlines procedures to be followed in order to promote 
                  efficient handling of their inquiries. 
                  Section 2. General Practice 
                  It is the practice of the department to answer inquiries of 
                  individuals and organizations, whenever appropriate, and in 
                  the interest of sound administration of the Act, as to their 
                  status under the Act and as to the effects of their acts or 
                  transactions. One of the functions of the department is to 
                  issue information letters and advisory opinions in such 
                  matters. 
                  Section 3. Definitions 
                  .01 An information letter is a written statement issued either 
                  by the Pension and Welfare Benefit Programs (Office of 
                  Employee Benefits Security), U.S. Department of Labor, 
                  Washington, D.C. or a Regional Office or an Area Office of the 
                  Labor-Management Services Administration, U.S. Department of 
                  Labor, that does no more than call attention to a 
                  well-established interpretation or principle of the Act, 
                  without applying it to a specific factual situation. An 
                  information letter may be issued to any individual or 
                  organization when the nature of the request from the 
                  individual or the organization suggests that it is seeking 
                  general information, or where the request does not meet all 
                  the requirements of section 6 or section 7 of this procedure, 
                  and it is believed that such general information will assist 
                  the individual or organization. 
                  .02 An advisory opinion is a written statement issued to an 
                  individual or organization, or to the authorized 
                  representative of such individual or organization, by the 
                  Administrator of Pension and Welfare Benefit Programs or his 
                  delegate, that interprets and applies the Act to a specific 
                  factual situation. Advisory opinions are issued only by the 
                  Administrator of Pension and Welfare Benefit Programs or his 
                  delegate. 
                  .03 Individuals and organizations are those persons described 
                  in section 4 of this procedure. 
                  Section 4. Individuals and Organizations Who May Request 
                  Advisory Opinions or Information Letters 
                  .01 Any individual or organization affected directly or 
                  indirectly, by the Act may request an information letter or an 
                  advisory opinion from the department. 
                  .02 A request by or for an individual or organization must be 
                  signed by the individual or organization, or by the authorized 
                  representative of such individual or organization. See section 
                  7.03 of this procedure. 
                  Section 5. Discretionary Authority to Render Advisory Opinions 

                  .01 The department will issue advisory opinions involving the 
                  interpretation of the application of one or more sections of 
                  the Act, regulations promulgated under the Act, interpretive 
                  bulletins, or exemptions issued by the department to a 
                  specific factual situation. Generally, advisory opinions will 
                  be issued by the department only with respect to prospective 
                  transactions (i.e., a transaction which will be entered into). 
                  Moreover, there are certain areas where, because of the 
                  inherently factual nature of the problem involved, or because 
                  the subject of the request for opinion is under investigation 
                  for a violation of the Act, the department ordinarily will not 
                  issue advisory opinions. Generally, an advisory opinion will 
                  not be issued on alternative courses of proposed transactions, 
                  or on hypothetical situations, or where all parties involved 
                  are not sufficiently identified and described, or where 
                  material facts or details of the transaction are omitted. 
                  .02 The department ordinarily will not issue advisory opinions 
                  relating to the following sections of the Act: 
                    .02(a) Section 3(18), relating to whether certain 
                    consideration constitutes adequate consideration 
                    .02(b) Section 3(26), relating to whether the valuation of 
                    any asset is at current value 
                    .02(c) Section 3(27), relating to whether the valuation of 
                    any asset is at present value 
                    .02(d) Section 102(a)(1), relating to whether a summary plan 
                    description is written in a manner calculated to be 
                    understood by the average participant 
                    .02(e) Section 103(a)(3)(A), relating to whether the 
                    financial statements and schedules required to be included 
                    in the Annual Report are presented fairly in conformity with 
                    generally accepted accounting principles applied on a 
                    consistent basis 
                    .02(f) Section 103(b)(1), relating to whether a matter must 
                    be included in a financial statement in order to fully and 
                    fairly present the financial statement of the plan 
                    .02(g) Section 202 (other than section 202(a)(3) and (b)(1)) 
                    relating to minimum participation standards 
                    .02(h) Section 203 (other than sections 202(a)(3)(B), (b)(1) 
                    (flush language), (b)(2), (b)(3)(A) 
                    .02(i) Section 204 of the Act (other than sections 
                    204(b)(1)(B), (b)(1)(A), (C), (D), (E)), relating to benefit 
                    accrual requirements 
                    .02(j) Section 205(e), relating to the period during which a 
                    participant may elect in writing not to receive a joint and 
                    survivor annuity 
                    .02(k) Section 208, relating to mergers and consolidation of 
                    plans or transfer of plan assets 
                    .02(l) Section 209(a)(1), relating to whether the report 
                    required by section 209(a)(1) is sufficient to inform the 
                    employee of his accrued benefits under the plan, etc. 
                    .02(m) Sections 302 through 305, relating to minimum funding 
                    standards 
                    .02(n) Section 403(c)(1), relating to the purposes for which 
                    plan assets must be held 
                    .02(o) Section 404(a), relating to fiduciary duties as 
                    applied to particular conduct 
                    .02(p) Section 407(a)(2) and (3) and (c)(1), relating to 
                    fair market value, as applied to whether the value of any 
                    particular security or real property constitutes fair market 
                    value 
                  This list is not all inclusive and the department may decline 
                  to issue advisory opinions relating to other sections of the 
                  Act whenever warranted by the facts and circumstances of a 
                  particular case. The department may, when it is deemed 
                  appropriate and in the best interest of sound administration 
                  of the Act, issue information letters calling attention to 
                  established principles under the Act, even though the request 
                  that was submitted was for an advisory opinion. 
                  .03 Pending the adoption of regulations (either temporary or 
                  final) involving the interpretation of the application of a 
                  provision of the Act, consideration will be given to the 
                  issuance of advisory opinions relating to such provisions of 
                  the Act only under the following conditions: 
                    .03(a) If an inquiry presents an issue on which the answer 
                    seems to be clear from the application of the provisions of 
                    the Act to the facts described, the advisory opinion will be 
                    issued in accordance with the procedures contained herein. 
                    .03(b) If an inquiry presents an issue on which the answer 
                    seems reasonably certain but not entirely free from doubt, 
                    an advisory opinion will be issued only if it is established 
                    to the satisfaction of the department, that a business 
                    emergency requires an advisory opinion or that unusual 
                    hardship to the plan or its participants and beneficiaries 
                    will result from failure to obtain an advisory opinion. In 
                    any case in which the individual or organization believes 
                    that a business emergency exists or that an unusual hardship 
                    to the plan or its participants and beneficiaries will 
                    result from the failure to obtain an advisory opinion, the 
                    individual or organization should submit with the request a 
                    separate letter setting forth the facts necessary for the 
                    department to make a determination in this regard. In this 
                    connection, the department will not deem a business 
                    emergency to result from circumstances within the control of 
                    the individual or organization such as, for example, 
                    scheduling within an inordinately short time the closing 
                    date of a transaction or a meeting of the Board of Directors 
                    or the shareholders of a corporation. 
                    .03(c) If an inquiry presents an issue that cannot be 
                    reasonably resolved prior to the issuance of a regulation, 
                    an advisory opinion will not be issued. 
                  .04 The department ordinarily will not issue advisory opinions 
                  on the form or effect in operation of a plan, fund, or program 
                  (or a particular provision or provisions thereof) subject to 
                  Title I of the Act. For example, the department will not issue 
                  an advisory opinion on whether a plan satisfies the 
                  requirements of Parts 2 and 3 of Title I of the Act. 
                  Section 6. Instructions To Individuals and Organizations 
                  Requesting Advisory Opinions From the Department 
                  .01 If an advisory opinion is desired, a request should be 
                  submitted to: 
                    U.S. Department of Labor
                    Employee Benefits Security Administration
                    Office of Regulations and Interpretations
                    200 Constitution Avenue, NW, Suite N-5669
                    Washington, DC 20210
                  .02 A request for an advisory opinion must contain the 
                  following information: 
                    .02(a) The name and type of plan or plans (e.g., pension, 
                    profit-sharing, or welfare plan); the Employer 
                    Identification Number (EIN); the Plan Number (PN) used by 
                    the plan in reporting to the Department of Labor on Form 
                    EBS-1 or a copy of the first two pages of the most recent 
                    Form EBS-1 filed with the department. 
                    .02(b) A detailed description of the act or acts or 
                    transaction or transactions with respect to which an 
                    advisory opinion is requested. Where the request pertains to 
                    only one step of a larger integrated act or transaction, the 
                    facts, circumstances, etc., must be submitted with respect 
                    to the entire transaction. In addition, a copy of all 
                    documents submitted must be included in the individual's or 
                    organization's statement and not merely incorporated by 
                    reference, and must be accompanied by an analysis of their 
                    bearing on the issue or issues, specifying the pertinent 
                    provisions. 
                    .02(c) A discussion of the issue or issues presented by the 
                    act or acts or transaction or transactions which should be 
                    addressed in the advisory opinion. 
                    .02(d) If the individual or organization is requesting a 
                    particular advisory opinion, the requesting party must 
                    furnish an explanation of the grounds for the request, 
                    together with a statement of relevant supporting authority. 
                    Even though the individual or organization is urging no 
                    particular determination with regard to a proposed or 
                    prospective act or acts or transaction or transactions, the 
                    party requesting the ruling must state such party's views as 
                    to the results of the proposed act or acts or transaction or 
                    transactions and furnish a statement of relevant authority 
                    to support such views. 
                  .03 A request for an advisory opinion by or for an individual 
                  or organization must be signed by the individual or 
                  organization or by the individual's or organization's 
                  authorized representative. If the request is signed by a 
                  representative of an individual or organization, or the 
                  representative may appear before the department in connection 
                  with the request, the request must include a statement that 
                  the representative is authorized to represent the individual 
                  or organization. 
                  .04 A request for an advisory opinion that does not comply 
                  with all the provisions of this procedure will be 
                  acknowledged, and the requirements that have not been met will 
                  be noted. Alternatively, at the discretion of the department, 
                  the department will issue an information letter to the 
                  individual or organization. 
                  .05 If the individual or organization or the authorized 
                  representative, desires a conference in the event the 
                  department contemplates issuing an adverse advisory opinion, 
                  such desire should be stated in writing when filing the 
                  request or soon thereafter in order that the department may 
                  evaluate whether in the sole discretion of the department, a 
                  conference should be arranged and at what stage of the 
                  consideration a conference would be most helpful. 
                  .06 It is the practice of the department to process requests 
                  for information letters and advisory opinions in regular order 
                  and as expeditiously as possible. Compliance with a request 
                  for consideration of a particular matter ahead of its regular 
                  order, or by a specified time, tends to delay the disposition 
                  of other matters. Requests for processing ahead of the regular 
                  order, made in writing (submitted with the request or 
                  subsequent thereto) and showing clear need for such treatment, 
                  will be given consideration as the particular circumstances 
                  warrant. However, no assurance can be given that any letter 
                  will be processed by the time requested. The department will 
                  not consider a need for expedited handling to arise if the 
                  request shows such need has resulted from circumstances within 
                  the control of the person making the request. 
                  .07 An individual or organization, or the authorized 
                  representative desiring to obtain information relating to the 
                  status of his or her request for an advisory opinion may do so 
                  by contacting the Office of Regulatory Standards and 
                  Exceptions, Pension and Welfare Benefit Programs, U.S. 
                  Department of Labor, Washington, D.C. 
                  Section 7. Instructions to Individuals and Organizations 
                  Requesting Advisory Opinions Relating to Prohibited 
                  Transactions and Common Definitions 
                  .01 [Reserved] 
                  .02 [Reserved] 
                  .03 [Reserved] 
                  Section 8. Conferences at DOL 
                  If a conference has been requested and the department 
                  determines that a conference is necessary or appropriate, the 
                  individual or organization or the authorized representative 
                  will be notified of the time and place of the conference. 
                  A conference will normally be scheduled only when the 
                  department in its sole discretion deems it will be necessary 
                  or appropriate in deciding the case. If conferences are being 
                  arranged with respect to more than one request for an opinion 
                  letter involving the same individual or organization, they 
                  will be so scheduled as to cause the least inconvenience to 
                  the individual or organization. 
                  Section 9. Withdrawal of Requests 
                  The individual or organization's request for an advisory 
                  opinion may be withdrawn at any time prior to receipt of 
                  notice that the department intends to issue an adverse 
                  opinion, or the issuance of an opinion. Even though a request 
                  is withdrawn, all correspondence and exhibits will be retained 
                  by the department and will not be returned to the individual 
                  or organization. 
                  Section 10. Effect of Advisory Opinion 
                  An advisory opinion is an opinion of the department as to the 
                  application of one or more sections of the Act, regulations 
                  promulgated under the Act, interpretive bulletins, or 
                  exemptions. The opinion assumes that all material facts and 
                  representations set forth in the request are accurate, and 
                  applies only to the situation described therein. Only the 
                  parties described in the request for opinion may rely on the 
                  opinion, and they may rely on the opinion only to the extent 
                  that the request fully and accurately contains all the 
                  material facts and representations necessary to issuance of 
                  the opinion and the situation conforms to the situation 
                  described in the request for opinion. 
                  Section 11. Effect of Information Letters 
                  An information letter issued by the department is 
                  informational only and is not binding on the department with 
                  respect to any particular factual situation. 
                  Section 12. Public Inspection 
                  .01 Advisory opinions shall be open to public inspection at 
                  the Public Disclosure Room, U.S. Department of Labor, 200 
                  Constitution Avenue, N.W., Washington, D.C. 20216. 
                  .02 Background files (including the request for an advisory 
                  opinion, correspondence between the department and the 
                  individual or organization requesting the advisory opinion) 
                  shall be available upon written request. Background files may 
                  be destroyed after three years from the date of issuance. 
                  .03 Advisory opinions will be modified to delete references to 
                  proprietary information prior to disclosure. Any information 
                  considered to be proprietary should be so specified in a 
                  separate letter at the time of request. Other than proprietary 
                  information, all materials contained in the public files shall 
                  be available for inspection pursuant to section 12. 
                  .04 The cost of search, copying and deletion of any references 
                  to proprietary information will be borne by the person 
                  requesting the advisory opinion or the background file. 
                  Section 13. Effective Date 
                  This advisory opinion procedure consists of rules of agency 
                  procedure and practice, and is therefore excepted under 5 
                  U.S.C. 552(b)(3)(A) of the Administrative Procedure Act from 
                  the ordinary notice and comment provisions for agency 
                  rulemaking. Accordingly, the procedure is effective August 27, 
                  1976, the date of its publication in the Federal Register. 
                  Signed at Washington, DC, this 24th day of August 1976
                  James D. Hutchinson
                  Administrator of Pension and Welfare Benefit Programs
                  U.S. Department of Labor 
                  [FR Doc. 76-25168 Filed 8-26-76;8:45 am] 

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