DOL Signals Changes to Fiduciary Rule
The Department of Labor has confirmed in its Spring 2021 regulatory agenda that it plans to make changes to the Trump administration's fiduciary rule, including amending the regulatory definition of the term fiduciary.
The Department of Labor has confirmed in its Spring 2021 regulatory agenda that the Employee Benefits Security Administration plans to make changes to the Trump administration’s fiduciary rule, including amending the regulatory definition of the term “fiduciary.”
According to the proposed rule summary, the fiduciary definition amendment would “take into account practices of investment advisers, and the expectations of plan officials and participants, and individual retirement account owners who receive investment advice, as well as developments in the investment marketplace, including in the ways advisers are compensated that can subject advisers to harmful conflicts of interest.”
In conjunction with the rulemaking, the Employee Benefits Security Administration will also evaluate available prohibited transaction class exemptions and consider proposing amendments or new exemptions.
The EBSA plans to issue a notice of proposed rulemaking in December 2021.
The Trump-era regulation replaced the previous iteration of the rule that was vacated by the Fifth Circuit Court of Appeals in 2018 for regulatory overreach. The revised rule went into effect in mid-February, with a temporary enforcement policy remaining in place until December 20, 2021.
