Prohibited Transaction Class
Exemption for Certain Transactions Between Investment Companies and
Employee Benefit Plans (PTE 1977-4)
Extension without change of a currently approved collection
No
Regular
01/16/2026
Requested
Previously Approved
36 Months From Approved
02/28/2026
319,848
297,552
27,046
25,208
0
0
PTE 77-4, which was originally granted
on April 8, 1977, exempts from the prohibited transaction
restrictions the purchase and sale by an employee benefit plan of
shares from a registered, open-end investment company (mutual fund)
when a fiduciary of the plan (e.g., an investment manager) is also
the investment advisor for the investment company. There are three
disclosure requirements incorporated within the class exemption.
The first requirement is intended to put the plan on notice of
possible fees associated with the redemption of open-end mutual
fund shares. It requires disclosure of any redemption fees in the
current prospectus of the open-end mutual fund (the prospectus in
effect at the time of the plan’s acquisition or disposal of such
shares). The class exemption permits a plan to pay a redemption fee
on the sale, by redemption, of open-end mutual fund shares only if
the fee is paid to the open-end mutual company and the above noted
disclosure is made. The second requirement is that, at the time of
the purchase or sale of such mutual fund shares, an independent
fiduciary receive a copy of the current prospectus issued by the
open-end mutual fund and full written disclosure of the investment
advisory fees charged to or paid by the plan and the open-end
mutual fund to the investment advisor. Pursuant to advisory opinion
2013-04A, the Department interprets the term “prospectus” in PTE
77-4 to include a “summary prospectus” if the summary prospectus
meets the requirements of the Securities and Exchange Commission’s
revised disclosure provisions for mutual funds including a summary
prospectus rule that were published in 2009 Pursuant to the SEC’s
revised disclosure provisions, mutual funds also are required to
send the full prospectus to the investor upon an investor’s
request, and to provide the full prospectus on-line at a specified
internet site. The third requirement is that the independent
fiduciary be notified of any changes in the fees and approves in
writing the plan’s purchase or sale of affected mutual fund shares,
or the plan’s continued possession of any such mutual fund shares
that it had acquired before the fee changes.
US Code:
26
USC 4975 Name of Law: Internal Revenue Code of 1986
US Code: 29
USC 1108 Name of Law: Employee Retirement Income Security Act
of 1974
There are no program changes
for this submission. The Department has updated the wage rates, the
number of pension plans, the number of mutual fund complexes. As a
result, the number of responses has increased by 22,296 responses.
Furthermore, the hour burden has increased by 1,838 hours.
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.
1210-0049 PTE 77-4 SS 11-18-25.docx
AORequest.pdf
Full Prospectus On Demand