Acquisition and Sale of Trust Real Estate Investment Trust Shares by Individual Account Plans Sponsored by Trust Real Estate Investment Trusts

Prohibited Transaction Exemption 2004-07 permits an individual account pension plan sponsored by a real estate investment trust (REIT) within the meaning of Code section 856 that is organized as a trust under applicable law (Trust REIT), or by its affiliates, to purchase, hold and sell publicly traded shares of beneficial interest in the Trust REIT at the direction of the participant or an independent fiduciary. The relief also covers contributions in kind of REIT shares. Such purchases, holdings, and sales would otherwise be prohibited under ERISA section 406 and Code section 4975. The class exemption requires, among other conditions, that the Trust REIT (or its agent) provide the person who has authority to direct acquisition or sale of REIT shares with the most recent prospectus, quarterly report, and annual report concerning the Trust REIT prior to or immediately after an initial investment in the Trust REIT. The person with such authority may be, under the terms of the plan, either an independent fiduciary or a participant exercising investment rights pertaining to his or her individual account under the plan. Updated versions of the reports must be provided to the directing person as published. The exemption further requires the plan to maintain records concerning investments in a Trust REIT for a period of six years and make them available to interested persons including the Department, Internal Revenue Service, fiduciary or authorized representative of the plan, and participants and beneficiaries. The exemption requires confidentiality procedures, which must be designed to protect against the possibility that an employer may exert undue influence on participants regarding share-related transactions, and the participants and beneficiaries of the plan must be provided with a statement describing the confidentiality procedures in place and the fiduciary responsible for monitoring these procedures.

The latest form for Acquisition and Sale of Trust Real Estate Investment Trust Shares by Individual Account Plans Sponsored by Trust Real Estate Investment Trusts expires 2028-05-31 and can be found here.