Best Interest Contract Exemption Conditions

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ASO GA E5 Savannah, GA [Amended]
Savannah/Hilton Head International Airport,
GA
(Lat. 32°07′39″ N., long. 81°12′08″ W.)
Hunter AAF
(Lat. 32°00′36″ N., long. 81°08′46″ W.)
That airspace extending upward from 700
feet above the surface within a 10-mile radius
of Savannah/Hilton Head International
Airport and within a 7-mile radius of Hunter
AAF.
Issued in College Park, Georgia, on March
27, 2017.
Joey L. Medders,
Acting Manager, Operations Support Group,
Eastern Service Area, Air Traffic
Organization.
[FR Doc. 2017–06769 Filed 4–6–17; 8:45 am]
BILLING CODE 4910–13–P

DEPARTMENT OF LABOR
Employee Benefits Security
Administration
29 CFR Part 2510
RIN 1210–AB79

Definition of the Term ‘‘Fiduciary’’;
Conflict of Interest Rule—Retirement
Investment Advice; Best Interest
Contract Exemption (Prohibited
Transaction Exemption 2016–01);
Class Exemption for Principal
Transactions in Certain Assets
Between Investment Advice
Fiduciaries and Employee Benefit
Plans and IRAs (Prohibited
Transaction Exemption 2016–02);
Prohibited Transaction Exemptions
75–1, 77–4, 80–83, 83–1, 84–24 and 86–
128
Employee Benefits Security
Administration, Labor.
ACTION: Final rule; extension of
applicability date.
AGENCY:

This document extends for 60
days the applicability date of the final
regulation, published on April 8, 2016,
defining who is a ‘‘fiduciary’’ under the
Employee Retirement Income Security
Act of 1974 and the Internal Revenue
Code of 1986. It also extends for 60 days
the applicability dates of the Best
Interest Contract Exemption and the
Class Exemption for Principal
Transactions in Certain Assets Between
Investment Advice Fiduciaries and
Employee Benefit Plans and IRAs. It
requires that fiduciaries relying on these
exemptions for covered transactions
adhere only to the Impartial Conduct
Standards (including the ‘‘best interest’’
standard), as conditions of the
exemptions during the transition period
from June 9, 2017, through January 1,

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SUMMARY:

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2018. Thus, the fiduciary definition in
the rule (Fiduciary Rule or Rule)
published on April 8, 2016, and
Impartial Conduct Standards in these
exemptions, are applicable on June 9,
2017, while compliance with the
remaining conditions in these
exemptions, such as requirements to
make specific written disclosures and
representations of fiduciary compliance
in communications with investors, is
not required until January 1, 2018. This
document also delays the applicability
of amendments to Prohibited
Transaction Exemption 84–24 until
January 1, 2018, other than the Impartial
Conduct Standards, which will become
applicable on June 9, 2017. Finally, this
document extends for 60 days the
applicability dates of amendments to
other previously granted exemptions.
The President, by Memorandum to the
Secretary of Labor dated February 3,
2017, directed the Department of Labor
to examine whether the Fiduciary Rule
may adversely affect the ability of
Americans to gain access to retirement
information and financial advice, and to
prepare an updated economic and legal
analysis concerning the likely impact of
the Fiduciary Rule as part of that
examination. The extensions announced
in this document are necessary to enable
the Department to perform this
examination and to consider possible
changes with respect to the Fiduciary
Rule and PTEs based on new evidence
or analysis developed pursuant to the
examination.
Effective dates: This rule is
effective April 10, 2017. The end of the
effective period for 29 CFR 2510.3–21(j)
is extended from April 10, 2017, to June
9, 2017.
Applicability dates: See Section E of
the SUPPLEMENTARY INFORMATION section
for dates for the prohibited transaction
exemptions.
DATES:

FOR FURTHER INFORMATION CONTACT:

• For questions pertaining to the
fiduciary regulation, contact Jeffrey
Turner, Office of Regulations and
Interpretations, Employee Benefits
Security Administration (EBSA), (202)
693–8825.
• For questions pertaining to the
prohibited transaction exemptions,
contact Karen Lloyd, Office of
Exemption Determinations, EBSA, (202)
693–8824.
• For questions pertaining to
regulatory impact analysis, contact G.
Christopher Cosby, Office of Policy and
Research, EBSA, (202) 693–8425. (Not
toll-free numbers).

SUPPLEMENTARY INFORMATION:

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A. Background
On April 8, 2016, the Department of
Labor (Department) published a final
regulation (Fiduciary Rule or Rule)
defining who is a ‘‘fiduciary’’ of an
employee benefit plan under section
3(21)(A)(ii) of the Employee Retirement
Income Security Act of 1974 (ERISA or
the Act) as a result of giving investment
advice to a plan or its participants or
beneficiaries. 29 CFR 2510.3–21. The
Fiduciary Rule also applies to the
definition of a ‘‘fiduciary’’ of a plan
(including an individual retirement
account (IRA)) under section
4975(e)(3)(B) of the Internal Revenue
Code of 1986 (Code). The Fiduciary
Rule treats persons who provide
investment advice or recommendations
for a fee or other compensation with
respect to assets of a plan or IRA as
fiduciaries in a wider array of advice
relationships than was true of the prior
regulatory definition (1975 Regulation).1
On this same date, the Department
published two new administrative class
exemptions from the prohibited
transaction provisions of ERISA (29
U.S.C. 1106) and the Code (26 U.S.C.
4975(c)(1)): The Best Interest Contract
Exemption (BIC Exemption) and the
Class Exemption for Principal
Transactions in Certain Assets Between
Investment Advice Fiduciaries and
Employee Benefit Plans and IRAs
(Principal Transactions Exemption), as
well as amendments to previously
granted exemptions. The new
exemptions are designed to promote the
provision of investment advice that is in
the best interest of retirement investors.
The new exemptions and certain
previously granted exemptions that
were amended on April 8, 2016
(collectively Prohibited Transaction
Exemptions or PTEs) would allow,
subject to appropriate safeguards,
certain broker-dealers, insurance agents,
and others that act as investment advice
fiduciaries, as defined under the
Fiduciary Rule, to continue to receive
compensation that would otherwise
violate prohibited transaction rules,
triggering excise taxes and civil liability.
Rather than flatly prohibit
compensation structures that could be
beneficial in the right circumstances,
the exemptions are designed to permit
investment advice fiduciaries to receive
commissions and other common forms
of compensation.
Among other conditions, the new
exemptions and amendments to
previously granted exemptions are
generally conditioned on adherence to
certain Impartial Conduct Standards:
1 The 1975 Regulation was published as a final
rule at 40 FR 50842 (Oct. 31, 1975).

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Providing advice in retirement
investors’ best interest; charging no
more than reasonable compensation;
and avoiding misleading statements
(Impartial Conduct Standards).2 The
Department determined that adherence
to these fundamental fiduciary norms
helps ensure that investment
recommendations are not driven by
adviser conflicts, but by the best interest
of the retirement investor.
By Memorandum dated February 3,
2017, the President directed the
Department to conduct an examination
of the Fiduciary Rule to determine
whether it may adversely affect the
ability of Americans to gain access to
retirement information and financial
advice. As part of this examination, the
Department was directed to prepare an
updated economic and legal analysis
concerning the likely impact of the
Fiduciary Rule and PTEs, which shall
consider, among other things:
• Whether the anticipated
applicability of the Fiduciary Rule and
PTEs has harmed or is likely to harm
investors due to a reduction of
Americans’ access to certain retirement
savings offerings, retirement product
structures, retirement savings
information, or related financial advice;
• Whether the anticipated
applicability of the Fiduciary Rule and
PTEs has resulted in dislocations or
disruptions within the retirement
services industry that may adversely
affect investors or retirees; and
• Whether the Fiduciary Rule and
PTEs is likely to cause an increase in
litigation, and an increase in the prices
that investors and retirees must pay to
gain access to retirement services.
The President directed that if the
Department makes an affirmative
determination as to any of the above
three considerations, or the Department
concludes for any other reason, after
appropriate review, that the Fiduciary
Rule, PTEs, or both are inconsistent
with the priority of the Administration
‘‘to empower Americans to make their
own financial decisions, to facilitate
their ability to save for retirement and
build the individual wealth necessary to
afford typical lifetime expenses, such as
buying a home and paying for college,
and to withstand unexpected financial
emergencies,’’ then the Department
2 In the Principal Transactions Exemption, the
Impartial Conduct Standards specifically refer to
the fiduciary’s obligation to seek to obtain the best
execution reasonably available under the
circumstances with respect to the transaction,
rather than to receive no more than ‘‘reasonable
compensation.’’ Accordingly, references in this
document to ‘‘reasonable compensation’’ in the
context of the Principal Transactions Exemption
should be read to refer to this best execution
requirement.

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shall publish for notice and comment a
proposed rule rescinding or revising the
Fiduciary Rule, as appropriate and as
consistent with law. The President’s
Memorandum was published in the
Federal Register on February 7, 2017, at
82 FR 9675.
In accordance with that
memorandum, the Department
published in the Federal Register on
March 2, 2017, at 82 FR 12319, a
document seeking comment on a
proposed 60-day extension of the
applicability dates of the Fiduciary Rule
and PTEs until June 9, 2017 (NPRM).
The comment period on the proposed
extension ended on March 17, 2017. In
that same document, the Department
sought comments regarding the
examination described in the
President’s Memorandum and on more
general questions concerning the
Fiduciary Rule and PTEs. This comment
period ends on April 17, 2017.
B. Public Comments & Decision on
Delay
As of the close of the first comment
period on March 17, 2017, the
Department had received approximately
193,000 comment and petition letters
expressing a wide range of views on
whether the Department should grant a
delay and the duration of any delay.
Approximately 15,000 commenters and
petitioners support a delay of 60 days or
longer, with some requesting at least
180 days and some up to 240 days or a
year or longer (including an indefinite
delay or repeal); and, by contrast,
178,000 commenters and petitioners
oppose any delay whatsoever.3 The
Department continues to receive a very
high volume of comment and petition
letters on a daily basis, both on the
delay and on the more general questions
that the Department set forth in its
NPRM. EBSA intends to continue to
post comment and petition letters for
public inspection on EBSA’s Web site as
quickly as practicable after receipt.
One of the main reasons offered by
commenters and petitioners in support
of a delay of the applicability date of the
Fiduciary Rule and PTEs is that the
Department needs time to properly
conduct the analysis required by the
3 The Department includes these counts only to
provide a rough sense of the scope and diversity of
public comments. For this purpose, the Department
counted letters that do not expressly support or
oppose the proposed delay, but that express
concerns or general opposition to the Fiduciary
Rule or PTEs, as supporting delay. Similarly, letters
that do not expressly support or oppose the
proposed delay, but that express general support for
the Rule or PTEs, were treated as supporting the
Rule and PTEs as originally drafted including
support for the April 10, 2017 applicability date,
and were therefore treated as opposing a delay.

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President’s Memorandum. Although
many commenters supported a 60-day
delay for this purpose, others argued
that a much longer period is needed
(e.g., a 1-year delay or an indefinite
extension terminating 60 or more days
after completion of the examination
required by the President’s
Memorandum). These commenters
asserted that unless the Department took
such an approach, it could be forced to
grant a series of short extensions, which
would produce serious frictional costs,
protracted uncertainty (for advisers,
financial institutions, and retirement
investors), wasted expenses on interim
and conditional compliance efforts, and
unnecessary market disruption. Many
commenters also requested that any
delay of the applicability date,
regardless of its length, be accompanied
by a commensurate adjustment in the
periods of transition relief available
under the BIC Exemption and the
Principal Transactions Exemption.
Many supporters of delay also argued
that the President’s Memorandum has
rendered the ultimate fate of the
Fiduciary Rule and PTEs uncertain and
that proceeding with the April 10, 2017
applicability date in the face of this
uncertainty would impose unnecessary
costs and burdens on the financial
services industry and result in
unnecessary confusion to investors
inasmuch as products, services, and
advisory practices could change after
completion of the examination. Some
expressed particular concern about the
risk of a chaotic transition process, as
firms try to communicate with millions
of clients to describe options that could
become applicable in April, but
subsequently change if parts of the
Fiduciary Rule or PTEs are later
reconsidered and changed after the
examination required by the President.
Another theme of commenters and
petitioners supporting delay is that,
even without regard to the President’s
Memorandum, the Department initially
erred in adopting April 10, 2017, as the
applicability date of the Fiduciary Rule
and PTEs. These commenters assert that
although financial institutions have
worked to put in place the policies and
procedures necessary to make the
business structure and practice shifts
required by the new rules,4 there is still
considerable work left to be done to
implement the new rules in a proper
and responsible manner and without
4 This includes drafting and implementing
training for staff, drafting client correspondence and
explanations of revised product and service
offerings, negotiating changes to agreements with
product manufacturers to facilitate compliance, and
changing employee and agent compensation
structures, among other things.

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causing further confusion and
disruption to retirement investors. Some
of these commenters and petitioners
also asserted that individual retirement
investors—those most impacted by the
Fiduciary Rule and PTEs—have not
themselves focused on how investment
products, related services, and costs
may change and need more time to
understand, process, and make
decisions regarding their accounts and
services.
Many commenters also based support
for delay on opposition to the substance
of the Fiduciary Rule and PTEs, as
written, and disagreement with the
conclusions reached in the final
rulemaking and associated Regulatory
Impact Analysis. In general, these
comments reiterated arguments made as
part of the notice and comment process
for the Rule and PTEs.5 For example,
commenters asserted that the Fiduciary
Rule and PTEs would unduly increase
costs and adversely affect access to
products, services, and advice. Industry
commenters, in particular, asserted that
unintended consequences of the
rulemaking could include the reduced
availability of advice to participants
with small account balances, such as
young savers; inappropriate increases in
fee-based accounts and passive
investments; reduced competition
among investment products and
providers; less innovation; and a
harmful exit of advisers from the
marketplace. Similarly, commenters
expressed concern about the costs
imposed by the Rule and PTEs on the
financial services industry, the
likelihood that those costs would be
passed on to plan and IRA investors,
and the risk of extensive class action
litigation. Commenters asserted that the
costs of the Fiduciary Rule and PTEs
would further increase if they become
applicable but are subsequently revised
5 The 2016 Regulatory Impact Analysis can be
accessed on EBSA’s Web site at (https://
www.dol.gov/sites/default/files/ebsa/laws-andregulations/rules-and-regulations/completedrulemaking/1210-AB32-2/conflict-of-interestria.pdf). Rather than repeat that analysis here, the
Department refers readers to 81 FR 21002 (April 8,
2016) (BIC Exemption) and 81 FR 21089 (April 8,
2016) (Principal Transactions Exemption) for
discussion of the issues raised by comments
expressing support or opposition to the Rule and
PTEs. The Department has requested additional
comments on these and related issues in connection
with its work on the President’s Memorandum. As
indicated in the preamble to the March 2, 2017
NPRM, the Department seeks comments on the
issues raised by the President’s Memorandum and
related questions by April 17, 2017, as detailed at
82 FR 12319, 12324–25. The Department urges
commenters to submit data, information, and
analyses responsive to the requests in that
document by that date, so that it can complete its
work pursuant to the Memorandum as carefully,
thoughtfully, and expeditiously as possible.

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or rescinded due to the examination
required by the President. Additionally,
commenters argued that the
complexities, ambiguities, and
uncertainties associated with the
Fiduciary Rule and PTEs require
additional time for implementation. A
number of commenters also asserted
that the rulemaking exceeded the
Department’s authority or would be
better left to other regulators, such as
the Securities and Exchange
Commission or state insurance
commissioners. To these commenters
and petitioners, delay is necessary in
order to review and address these
claims.
Other commenters and petitioners
expressed broad support for the Rule
and PTEs and opposition to any delay
in their implementation. Many of these
commenters stressed the Department’s
determination in the final rulemaking
that, under the current regulatory
structure, investors lose billions of
dollars each year as a result of conflicts
of interest, and argued that delay would
compound these losses. Commenters
argued that the Department already has
studied this topic, as well as the issues
presented in the President’s
Memorandum, at great length as part of
an extensive regulatory process, its
original analysis was not flawed, and
nothing has changed since then that
would warrant a reexamination.
Commenters noted that the rulemaking
had been upheld by three federal
district courts to date, and that two of
those courts had concluded that the
previous regulatory definition of
fiduciary investment advice may be
difficult to reconcile with the statutory
text of ERISA’s definition of fiduciary.
Opponents of a delay also argued that
the Fiduciary Rule and PTEs have
already contributed to positive changes
in the marketplace, and that further
delay could slow or reverse this
progress. Commenters also challenged
assertions that firms would be unable to
comply with their obligations as of
April 10, 2017, or that aspects of the
Rule or PTEs were unworkable; noted
that a number of firms have advertised
that they already are prepared for full
compliance with the Rule and PTEs;
asserted that concerns about class
actions were exaggerated and neglected
the values served by such litigation; and
argued that further delay would have
the effect of penalizing firms that took
regulatory deadlines seriously while
rewarding those that failed to take
appropriate actions to ensure
compliance. Similarly, commenters
opposing delay expressed support for
the substance of the Fiduciary Rule and
the PTEs, arguing that the Fiduciary

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Rule would protect retirement investors
from abuse; appropriately strengthen the
standards applicable to advisers; create
a level playing field for all advisers by
requiring adherence to a best interest
standard regardless of title or product;
align advisers’ standards with investors’
reasonable expectations that
recommendations will be based on their
best interests (also, thereby avoid
investor confusion about the
significance of different adviser
designations); and ensure that
investment recommendations and
choices are based on the investor’s
interests rather than advisers’ conflicts
of interest. Finally, a commenter argued
that the proposed delay is inconsistent
with the Congressional Review Act,
Executive Order 12866, Executive Order
13563 and Executive Order 13771,
among other things.6
In response to the Department’s
request for comments as to whether it
should delay only certain aspects of the
Rule and PTEs, but not others, the
commenters and petitioners had very
different views.7 A substantial number
of commenters that generally believe no
delay is warranted nevertheless stated
that, if the Department were to proceed
with a delay, the delay should only
partially apply: the Fiduciary Rule and
6 Some commenters said the 15-day comment
period on whether to delay was too short to provide
a meaningful opportunity for input, noting that
Executive Order 12866 recommends 60 days or
more. They also said the 45-day period for input on
reconsideration of the Rule and PTEs was
insufficient to address more complex issues
surrounding the likely impact of the Rule and PTEs.
The 15-day comment period was chosen in light of
the public reaction and media reports following the
Presidential Memorandum expressing concerns
about investor confusion and other marketplace
disruption based on uncertainty about whether a
delay could be accomplished before April 10. The
Department concluded that prompt action was
needed to protect against this investor confusion
and uncertainty, and to ensure that the Rule and
PTEs did not become temporarily applicable. In
addition, the primary question to address in this 15day period was whether or not to delay, an issue
less complex than those reserved for the 45-day
comment period. In any event, in this 15-day period
the Department received approximately 193,000
comment and petition letters expressing a wide
range of views on whether the Department should
grant a delay and the duration of any delay. That
level of public engagement itself belies the
contention that the public did not have a
meaningful opportunity to comment on the
proposal. The Department likewise disagrees with
the assertions regarding the 45-day comment
period. In light of the need for prompt action to
avoid continued uncertainty regarding the future of
the Rule and PTEs, the Department concluded that
a 45-day comment period would provide adequate
time for the public to provide input, generally, and
on the threshold questions raised in the Presidential
Memorandum. Importantly, although a high volume
of commentary continues to date, the Department
always has the ability to re-open the comment
period or otherwise solicit information to
supplement the public comment, if necessary.
7 See 82 FR 12319, 12321 (Mar. 2, 2017).

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Federal Register / Vol. 82, No. 66 / Friday, April 7, 2017 / Rules and Regulations
Impartial Conduct Standards of the
PTEs should be immediately applicable
even if other conditions and obligations
are postponed. These commenters
generally noted that many of the
nation’s largest financial institutions
publicly state their current adherence to
and support for a best interest standard,
and stated the merits of this approach
should be beyond dispute. Other
commenters, however, caution the
Department against permitting any part
of the Rule or PTEs to become
applicable before completion of the
examination required by the President’s
Memorandum. These commenters
essentially maintain that all issues
identified by the Presidential
Memorandum must be resolved before
any aspect of the Rule or PTEs become
applicable to avoid the possibility of
investor confusion and needless or
excessive expense as firms build
systems and compliance structures that
may ultimately be unnecessary or
mismatched with the Department’s final
decisions on the issues raised by the
Presidential Memorandum.
Based on its review and evaluation of
the public comments, the Department
has concluded that some delay in full
implementation of the Fiduciary Rule
and PTEs is necessary to conduct a
careful and thoughtful process pursuant
to the Presidential Memorandum, and
that any such review is likely to take
more time to complete than a 60-day
extension would afford, as many
commenters suggested. The Department
is also concerned that many firms may
have reasonably assumed that the
Department is likely to delay
implementation as proposed and may,
accordingly, have slowed their
compliance efforts. As a result, rigid
adherence to the April 10 applicability
date could result in an unduly chaotic
transition to the new standards as firms
rush to prepare required disclosure
documents and finalize compliance
structures that are not yet ready,
resulting in investor confusion,
excessive costs, and needlessly
restricted or reduced advisory services.
At the same time, however, the
Department has concluded that it would
be inappropriate to broadly delay
application of the fiduciary definition
and Impartial Conduct Standards for an
extended period in disregard of its
previous findings of ongoing injury to
retirement investors. The Fiduciary Rule
and PTEs followed an extensive public
rulemaking process in which the
Department evaluated a large body of
academic and empirical work on
conflicts of interest, and determined
that conflicted advice was causing harm

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to retirement investors.8 For all the
reasons detailed in the preambles for the
Fiduciary Rule and PTEs and in the
associated Regulatory Impact Analysis,
the Department concluded that much of
this harm could be avoided through the
imposition of fiduciary status and
adherence to basic fiduciary norms,
particularly including the Impartial
Conduct Standards.
The Department concludes that it can
best protect the interests of retirement
investors in receiving sound advice,
provide greater certainty to the public
and regulated parties, and minimize the
risk of unnecessary disruption by taking
a more balanced approach than simply
granting a flat delay of fiduciary status
and all associated obligations for a
protracted period. Specifically, the
Department extends the applicability
date for the Fiduciary Rule and the BIC
Exemption and Principal Transactions
Exemption (including their transition
relief) for 60 days, as proposed. The
applicability date of the Impartial
Conduct Standards in these exemptions
is extended for the same 60 days, while
compliance with other conditions for
transactions covered by these
exemptions, such as requirements to
make specific disclosures and
representations of fiduciary compliance
in written communications with
investors, is not required until January
1, 2018, by which time the Department
intends to complete the examination
and analysis directed by the Presidential
Memorandum. In this way, the
Fiduciary Rule (i.e., the new fiduciary
definition itself) will become applicable
after the 60-day delay, and the BIC
Exemption and the Principal
Transactions Exemption will be
available as of that date but these
exemptions will only require fiduciaries
to adhere to the Impartial Conduct
Standards for covered transactions until
January 1, 2018, when the remaining
conditions will apply unless revised or
withdrawn. The other requirements of
these PTEs, including representations of
fiduciary compliance, contracts,
warranties about firm’s policies and
procedures, etc., will not become
applicable during the period in which
the Department performs the mandated
examination of the Rule and PTEs. In
addition, the Department has delayed
the applicability of the amendments to
PTE 84–24 until January 1, 2018, except
that the Impartial Conduct Standards
will become applicable on June 9, 2017,
8 For example, the Department estimated that
advisers’ conflicts on average cost their IRA
customers who invest in front-end-load mutual
funds between 0.5 percent and 1.0 percent annually
in foregone risk-adjusted returns, due to poor fund
selection.

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and the Department has extended for 60
days the applicability dates of the 2016
amendments to other previously granted
exemptions.
This approach has a number of
significant advantages:
• Since there is fairly widespread,
although not universal, agreement about
the basic Impartial Conduct Standards,
which require advisers to make
recommendations that are in the
customer’s best interest (i.e., advice that
is prudent and loyal), avoid misleading
statements, and charge no more than
reasonable compensation for services
(which is already an obligation under
ERISA and the Code, irrespective of this
rulemaking), this approach provides
retirement investors with the protection
of basic fiduciary norms and standards
of fair dealing, while at the same time
honoring the President’s directive to
take a hard look at any potential undue
burdens.9 After the passage of a year
since the Rule and PTEs were
published, and based on public
comment, the Department finds little
basis for concluding that advisers need
more time to give advice that is in the
retirement investor’s best interest and
free from misrepresentations in
exchange for reasonable compensation.
Indeed, financial institutions and
advisers routinely hold themselves out
as providing just such advice.
• Because the provisions requiring
written representations and
commitments about fiduciary
compliance, execution of a contract,
warranties about policies and
procedures, and the prohibition on
imposing arbitration requirements on
class claims, would not go into effect
during this period, this approach
eliminates or minimizes the risk of
litigation, including class-action
litigation, in the IRA marketplace, one
of the chief concerns expressed by the
financial services industry in
connection with the Fiduciary Rule and
PTEs.
• This approach is consistent with
the Department’s compliance-first
9 Advice is in the retirement investor’s best
interest when the advice is rendered ‘‘with the care,
skill, prudence, and diligence under the
circumstances then prevailing that a prudent person
acting in a like capacity and familiar with such
matters would use in the conduct of an enterprise
of a like character and with like aims, based on the
investment objectives, risk tolerance, financial
circumstances, and needs of the Retirement
Investor, without regard to the financial or other
interests of the Adviser, Financial Institution, or
any Affiliate, Related Entity, or other party.’’ See
Section VIII(d) of the BIC Exemption As set forth
in the preamble to the BIC Exemption, 81 FR at
21028 (April 8, 2016), this definition ‘‘incorporates
the objective standards of care and undivided
loyalty that have been applied under ERISA for
more than forty years.’’

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posture toward implementation as
reflected in EBSA Field Assistance
Bulletin 2017–01 (March 10, 2017)
(announcing a temporary nonenforcement safe harbor for DOL
litigation for advisers and financial
institutions) 10 and its Conflict of
Interest FAQs (Part I—Exemptions) (Oct.
27, 2016) (‘‘The Department’s general
approach to implementation will be
marked by an emphasis on assisting
(rather than citing violations and
imposing penalties on) plans, plan
fiduciaries, financial institutions and
others who are working diligently and
in good faith to understand and come
into compliance with the new rule and
exemptions.’’).11 Although ERISA
provides a cause of action for violations
by fiduciary advisers to ERISA-covered
plans and plan participants, including
violations with respect to rollovers and
distributions of plan assets, the
Department’s focus will be on
compliance assistance, both in the
period before January 1, 2018, and for
some time after.
• This approach addresses financial
services industry concerns about
uncertainty over whether they need to
immediately comply with all of the
requirements of the PTEs, particularly
including the notice and disclosure
provisions that would otherwise have
become applicable on April 10, 2017,
without giving short shrift to the
competing interest of retirement
investors in receiving advice that
adheres to basic fiduciary norms.
Because the Impartial Conduct
Standards apply after 60 days,
retirement investors will benefit from
higher advice standards, while the
Department takes the additional time
necessary to perform the examination
required by the President’s
Memorandum.
• If, after receiving comments on the
issues raised by the President’s
Memorandum, the Department
concludes that significant changes are
necessary or that it needs more time to
complete its review, it retains the ability
to further extend the January 1, 2018
applicability dates or to grant additional
interim relief, such as more streamlined
PTEs, as it finalizes its review and
decides whether to make more general
changes to the Rule or PTEs.
10 See also IRS Announcement 2017–04 (March
27, 2017), I.R.B. 2017–16 (April 17, 2017), which
provides relief from certain excise taxes under Code
section 4975 and any related reporting requirements
to conform to the Department’s position in EBSA
Field Assistance Bulletin 2017–01.
11 Available at https://www.dol.gov/sites/default/
files/ebsa/about-ebsa/our-activities/resource-center/
faqs/coi-rules-and-exemptions-part-1.pdf

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In the Department’s view, this
approach gives the Department an
appropriate amount of time to
reconsider the regulatory burdens and
costs of the Fiduciary Rule and PTEs,
calls for advisers and financial
institutions to comply with basic
standards for fair conduct during that
time, and does not foreclose the
Department from considering and
making changes with respect to the Rule
and PTEs based on new evidence or
analyses developed pursuant to the
President’s Memorandum.
Accordingly, based on its review of
the comments, the Department has
decided to extend for 60 days the
applicability date of all provisions of the
Fiduciary Rule. In addition, the
applicability dates of the BIC Exemption
and the Principal Transactions
Exemption are extended for 60 days,
and these exemptions require
fiduciaries engaging in transactions
covered by the exemptions to comply
only with the Impartial Conduct
Standards, during the transition period
from June 9, 2017 through January 1,
2018. This document further delays the
applicability of the amendments to PTE
84–24 until January 1, 2018, except that
the Impartial Conduct Standards will
become applicable on June 9, 2017, and
extends for 60 days the applicability
dates of amendments to other
previously granted exemptions. The
Impartial Conduct Standards generally
require that advisers and financial
institutions provide investment advice
that is in the investors’ best interest,
receive no more than reasonable
compensation, and avoid misleading
statements to investors about
recommended transactions. As detailed
in the Regulatory Impact Analysis
below, a longer delay of the Rule and
Impartial Conduct Standards cannot be
justified based on the public record to
date. In the absence of the Impartial
Conduct Standards, retirement investors
are likely to continue incurring new
losses from advisory conflicts. Losses
arising from a delay of longer than 60
days would quickly overshadow any
additional compliance cost savings.
The predicted cost savings and
investor losses associated with this
extension may increase or decrease
depending on the information and data
received in response to the comment
solicitation contained in the March 2017
NPRM. Between now and April 17,
2017, the Department will continue to
receive and review these additional
public comments, and between now and
January 1, 2018, the Department will
perform the examination required by the
President. Following the completion of
the examination, some or all of the Rule

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and PTEs may be revised or rescinded,
including the provisions scheduled to
become applicable on June 9, 2017. This
document’s delay of the applicability
dates as described above should not be
viewed as prejudging the outcome of the
examination.
The approach adopted in this
document seeks to address the major
concerns of the commenters and
petitioners in an equitable and cost
efficient manner. There was no
consensus among commenters and
petitioners regarding whether, and how
long, to delay the applicability date of
the Rule and PTEs, or even whether to
retain or rescind the Rule and PTEs in
whole or in part. Applying the Rule and
the Impartial Conduct Standards after a
60-day delay, however, means that
much of the potential investor gains
predicted in the Rule’s regulatory
impact analysis published on April 8,
2016, will commence on June 9, 2017,
and accrue prospectively while the
Department performs the examination
mandated by the President and
considers potential changes to the Rule
and PTEs.
As compared to the contract,
disclosure, and warranty requirements
of the BIC Exemption and Principal
Transactions Exemption, the Fiduciary
Rule and the Impartial Conduct
Standards are among the least
controversial aspects of the rulemaking
project (although not free from
controversy or unchallenged in
litigation). Indeed, even among many of
the commenters and petitioners that
support a delay of the applicability date,
there are varying degrees of support for
the Rule and the Impartial Conduct
Standards. In the Department’s
judgment, Plan and IRA investors, firms,
and advisers all will benefit from the
balanced approach set forth above.
Firms and advisers will be given
additional time for an orderly transition
and will not be required to immediately
provide the notices, disclosures, and
written commitments of fiduciary
compliance that would otherwise be
immediately required under the BIC
Exemption and Principal Transactions
Exemption. Also, more controversial
provisions—such as requirements to
execute enforceable written contracts
under the Best Interest Contract and
Principal Transactions Exemption, and
changes to PTE 84–24 (other than the
addition of the Impartial Conduct
Standards)—are not applicable until
January 1, 2018, while the Department
is honoring the President’s directive to
take a hard look at any potential undue
burdens and decides whether to make
significant revisions. As indicated
above, if, after receiving comments on

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the issues raised by the President’s
Memorandum, the Department
concludes that significant changes are
necessary or that it needs more time to
complete its review, it retains the ability
to further extend the January 1, 2018
applicability dates or to grant additional
interim relief, such as more streamlined
PTEs, as it finalizes its review and
decides whether to make more general
changes to the Rule or PTEs.
C. Regulatory Impact Analysis
On March 2, 2017, the Department
published the NPRM seeking comment
on a proposed 60-day delay of the
applicability date of the Fiduciary Rule
and PTEs until June 9, 2017.12 The
comment period for the proposed
extension closed on March 17, 2017.
After careful review and consideration
of the comments, the Department is
issuing this final rule that will (1)
extend the applicability date of the
Fiduciary Rule, the BIC Exemption, and
the Principal Transactions Exemption
for 60 days until June 9, 2017, and (2)
require that fiduciaries relying on these
exemptions for covered transactions
adhere only to the ‘‘best interest’’
standard and the other Impartial
Conduct Standards of these PTEs during
a transition period from June 9, 2017,
through January 1, 2018. As a result, the
Fiduciary Rule and the Impartial
Conduct Standards in these PTEs will
become applicable beginning on June 9,
2017, while other conditions in these
PTEs, such as requirements to make
specific written disclosures and
representations of fiduciary compliance
in investor communications, are not
required until January 1, 2018. In
addition, the Department also delays the
applicability of amendments to PTE 84–
24 until January 1, 2018, except that the
Impartial Conduct Standards will
become applicable on June 9, 2017, and
extends the applicability dates of the
amendments to other previously granted
PTEs for 60 days until June 9, 2017.
As fully discussed above in Section B,
the Department received many
comments supporting and opposing the
applicability date delay. In general,
commenters opposing the delay
expressed concern regarding the harm
investors would suffer if their advisers
continue providing conflicted advice to
them while the applicability date for the
Fiduciary Rule and PTEs is delayed. On
the other hand, commenters supporting
the proposed 60-day delay or a longer or
indefinite delay argued that such delay
would be appropriate, because it would
12 The Department would also treat Interpretative
Bulletin 96–1 as continuing to apply during the 60day extension of the applicability date of the Rule.

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provide sufficient time for the
Department to complete its review of
the Rule and PTEs in conformance with
the President’s Memorandum without
issuing a series of extensions that could
create market frictions due to
uncertainty regarding whether the
Department would ultimately leave the
Rule in place, revise it, or rescind it.
The Department’s decision to delay
the applicability date of the Fiduciary
Rule for 60 days and make the Impartial
Conduct Standards in the new PTEs and
amendments to previously granted PTEs
applicable on June 9, 2017, is expected
to produce benefits that justify
associated costs. On the benefits side,
the 60-day delay of the April 10
applicability date will avert the
possibility of a costly and disorderly
transition to the Impartial Conduct
Standards on April 10. In the face of
uncertainty and widespread questions
about the Fiduciary Rule’s future or
possible repeal, many financial firms
slowed or halted their efforts to prepare
for full compliance on April 10.
Consequently, failure to delay that
applicability date could jeopardize such
firms’ near-term ability and/or
propensity to serve classes of customers,
and both such firms and their investor
customers could suffer. Investors whose
cost to select and change to a different
firm are high would be more adversely
affected by such disruption. Also on the
benefits side, both the 60-day delay and
the subsequent transition period will
generate cost savings for firms. Today’s
final rule will produce more cost
savings for firms than a 60-day delay of
the PTEs’ applicability date would
alone, because many exemption
conditions would not have to be met
until January 1, 2018. The Department
notes, however, that the benefits of
avoiding disruption and compliance
cost savings generally will be
proportionately larger for those firms
that currently are less prepared to
comply with the Fiduciary Rule and
PTEs.
On the cost side, the NPRM RIA
predicted that a 60-day delay alone
would inflict some losses on investors,
because advisory conflicts would
continue to affect some advice rendered
during those 60 days. However, the
Department now believes that investor
losses from the 60-day extension
provided here will be relatively small.
Because many firms have already taken
steps toward honoring fiduciary
standards, some investor gains from the
Fiduciary Rule are already being
realized and are likely to continue. On
the other hand, because many other
firms are not immediately prepared to
satisfy new requirements beginning

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April 10, and need additional time to
comply, the 60-day delay is unlikely to
deprive investors of additional gains.13
Finally, because the Impartial
Conduct Standards will become
applicable on June 9, 2017, the
Department believes that firms will
make efforts to adhere to those
standards, motivated both by their
applicability and by the prospect of
their likely continuation, as well as by
the impending applicability of
complementary consumer protections
and/or enforcement mechanisms
beginning on January 1, 2018,
depending on the results of the
Department’s review of the Fiduciary
Rule pursuant to the President’s
Memorandum. Because of Firms’
anticipated efforts to satisfy the
Impartial Conduct Standards during that
review, the Department believes that
most, but not all, of the investor gains
predicted in the 2016 RIA for the
transition period will remain intact. The
fraction of these gains that will be lost
during the transition period (and future
returns not realized because of those
losses), however, will represent a cost of
this final rule.
Several recent media articles reported
that industry and market observers
anticipate multiple extensions because
they believe 60 days would not be
sufficient for the Department to
conclude its re-examination.14 Several
commenters were also skeptical that the
Department can complete its thorough
re-evaluation within the 60 day period
as proposed. Thus, those commenters
supported much longer-term extensions
such as a one-year or indefinite
extension. Under this final rule
extending the applicability dates,
stakeholders can plan on and prepare
for compliance with the Fiduciary Rule
and the PTEs’ Impartial Conduct
Standards beginning June 9, 2017. At
the same time, stakeholders will be
assured that they will not be subject to
the other exemption conditions in the
BIC Exemption and the Principal
Transactions Exemption until at least
January 1, 2018. The Department will
aim to complete its review pursuant to
13 Comments on the NPRM and various media
reports together suggest that there is substantial
variation in different firms’ preparedness to comply
with various provisions of the Fiduciary Rule and
PTEs. Differences in firms’ preparedness may reflect
differences in the level of effort required to achieve
compliance, differences in the availability of
resources to undertake such efforts, differences in
expectations about whether, how and when the
Fiduciary Rule and PTEs might be revised,
differences in perceptions of and appetite for
compliance and/or market risk, or some
combination of these factors.
14 Mark Schoeff Jr. Investment News, March 1,
2017, ‘‘Delay of DOL Fiduciary Rule likely to
extend beyond 60 days.’’

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the President’s Memorandum as soon as
possible before that date and announce
its intention on whether to propose
changes to the Rule or PTEs, provide
additional transitional relief, or to allow
all the conditions of the PTEs to become
applicable as scheduled on January 1,
2018.
The Department has concluded that
the benefits of this final rule, which
include the estimated cost savings, the
potential reduction in transition costs,
the reduction of uncertainties, and the
avoidance of major and costly market
disruptions, justify its costs.

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1. Executive Order 12866 Statement
This final rule is an economically
significant regulatory action within the
meaning of section 3(f)(1) of Executive
Order 12866, because it would likely
have an effect on the economy of $100
million in at least one year.
Accordingly, the Department has
considered the costs and benefits of the
final rule, and it has been reviewed by
the Office of Management and Budget
(OMB).
a. Investor Gains
Some commenters suggested that the
Department underestimated the harms
to investors from NPRM’s proposed
delay, because the illustrative losses of
investor gains did not include all types
of conflicts nor all types of investment
in addition to excluding the harms
associated with rollover
recommendations and small plans. One
commenter offered its own estimates of
investor losses, significantly larger than
the Department’s, due to this delay.
Other commenters argued that the
Department’s estimated investor losses
from the proposed 60-day delay were
overstated because they were derived
from the 2016 RIA, which these
commenters contend overestimated net
investor gains.
The Department’s regulatory impact
analysis of the Fiduciary Rule and
related PTEs (2016 RIA) predicted that
resultant gains for retirement investors
would justify the compliance costs. The
analysis estimated a portion of the
potential gains for IRA investors at
between $33 billion and $36 billion over
the first 10 years for one segment of the
market and category of conflicts of
interest. It predicted, but did not
quantify, additional gains for both IRA
and ERISA plan investors.
In considering the benefits and costs
of this final rule, the Department
considered both the effects of the 60-day
delay (until June 9) in the applicability
of the Fiduciary Rule and PTEs and
Impartial Conduct Standards
conditions, and the longer delay (until

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January 1, 2018) in the applicability of
the other exemption conditions in the
BIC Exemption and the Principal
Transactions Exemption.
The NPRM’s RIA illustrated a possible
effect of a 60-day delay in the
commencement of the potential investor
gains estimated in the 2016 RIA. The
illustration indicated that such a delay
could result in a reduction in those
estimated gains of $147 million in the
first year and $890 million over 10 years
using a three percent discount rate.15
The illustration used the same
methodology that the 2016 RIA used to
estimate potential investor gains from
the Rule. Both made use of empirical
evidence that front-end-load mutual
funds that share more of the load with
distributing brokers attract more flows
but perform worse.16
To the extent that investment advisers
comply with the Fiduciary Rule and
PTEs only when the Fiduciary Rule and
PTEs are applicable on their original
terms and schedule, this estimate
represents a reasonable adjustment of
the 2016 estimate to reflect the impact
of the 60-day delay. On the other hand,
if some advisers would comply with or
without a delay or would fail to comply
with or without a delay, then the
estimate overstates the delay’s impact.
Public comments that have implications
for these possibilities will be discussed
below.
A number of comments on the NPRM
indicate that some firms are not
prepared to comply with the Fiduciary
Rule beginning on April 10, 2017. Based
on these comments, it appears that, even
before the President issued his
Memorandum, at least some firms were
not on course to achieve full compliance
with the Impartial Conduct Standards
by that date. In addition, over the nearly
sixty days since the President’s
Memorandum, many firms have
assumed that the Department is likely to
grant a delay or even repeal the
15 The ten-year estimate using a seven percent
discount rate was $610 million. The equivalent
annualized estimates were $104 million using a
three percent discount rate and $87 million using
a seven percent discount rate.
16 Other characteristics that are shared due to the
common methodology include: (1) The estimates
encompass both transfers and changes in society’s
real resources (the latter being benefits in the
context of the 2016 RIA but costs in this RIA
because gains are forgone); (2) the estimates have
a tendency toward overestimation in that they
reflect an assumption that the April 2016 Fiduciary
Rule will eliminate (rather than just reduce)
underperformance associated with the practice of
incentivizing broker recommendations through
variable front-end-load sharing; and (3) the
estimates have a tendency toward underestimation
in that they represented only one negative effect
(poor mutual fund selection) of one source of
conflict (load sharing), in one market segment (IRA
investments in front-load mutual funds).

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rulemaking, and stepped back their
compliance efforts accordingly. As a
result, the Department is concerned that
a significant portion of the industry is
not in a position to issue millions of
notices, finalize and fully stand-up
transition compliance structures, and
perform all the other work necessary to
comply with their obligations under the
transition provisions of the BIC
Exemption and Principal Transaction
Exemption by the April 10, 2017
deadline.
As a result, notwithstanding the
Department’s efforts to issue transitional
enforcement relief, absent an additional
sixty days’ extension, there is a
significant risk of a confused and
disorderly transition process, rushed
business decisions, excessive expenses
because of deadlines that are now too
tight, and poor or inaccurate
communications to consumers. This
could also lead to reduced services and
increased costs for consumers in the
short term. While the Department
cannot readily quantify the impact of
these considerations, there is substantial
reason to believe that they could
substantially offset the benefits portion
of the investor gains originally posited
by (but not quantified in) the 2016 RIA
in the sixty days immediately following
the original applicability date. The
calculated investor gains above were
based on the assumption that firms
would be in a position to comply with
their transitional obligations by April
10, 2017. As noted previously, to the
extent that assumption is incorrect, the
calculations overstate the likely injury
caused by delay.
The 60-day extension permits an
orderly transition to the Impartial
Conduct Standards to once again occur,
so that investors can gain from firms’
adherence to these basic standards.
Additionally, the approach taken by this
document gives the Department the time
necessary to implement the President’s
Memorandum, while avoiding the risk
that firms will engage in costly
compliance activities to meet
requirements that the Department may
ultimately decide to revise. It has been
close to a year since the Department
finalized the Fiduciary Rule and PTEs,
and now with the additional extension
of the applicability date contained in
this final rule, there is little basis for
concluding that advisers need still more
time before they will be ready to give
advice that is in the best interest of
retirement investors and free from
material misrepresentations in exchange
for reasonable compensation. In
addition, some comments indicate that
some firms have already adopted and
intend to maintain fiduciary standards

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of conduct. For this reason too, investor
losses from the 60-day delay are likely
to be smaller than would otherwise be
the case.
At the same time, the Department
notes that the NPRM RIA’s illustration
of potential investor losses was
incomplete because it represented only
one negative effect of one source of
conflict in one market segment.
Accordingly, some commenters
suggested that the Department
underestimated the harms to investors
from NPRM’s proposed delay, because
the illustrative losses of investor gains
did not include all types of conflicts nor
all types of investment in addition to
excluding the harms associated with
rollover recommendations and small
plans.17 One commenter offered its own
estimates of investor losses,
significantly larger than the
Department’s, due to this delay. For
example, the comment letter submitted
by Economic Policy Institute (EPI)
estimates that retirement savers who
received conflicted advice during the
60-day delay would receive $3.7 billion
less when their savings are drawn down
over 30 years compared to those savers
that did not receive conflicted advice.
EPI derived its estimate using the
methodology the White House Council
of Economic Advisors (CEA) used in its
2015 report, which estimated that the
aggregate annual cost of conflicted
advice is about $17 billion each year).18
The Department notes that the EPI
estimate covers broad range of
investments including variable
annuities and other types of mutual
funds, while the Department’s estimates
in the 2016 final RIA are based solely on
front-end load mutual funds.
Other commenters argued that the
Department’s estimated investor losses
from the proposed 60-day delay were
overstated because they were derived
from the 2016 RIA, which these
commenters contend overestimated net
investor gains. These commenters
generally contend the 2016 RIA wrongly
applied published research to estimate
investor gains and/or failed to properly
account for social costs such as
potential loss of access to financial
advice.19 These comments largely echo
comments made in response to the
Fiduciary Rule when it was proposed in
17 For example, the comment letter submitted by
Consumer Federation of America on March 17,
2017 argued that regulatory impact analysis for the
Fiduciary Rule is inadequate.
18 The CEA report was most recently accessed at
the following URL: https://
permanent.access.gpo.gov/gpo55500/
cea_coi_report_final.pdf.
19 For example, see the ICI comment letter and the
IRI comment letter.

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2015, and that were addressed in
considerable detail in the 2016 RIA. In
the 2016 RIA, the Department
concluded that published research
supports its estimates of investor gains
and that the Fiduciary Rule and PTEs
were not likely to impose additional
social costs as a result of the loss of
access to financial advice.20 The
Department notes that its conclusion
that investor losses from this delay will
be small has no immediate bearing on
the conclusions of its 2016 RIA.
However, the Department will review
the 2016 RIA’s conclusions as part of its
review of the Fiduciary Rule and PTEs
directed by the Presidential
Memorandum.
With respect to this final rule’s delay
in the applicability of exemption
conditions other than the Impartial
Conduct Standards in the BIC
Exemption and the Principal
Transactions Exemption until January 1,
2018, the Department considered
whether investor losses might result.
Under this final rule, beginning on June
9, 2017, advisers will be subject to the
prohibited transaction rules and will
generally be required to (1) make
recommendations that are in their
client’s best interest (i.e., IRA
recommendations that are prudent and
loyal), (2) avoid misleading statements,
and (3) charge no more than reasonable
compensation for their services. If
advisers fully adhere to these
requirements, affected investors will
generally receive the full gains due to
the fiduciary rulemaking. However, the
temporary absence (until January 1,
2018) of exemption conditions intended
to support and provide accountability
mechanisms for such adherence (e.g.,
conditions requiring advisers to provide
a written acknowledgement of their
fiduciary status and adherence to the
Impartial Conduct Standards) obliges
the Department to consider the
possibility that some lapses in
compliance may result in associated
investor losses.
Advisers who presently are
fiduciaries may be especially likely to
fully satisfy the PTEs’ Impartial Conduct
Standards before January 1, 2018, in the
ERISA-plan context, because advisers
who make recommendations to plans
and plan participants regarding plan
assets, including recommendations on
rollovers or distributions of plan assets,
are already subject to standards of
prudence and loyalty under ERISA and
a violation of the Impartial Conduct
20 The 2016 RIA is available at https://
www.dol.gov/sites/default/files/ebsa/laws-andregulations/Rules-and-regulations/completedRulemaking/1210-AB32-2/conflict-of-interestria.pdf. See pp. 312–324.

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Standards would be subject to claims for
civil liability under ERISA. Moreover,
financial institutions and advisers who
do not provide impartial advice as
required by the Rule and PTEs would
violate the prohibited transaction rules
of the Code.
In addition, the temporary absence of
the transitional disclosure conditions in
the BIC Exemption and Principal
Transactions Exemption is likely to
have a smaller impact than would be
true if the Impartial Conduct Standards
were removed. Advisers would be
expected to exercise care to fairly and
accurately describe recommended
transactions and compensation practices
pursuant to the Impartial Conduct
Standards which require advisers to
make recommendations that are prudent
and loyal (i.e., in the customer’s best
interest), free from misrepresentations,
and consistent with the reasonable
compensation standard.21 In addition,
even though advisers would not be
specifically required by the terms of
these PTEs to notify retirement investors
of the Impartial Conduct Standards and
to acknowledge their fiduciary status
before January 1, 2018, many investors
are likely to know they are entitled to
advice that adheres to a fiduciary
standard because this final rule will
receive publicity from the Department
and media, and many advisers will
likely notify consumers voluntarily
about the imposition of the standard
and their adherence to that standard as
a best practice.
Comments received by the
Department and media reports also
indicate that many financial institutions
already had completed or largely
completed work to establish policies
and procedures necessary to make the
business structure and practice shifts
required by the Impartial Conduct
Standards earlier this year (e.g., drafting
and implementing training for staff,
drafting client correspondence and
explanations of revised product and
service offerings, negotiating changes to
agreements with product manufacturers
as part of their approach to compliance
with the PTEs, changing employee and
agent compensation structures, and
designing conflict-free product
offerings), and the Department believes
that financial institutions may use this
compliance infrastructure to ensure that
they meet the Impartial Conduct
Standards after taking the additional
21 In addition to various disclosure and
representation obligations, other delayed conditions
in the BIC Exemption and Principal Transactions
Exemption include requirements to designate
persons responsible for addressing material
conflicts of interest and monitoring compliance and
to comply with recordkeeping obligations.

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sixty days for an orderly transition
between June 9, 2017, and January 1,
2018.
For these reasons, the Department
expects that advisers’ compliance with
the Impartial Conduct Standards during
the period between June 9, 2017 and
January 1, 2018, will be substantial,
even if there is some reduction in
compliance relative to the baseline. The
Department is uncertain about the
magnitude of this reduction and will
consider this question as part of its
review of the Fiduciary Rule and PTEs
pursuant to the President’s
Memorandum.
b. Cost Savings

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In the 2016 RIA, the Department
estimated that Financial Institutions
would incur $16 billion in compliance
costs over the first 10 years, $5 billion
of which are first-year costs. Delaying
the applicability date of the Rule and
PTEs would result in cost savings due
to foregone costs of complying for 60
days with the new PTE conditions.
Additionally, after June 9, 2017 until at
least January 1, 2018, financial
institutions and advisers relying on the
BIC Exemption and Principal
Transactions Exemption to engage in
covered transactions would have to
satisfy only the Impartial Conduct
Standards of those exemptions. They
would not be specifically required to

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meet other transition period
requirements of these PTEs, such as to
make specific written disclosures and
representations of fiduciary status and
of compliance with fiduciary standards
in investor communications, designate a
person or persons responsible for
addressing material conflicts of interest
and monitoring advisers’ adherence to
the Impartial Conduct Standards, and
comply with new recordkeeping
obligations.
Therefore, due to both the 60-day
delay of the Fiduciary Rule and PTEs
and the reduced transition period
requirements, the Department estimates
cost savings of $78 million until January
1, 2018. The Department estimates that
the ten-year cost savings, which also
include returns on the cost savings that
occur in the April 10, 2017, to January
1, 2018 time period, are $123 million
using a three percent discount rate, and
$114 million using a seven percent
discount rate. The equivalent
annualized values are $14.4 million
using a three percent discount rate and
$16.2 million using a seven percent
discount rate.22
Figure 1 shows the sources of the
cost-savings. Please note that numbers
22 Estimates are derived from the ‘‘Data
Collection,’’ ‘‘Record Keeping (Data Retention),’’
and ‘‘Supervisory, Compliance, and Legal
Oversight’’ categories discussed in section 5.3.1 of
the 2016 final RIA and reductions in the number
of the transition notices that will be delivered.

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in the table do not equal the ten-year
total costs-saving, because they are not
discounted. The cost savings to firms
due to the delay remain unchanged
relative to what was estimated for the
NPRM, while the cost-savings from the
complete elimination of the transition
notice has increased. Also note that
even though the applicability date of the
exemption conditions have been
delayed during the transition period, it
is nevertheless anticipated that firms
that are fiduciaries will implement
procedures to ensure that they are
meeting their fiduciary obligations, such
as changing their compensation
structures and monitoring the sales
practices of their advisers to ensure that
conflicts in interest do not cause
violations of the Impartial Conduct
Standards, and maintaining sufficient
records to corroborate that they are
adhering to Impartial Conduct
Standards. However, these firms have
considerably more flexibility to choose
precisely how they will comply during
the transition period. Therefore, there
could be additional cost savings not
included in these estimates if, for
example, firms develop more efficient
methods to adhere to the Impartial
Conduct Standards. The Department
does not have sufficient data to estimate
these cost savings, therefore, they are
not quantified.

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The delay of applicability dates
described in this final rule could defer
or reduce start-up compliance costs,
particularly in circumstances where
more gradual steps toward preparing for
compliance are less expensive.
However, due to lack of systematic
evidence on the portion of compliance
activities that have already been
undertaken, thus rendering the
associated costs sunk, the Department is
unable to quantify the potential change
in start-up costs that would result from
a delay in the applicability date and
elimination of the transition disclosure
requirement.
Commenters addressed the issue of
start-up costs that have not yet been
incurred suggesting that a delay could
yield substantial savings, particularly if
subsequent changes to the Fiduciary
Rule and PTEs or subsequent market
developments make it possible to avoid
or reduce such costs. One commenter
provided as an example of start-up costs
that might be avoided the cost of
developing ‘‘T’’ shares—a cost that has
not yet been incurred by some affected
firms. T shares, a class of mutual fund
shares, generally would pay advisers a
uniform commission, thereby mitigating
advisory conflicts otherwise associated

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with variation in commission levels
across different mutual funds. Some
investment companies had been rushing
to develop T shares in order to comply
with the Fiduciary Rule and PTEs’
originally scheduled applicability dates.
However, some investment companies
are now pursuing an alternative
approach, sometimes referred to as
‘‘clean’’ shares, as a potentially better
solution. Clean shares would have no
commission attached. Instead,
distributing brokers would set their own
commission levels, and generally would
set the levels uniformly across different
funds they recommend, thereby
mitigating potential conflicts from
variation in commission levels. The
clean share approach recently became
more viable, owing to new SEC staff
guidance clarifying its permissibility
under applicable law. It now seems
likely that the T-share approach will
yield to clean shares. Consequently, this
final rule’s delay in the applicability of
the Fiduciary Rule and PTEs might
make it possible to avoid some of the
cost of continuing to develop and
implement T-shares, in favor of moving
more directly to what might be the
preferred long-term solution, namely,
clean shares.

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More generally, however, it is unclear
what proportion of start-up costs might
be avoided as a result of this final rule’s
delay of applicability dates. Absent
additional changes to the Fiduciary Rule
or PTEs, firms are likely to incur most
of these costs eventually. The
Department generally believes that startup costs not yet incurred for
requirements scheduled to become
applicable January 1, 2018, should not
be included as a cost savings associated
with this final rule, because it remains
to be determined whether those
requirements will be revised or
eliminated.
Some comments generally argued that
the compliance cost estimates presented
in the 2016 RIA were understated, and
that therefore the cost savings from a
delay in the applicability of all or some
of the requirements of the Fiduciary
Rule and PTEs would be larger than
estimated above.
Some comments reported expected
costs savings if the Fiduciary Rule is
rescinded or modified; however, that
information is not useful for calculating
the cost savings associated with this
final rule, because the appropriate baseline for this analysis assumes full
implementation of the Fiduciary Rule

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and PTEs by January 1, 2018. Those
start-up costs that have not been
incurred only would have an impact if
the Department decides in the future to
delay the January 1, 2018
implementation date or to revise or
repeal the obligations of firms and
advisers. The Department does not have
any basis for predicting such changes at
this time, before it has received
substantial new data or evidence in
response to the President’s
Memorandum.
A commenter also asserted that the
Department significantly understated
the cost savings that would result from
a 60-day delay. This assertion had three
components: (1) The commenter
estimated the cost over 60 days to be
$250 million based on the on-going cost
from the final 2016 RIA of $1.5 billion
per year, (2) that cost savings over a 10year period were not provided to allow
comparison to the negative effects on
investors that would occur over the ten
year period, (3) that industry cost
savings were not projected out over 10
years using returns on capital in a
similar manner to investors’ lost
earnings. The Department stands behind
its estimate, however, because the
commenter misapplied the estimates
from the 2016 final RIA when
developing its cost-saving estimate. The
$1.5 billion on-going costs are the costs
of compliance for all components of the
Fiduciary Rule and PTEs; however, the
delay affects only the costs related to the
transition period requirements which
are a subset of the costs included in the
$1.5 billion estimate. Also, when
estimating the costs for the Fiduciary
Rule and PTEs a decision was made, for
simplification of estimation, to overestimate costs for the transition period
by using the same costs for the
transition period as was used for the
period with full compliance during that
time period.
The comment’s assertions in items (2)
and (3) above also are incorrect. Instead
of a ten-year total cost number, an
annualized number for the ten-year
period was provided in the NPRM for
both the cost savings ($8 million using
a three percent discount rate and $9
million using a seven percent discount
rate) and for the negative investor
impacts ($104 million using a three
percent discount rate and $87 million
using a seven percent discount rate).
Annualized numbers use the same
inputs as those used to estimate a tenyear discounted total number, thereby
allowing a comparison of expected
impacts across the ten-year period. Also,
the cost savings to firms from the delay
were projected out for ten years and
included in the annualized numbers to

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account for the fact that due to the
delayed applicability date, financial
institutions will have additional
resources to reinvest in their firms. This
parallels the methodology the
Department used to estimate the tenyear reduction in investor gains that
will result from the delay. Contrary to
the concerns expressed by another
commenter, the reported annualized
number does not mean that costs are
spread equally across the ten years.
Another commenter agreed that a
delay ‘‘could delay or reduce start-up
compliance costs, particularly in
circumstances where more gradual steps
towards preparing for compliance are
less expensive.’’ However, the
commenter failed to provide any
estimates or data that would help the
Department quantify such cost savings.
c. Alternatives Considered
In conformance with Executive Order
12866, the Department considered
several alternatives in finalizing this
final rule that were informed by public
comments. As discussed below, the
Department believes the approach
adopted in this final rule likely yields
the most desirable outcomes including
avoidance of costly market disruptions,
more compliance cost savings than
other alternatives, and reduced investor
losses. In weighing different options, the
Department took numerous factors into
account. The Department’s objective
was to avoid unnecessary confusion and
uncertainty in the investment advice
market, facilitate continued marketplace
innovation, and minimize investor
losses while maximizing compliance
cost savings.
Compared with the alternative offered
in the NPRM, this final rule provides
more benefits. It provides more certainty
during the period between June 9, 2017
and January 1, 2018. The Department
will aim to complete its review of the
Fiduciary Rule and PTEs pursuant to
the President’s Memorandum in
advance of January 1, 2018, and to
thereby afford firms continued certainty
and enough time to prepare for
whatever action is prompted by the
review. On the cost side, as noted above,
the Department now believes that
investor losses associated with either
the NPRM approach (a 60-day delay
alone) or this final rule delaying
applicability dates would be relatively
small. As opposed to a full delay of all
conditions until January 1, 2018, this
final rule’s application of the Impartial
Conduct Standards beginning on June 9,
2017, helps ensure that retirement
investors will experience gains from a
higher conduct standard and minimizes
the potential for an undue reduction in

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those gains as compared to the full
protections of all the PTEs’ conditions.
The Department also considered the
possible impact of a 90-day or longer
delay in the application of the fiduciary
standards and all conditions set forth in
the Fiduciary Rule and PTEs. Such a
longer delay likely would result in too
little additional cost saving to justify the
additional investor losses, which could
be quite large. Under this final rule, the
Department expects that over time
investors will come to realize much of
the gains due to the Impartial Conduct
Standards. A longer delay in the
application of the Fiduciary Rule and
PTEs and those standards would
deprive investors of important fiduciary
protections for a longer time, resulting
in larger investor losses.
The Department also considered a
scenario where the fiduciary definition
in the Rule and Impartial Conduct
Standards in the PTEs take effect on
April 10, 2017 as originally planned,
while the remaining conditions in the
PTEs become applicable on January 1,
2018. This approach was suggested by
several commenters claiming that the
delay is not necessary to conduct the
examination required by the
Presidential Memorandum.23 This
approach arguably might minimize any
reduction to investor gains. The
Department did not adopt this
alternative, however, because it would
not provide the regulated community
with sufficient notice and time to
comply, and the resultant disruptions
attributable to the short time frame
could overshadow any benefits.
2. Paperwork Reduction Act
The Paperwork Reduction Act (PRA)
(44 U.S.C. 3501, et seq.) prohibits
federal agencies from conducting or
sponsoring a collection of information
from the public without first obtaining
approval from the Office of Management
and Budget (OMB). See 44 U.S.C. 3507.
Additionally, members of the public are
not required to respond to a collection
of information, nor be subject to a
penalty for failing to respond, unless
such collection displays a valid OMB
control number. See 44 U.S.C. 3512.
The Department has sent a request to
OMB to modify the information
collections contained in the Fiduciary
Rule and PTEs. The Department will
notify the public regarding OMB’s
response to its request in a separate
Federal Register Notice. The
information collection requirements
23 For example, see the commenter letter
submitted by Consumer Federation of America on
March 17, 2017.

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Federal Register / Vol. 82, No. 66 / Friday, April 7, 2017 / Rules and Regulations
contained in the Rule and PTEs are as
follows.
Final Rule: The information
collections in the Rule are approved
under OMB Control Number 1210–0155.
Paragraph (b)(2)(i) requires that certain
‘‘platform providers’’ provide disclosure
to a plan fiduciary. Paragraphs
(b)(2)(iv)(C) and (D) require asset
allocation models to contain specific
information if they furnish and provide
certain specified investment educational
information. Paragraph (c)(1) requires a
disclosure to be provided by a person to
an independent plan fiduciary in certain
circumstances for them to be deemed
not to be an investment advice
fiduciary. Finally, paragraph (c)(2)
requires certain counterparties, clearing
members and clearing organizations to
make a representation to certain parties
so they will not be deemed to be
investment advice fiduciaries regarding
certain swap transactions required to be
cleared under provisions of the DoddFrank Act.
For a more detailed discussion of the
information collections and associated
burden, see the Department’s PRA
analysis at 81 FR 20946, 20994.
PTE 2016–01, the Best Interest
Contract Exemption: The information
collections in PTE 2016–01, the BIC
Exemption, are approved under OMB
Control Number 1210–0156. The
exemption requires disclosure of
material conflicts of interest and basic
information relating to those conflicts
and the advisory relationship (Sections
II and III), contract disclosures,
contracts and written policies and
procedures (Section II), pre-transaction
(or point of sale) disclosures (Section
III(a)), web-based disclosures (Section
III(b)), documentation regarding
recommendations restricted to
proprietary products or products that
generate third party payments (Section
(IV), notice to the Department of a
Financial Institution’s intent to rely on
the PTE, and maintenance of records
necessary to prove that the conditions of
the PTE have been met (Section V).
Section IX provides a transition
period under which relief from these
prohibitions is available for Financial
Institutions and advisers during the
period between the applicability date
and January 1, 2018 (the ‘‘Transition
Period’’). As a condition of relief during
the Transition Period, Financial
Institutions were required to provide a
disclosure with a written statement of
fiduciary status and certain other
information to all retirement investors
(in ERISA plans, IRAs, and non-ERISA
plans) prior to or at the same time as the
execution of recommended transactions
(the ‘‘Transition Disclosure’’). The final

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rule eliminates and removes the burden
from the ICR for the Transition
Disclosure requirement for which the
Department estimated that 31 million
Transition Disclosures would be sent at
a cost of $42.8 million during the
transition period. This final rule
therefore removes this burden.
For a more detailed discussion of the
information collections and associated
burden, see the Department’s PRA
analysis at 81 FR 21002, 21071.
PTE 2016–02, the Prohibited
Transaction Exemption for Principal
Transactions in Certain Assets Between
Investment Advice Fiduciaries and
Employee Benefit Plans and IRAs
(Principal Transactions Exemption):
The information collections in PTE
2016–02, the Principal Transactions
Exemption, are approved under OMB
Control Number 1210–0157. The
exemption requires Financial
Institutions to provide contract
disclosures and contracts to Retirement
Investors (Section II), adopt written
policies and procedures (Section IV),
make disclosures to Retirement
Investors and on a publicly available
Web site (Section IV), maintain records
necessary to prove they have met the
PTE conditions (Section V).).
Section VII provides a transition
period under which relief from these
prohibitions is available for Financial
Institutions and advisers during the
period between the applicability date
and January 1, 2018 (the ‘‘Transition
Period’’). As a condition of relief during
the Transition Period, Financial
Institutions were required to provide a
disclosure with a written statement of
fiduciary status and certain other
information to all retirement investors
(in ERISA plans, IRAs, and non-ERISA
plans) prior to or at the same time as the
execution of recommended transactions
(the ‘‘Transition Disclosure’’). This final
rule eliminates and removes the burden
from the ICR for the Transition
Disclosure requirement for which the
Department estimated that 2.5 million
Transition Disclosures would be sent at
a cost of $2.9 million during the
Transition Period. This final rule
therefore removes this burden.
For a more detailed discussion of the
information collections and associated
burden, see the Department’s PRA
analysis at 81 FR 21089, 21129.
Amended PTE 75–1: The information
collections in Amended PTE 75–1 are
approved under OMB Control Number
1210–0092. Part V, as amended, requires
that prior to an extension of credit, the
plan must receive from the fiduciary
written disclosure of (i) the rate of
interest (or other fees) that will apply
and (ii) the method of determining the

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balance upon which interest will be
charged in the event that the fiduciary
extends credit to avoid a failed purchase
or sale of securities, as well as prior
written disclosure of any changes to
these terms. It also requires brokerdealers engaging in the transactions to
maintain records demonstrating
compliance with the conditions of the
PTE.
For a more detailed discussion of the
information collections and associated
burden, see the Department’s PRA
analysis at 81 FR 21139, 21145. The
Department concluded that the ICRs
contained in the amendments to Part V
impose no additional burden on
respondents.
Amended PTE 86–128: The
information collections in Amended
PTE 86–128 are approved under OMB
Control Number 1210–0059. As
amended, Section III of the PTE requires
Financial Institutions to make certain
disclosures to plan fiduciaries and
owners of managed IRAs in order to
receive relief from ERISA’s and the
Code’s prohibited transaction rules for
the receipt of commissions and to
engage in transactions involving mutual
fund shares. Financial Institutions
relying on either PTE 86–128 or PTE
75–1, as amended, are required to
maintain records necessary to
demonstrate that the conditions of these
PTEs have been met.
For a more detailed discussion of the
information collections and associated
burden, see the Department’s PRA
analysis at 81 FR 21181, 21199.
Amended PTE 84–24: The
information collections in Amended
PTE 84–24 are approved under OMB
Control Number 1210–0158. As
amended, Section IV(b) of PTE 84–24
requires Financial Institutions to obtain
advance written authorization from an
independent plan fiduciary or IRA
holder and furnish the independent
fiduciary or IRA holder with a written
disclosure in order to receive
commissions in conjunction with the
purchase of insurance and annuity
contracts. Section IV(c) of PTE 84–24
requires investment company Principal
Underwriters to obtain approval from an
independent fiduciary and furnish the
independent fiduciary with a written
disclosure in order to receive
commissions in conjunction with the
purchase by a plan of securities issued
by an investment company Principal
Underwriter. Section V of PTE 84–24, as
amended, requires Financial Institutions
to maintain records necessary to
demonstrate that the conditions of the
PTE have been met.
The final rule delays the applicability
of amendments to PTE 84–24 until

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January 1, 2018, except that the
Impartial Conduct Standards will
become applicable on June 9, 2017. The
Department does not have sufficient
data to estimate that number of
respondents that will use PTE–84–24
with the inclusion of Impartial Conduct
Standards but delayed applicability date
of amendments. Therefore, the
Department has not revised its estimate
from the proposed rule.
For a more detailed discussion of the
information collections and associated
burden, see the Department’s PRA
analysis at 81 FR 21147, 21171.
These paperwork burden estimates,
which are substantially derived from
compliance with conditions that will
apply after January 1, 2018, over the
three-year ICR approval period, are
summarized as follows:
Agency: Employee Benefits Security
Administration, Department of Labor.
Titles: (1) Best Interest Contract
Exemption and (2) Final Investment
Advice Regulation.
OMB Control Number: 1210–0156.
Affected Public: Businesses or other
for-profits; not for profit institutions.
Estimated Number of Respondents:
19,890.
Estimated Number of Annual
Responses: 34,095,501 during the first
year and 72,282,441 during subsequent
years.
Frequency of Response: When
engaging in exempted transaction.
Estimated Total Annual Burden
Hours: 2,701,270 during the first year
and 2,832,369 in subsequent years.
Estimated Total Annual Burden Cost:
$2,436,741,143 during the first year and
$574,302,408 during subsequent years.
Agency: Employee Benefits Security
Administration, Department of Labor.
Titles: (1) Prohibited Transaction
Exemption for Principal Transactions in
Certain Assets between Investment
Advice Fiduciaries and Employee
Benefit Plans and IRAs and (2) Final
Investment Advice Regulation.
OMB Control Number: 1210–0157.
Affected Public: Businesses or other
for-profits; not for profit institutions.
Estimated Number of Respondents:
6,075.
Estimated Number of Annual
Responses: 2,463,803 during the first
year and 3,018,574 during subsequent
years.
Frequency of Response: When
engaging in exempted transaction;
Annually.
Estimated Total Annual Burden
Hours: 85,457 hours during the first year
and 56,197 hours in subsequent years.
Estimated Total Annual Burden Cost:
$1,953,184,167 during the first year and
$431,468,619 in subsequent years.

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3. Regulatory Flexibility Act
The Regulatory Flexibility Act (5
U.S.C. 601 et seq.) (RFA) imposes
certain requirements with respect to
Federal Rules that are subject to the
notice and comment requirements of
section 553(b) of the Administrative
Procedure Act (5 U.S.C. 551 et seq.) or
any other laws. Unless the head of an
agency certifies that a proposed Rule is
not likely to have a significant economic
impact on a substantial number of small
entities, section 604 of the RFA requires
that the agency present a final
regulatory flexibility analysis (FRFA)
describing the Rule’s impact on small
entities and explaining how the agency
made its decisions with respect to the
application of the Rule to small entities.
Small entities include small businesses,
organizations and governmental
jurisdictions.
The Department has determined that
this final rule will have a significant
economic impact on a substantial
number of small entities, and hereby
provides this FRFA. As noted above, the
Department is taking regulatory action
to delay the applicability date of the
fiduciary definition in the Rule and
Impartial Conduct Standards in the
PTEs until June 9, 2017, and remaining
conditions for covered transactions in
the BIC Exemption and Principal
Transactions Exemption until January 1,
2018. In addition, the Department is
delaying the applicability of
amendments to Prohibited Transaction
Exemption 84–24 until January 1, 2018,
other than the Impartial Conduct
Standards, which will become
applicable on June 9, 2017. This final
rule is intended to reduce any
unnecessary disruption that could occur
in the marketplace if the applicability
date of the Rule and PTEs occurs while
the Department examines the Rule and
PTEs as directed in the Presidential
Memorandum. In the face of uncertainty
and widespread questions about the
Fiduciary Rule’s future or possible
repeal, many financial firms slowed or
halted their efforts to prepare for full
compliance on April 10. Consequently,
failure to delay that applicability date
could jeopardize firms’ near-term ability
and/or propensity to serve classes of
customers, and both firms and investors
could suffer.
The Small Business Administration
(SBA) defines a small business in the
Financial Investments and Related
Activities Sector as a business with up
to $38.5 million in annual receipts. The
Department examined the dataset
obtained from SBA which contains data
on the number of firms by NAICS codes,
including the number of firms in given

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revenue categories. This dataset allowed
the Department to estimate the number
of firms with a given NAICS code that
falls below the $38.5 million threshold
to be considered a small entity by the
SBA. However, this dataset alone does
not provide a sufficient basis for the
Department to estimate the number of
small entities affected by the rule. Not
all firms within a given NAICS code
would be affected by this rule, because
being an ERISA fiduciary relies on a
functional test and is not based on
industry status as defined by a NAICS
code. Further, not all firms within a
given NAICS code work with ERISAcovered plans and IRAs.
Over 90 percent of broker-dealers
(BDs), registered investment advisers,
insurance companies, agents, and
consultants are small businesses
according to the SBA size standards (13
CFR 121.201). Applying the ratio of
entities that meet the SBA size
standards to the number of affected
entities, based on the methodology
described at greater length in the RIA of
the Fiduciary Rule, the Department
estimates that the number of small
entities affected by this final rule is
2,438 BDs, 16,521 Registered Investment
Advisors, 496 insurers, and 3,358 other
ERISA service providers. For purposes
of the RFA, the Department continues to
consider an employee benefit plan with
fewer than 100 participants to be a small
entity. The 2013 Form 5500 filings show
nearly 595,000 ERISA covered
retirement plans with less than 100
participants.
Based on the foregoing, the
Department estimates that small entities
would save approximately $74.1 million
in compliance costs due to the delays of
the applicability dates described in this
document.24 This estimate is a subset of
the cost savings discussed in the RIA,
but is an estimate of cost savings only
for small entities. As highlighted in the
Final Regulatory Flexibility Act
Analysis for the Fiduciary Rule, 96.2,
97.3, and 99.3 percent of BDs,
Registered Investment Advisors, and
Insurers respectively are estimated to
meet the SBAs definition of small
business. These cost savings are
substantially derived from foregone ongoing compliance requirements related
to the transition notice requirements for
the BIC Exemption and the Principal
Transactions Exemption, data collection
to demonstrate satisfaction of fiduciary
requirements, and retention of data to
demonstrate the satisfaction of
24 This estimate includes savings from notice
requirements. Savings from notice requirements
include savings from all firms because it is difficult
to break out cost savings only from small entities
as defined by SBA.

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Federal Register / Vol. 82, No. 66 / Friday, April 7, 2017 / Rules and Regulations
conditions of the exemption during the
Transition Period.
As discussed above, most firms
affected by this final rule meet the
SBA’s definition of a small business.
Therefore, the discussion of the
comments received on the proposed
rule in Section B. and alternatives in
Section C.1.c, is relevant and crossreferred to for purpose of this
Regulatory Flexibility Act analysis.

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4. Congressional Review Act
The final rule extending the
applicability date is subject to the
Congressional Review Act (CRA)
provisions of the Small Business
Regulatory Enforcement Fairness Act of
1996 (5 U.S.C. 801 et seq.) and will be
transmitted to Congress and the
Comptroller General for review. The
final rule is a ‘‘major rule’’ as that term
is defined in 5 U.S.C. 804, because it is
likely to result in an annual effect on the
economy of $100 million or more.
Although the CRA generally requires
that major rules become effective no
sooner than 60 days after Congress
receives the required report, the CRA
allows the issuing agency to make a rule
effective sooner, if the agency makes a
good cause finding that such public
procedure is impracticable,
unnecessary, or contrary to the public
interest. The Department has made such
a good cause finding for this rule (as
discussed in further detail below in
Section C.6 of this document), including
the basis for that finding. The
Presidential Memorandum, directing the
Department to conduct an updated legal
and economic analysis, was issued on
February 3, 2017, only 67 days before
the Rule and PTEs were scheduled to
become applicable. The Department has
determined it would be impracticable
for it to conclude any delay of this
rulemaking more than 60 days before
the April 10, 2017 applicability date.
5. Unfunded Mandates Reform Act
Title II of the Unfunded Mandates
Reform Act of 1995 (Pub. L. 104–4)
requires each Federal agency to prepare
a written statement assessing the effects
of any Federal mandate in a proposed or
final agency rule that may result in an
expenditure of $100 million or more
(adjusted annually for inflation with the
base year 1995) in any one year by State,
local, and tribal governments, in the
aggregate, or by the private sector. For
purposes of the Unfunded Mandates
Reform Act, as well as Executive Order
12875, the final rule extending the
applicability date does not include any
federal mandate that we expect would
result in such expenditures by State,
local, or tribal governments, or the

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private sector. The Department also
does not expect that the delay will have
any material economic impacts on State,
local or tribal governments, or on
health, safety, or the natural
environment.
6. Effective Date and Good Cause Under
553(d)(1), (3)
The extension of the applicability
date of the Rule and PTEs is effective
immediately upon publication of the
final rule in the Federal Register. Under
5 U.S.C. 553(d) (Administrative
Procedure Act), an agency may
determine that its rulemaking should
become effective more quickly than the
30 days after publication that is
otherwise required. This is appropriate
if the rule relieves a restriction, or if the
agency finds, and publishes, good cause
to accelerate the effective date. The
Department has determined that a delay
of the applicability date of the Rule and
PTEs relieves a restriction and therefore
may appropriately become effective
immediately. Additionally, for all of the
reasons set forth in Sections B and C,
the Department has determined that
there is good cause for making the rule
effective immediately. The APA
provision is intended to ensure that
affected parties have a reasonable
amount of time to adjust their behavior
to comply with new regulatory
requirements. This final rule, which
delays for 60 days regulatory
requirements that would otherwise
apply as of April 10, 2017, fulfills that
purpose. Moreover, if the final rule’s 60day delay were not immediately
effective, significant provisions of the
Rule and PTEs could become applicable
on April 10 before the delay takes effect,
resulting in a period in which the Rule,
fiduciary obligations, and notice and
disclosure requirements would become
applicable before becoming inapplicable
again. Such a gap period would result
in a chaotic transition to fiduciary
standards that would create additional
confusion, uncertainty, and expense,
thereby defeating the purposes of the
delay. The resulting disorder would be
contrary to principles of fundamental
fairness and could increase costs, not
only for firms and advisers, but for the
retirement investors that they serve. The
Department also believes that making
the rule immediately effective will
provide plans, plan fiduciaries, plan
participants and beneficiaries, IRAs,
IRA owners, financial services providers
and other affected service providers the
level of certainty that the rule is final
and not subject to further modification
without additional public notice and
comment that will allow them to
immediately resume and/or complete

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preparations for the provisions of the
Rule and PTEs that will become
applicable on June 9, 2017. Accordingly,
the Department has concluded that
providing certainty, by making the delay
effective immediately, would be a more
reasonable and fair path forward. In
addition, the Presidential Memorandum
ordering the Department to reconsider
its legal and economic analysis was
issued only 67 days before the
applicability date and generated a high
volume of comments; it would have
been impracticable for the Department
to finish any public rulemaking process
quickly enough to provide an effective
date 30 days after publication.
7. Reducing Regulation and Controlling
Regulatory Costs
Executive Order 13771, titled
Reducing Regulation and Controlling
Regulatory Costs, was issued on January
30, 2017. Section 2(a) of Executive
Order 13771 requires an agency, unless
prohibited by law, to identify at least
two existing regulations to be repealed
when the agency publicly proposes for
notice and comment, or otherwise
promulgates, a new regulation. In
furtherance of this requirement, section
2(c) of Executive Order 13771 requires
that the new incremental costs
associated with new regulations shall, to
the extent permitted by law, be offset by
the elimination of existing costs
associated with at least two prior
regulations. OMB’s interim guidance,
issued on February 2, 2017, explains
that for Fiscal Year 2017 the above
requirements only apply to each new
‘‘significant regulatory action that
imposes costs,’’ and that ‘‘costs should
be measured as the opportunity cost to
society.’’ The impacts of today’s final
rule are categorized consistently with
the analysis of the original Fiduciary
Rule, and the Department has also
concluded that the impacts identified in
the Regulatory Impact Analysis
accompanying the 2016 final rule may
still be used as a basis for estimating the
potential impacts of that final rule, were
it not being modified today. It has been
determined that, for purposes of E.O.
13771, the impacts of the Fiduciary Rule
that were identified in the 2016 analysis
as costs, and are reduced by today’s
final rule, are presently categorized as
cost savings (or negative costs), and
impacts of the Fiduciary Rule that were
identified in the 2016 analysis as a
combination of transfers and positive
benefits, and that are reduced by today’s
final rule, are categorized as a
combination of (opposite-direction)
transfers and negative benefits.
Accordingly, OMB has determined that
this final rule extending the

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applicability date does not impose costs
that would trigger the above
requirements of Executive Order 13771.

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D. Supplemental Description of PTEs
Available to Investment Advisers
When it adopted the Fiduciary Rule
in 2016, the Department also granted the
new BIC Exemption 25 and Principal
Transactions Exemption,26 to facilitate
the provision of investment advice in
retirement investors’ best interest. In the
absence of an exemption, investment
advice fiduciaries would be statutorily
prohibited under ERISA and the Code
from receiving compensation as a result
of their investment advice, and from
engaging in certain other transactions,
involving plan and IRA customers.
These new exemptions provided broad
relief from the prohibited transaction
provisions for investment advice
fiduciaries operating in the retail
marketplace. The Department also
expanded an existing exemption to
permit investment advice fiduciaries to
receive compensation for extending
credit to avoid failed securities
transactions. See PTE 75–1, Part V.27
At the same time that it granted the
new exemptions, the Department
amended a number of previously
granted exemptions to incorporate the
Impartial Conduct Standards as
conditions. In some cases, previously
granted exemptions were revoked or
were narrowed in scope, with the aim
that investment advice fiduciaries
would rely primarily on the BIC
Exemption and Principal Transactions
Exemption when they provided advice
to retirement investors in the retail
marketplace. These amendments were,
as a whole, intended to ensure that
retirement investors would consistently
be protected by Impartial Conduct
Standards, regardless of the particular
exemption upon which an investment
advice fiduciary relies.
As discussed in Sections B and C
above, the Department has determined
that the Impartial Conduct Standards in
the new exemptions and amendments to
previously granted exemptions should
become applicable on June 9, 2017, so
that retirement investors will be
protected during the period in which
the Department conducts its
examination of the Fiduciary Rule.
Accordingly, this document extends for
60 days the applicability dates of the
25 81 FR 21002 (April 8, 2016), as corrected at 81
FR 44773 (July 11, 2016).
26 81 FR 21089 (April 8, 2016), as corrected at 81
FR 44784 (July 11, 2016).
27 Exemptions from Prohibitions Respecting
Certain Classes of Transactions Involving Employee
Benefit Plans and Certain Broker-Dealers, Reporting
Dealers and Banks, 81 FR 21139 (April 8, 2016).

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BIC Exemption and the Principal
Transactions Exemption and requires
adherence to the Impartial Conduct
Standards (including the ‘‘best interest’’
standard) only, as conditions of the
transition period through January 1,
2018. Thus, the fiduciary definition in
the Rule published on April 8, 2016,
and Impartial Conduct Standards in
these exemptions, are applicable on
June 9, 2017, while compliance with
other conditions for covered
transactions, such as the contract
requirement, in these exemptions is not
required until January 1, 2018. This
document also delays the applicability
of amendments to Prohibited
Transaction Exemption 84–24 until
January 1, 2018, other than the Impartial
Conduct Standards, which will become
applicable on June 9, 2017. Finally, this
document extends the applicability
dates of amendments to other
previously granted exemptions to June
9, 2017. Taken together, these
exemptions provide broad relief to
fiduciary advisers, all of whom will be
subject to the Impartial Conduct
Standards under the exemptions’ terms.
A brief description of the exemptions,
and their applicability dates, follows.
BIC Exemption and Principal
Transactions Exemption
Both the BIC Exemption and the
Principal Transactions Exemption will
become applicable on June 9, 2017. The
periods of transition relief (Section IX of
the BIC Exemption and Section VII of
the Principal Transactions Exemption)
are amended to extend from June 9,
2017, through January 1, 2018. The
Impartial Conduct Standards set forth in
the transition relief are applicable June
9, 2017. In addition, Section II(h) of the
BIC Exemption is amended to delay
conditions for robo-advice providers
that are Level Fee Fiduciaries other than
the Impartial Conduct Standards, which
are applicable on June 9, 2017; these
entities are excluded from relief in
Section IX but the Department
determined that the transition relief
should apply to them as well. The
preambles to the BIC Exemption (81 FR
21026–32) and the Principal
Transactions Exemption (81 FR 21105–
09) provide an extensive discussion of
the Impartial Conduct Standards of each
exemption.
The remaining conditions of Section
IX of the BIC Exemption and Section VII
of the Principal Transactions
Exemption, other than the Impartial
Conduct Standards, will not be
applicable during the Transition

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Period.28 These conditions would have
required a written statement of fiduciary
status, specified disclosures, and a
written commitment to adhere to the
Impartial Conduct Standards;
designation of a person or persons
responsible for addressing material
conflicts of interest and monitoring
advisers’ adherence to the Impartial
Conduct Standards; and compliance
with the recordkeeping requirements of
the exemptions. Absent additional
changes to the Exemptions, these
conditions (and others) will first become
applicable on January 1, 2018, after the
Transition Period closed. See BIC
Exemption Sections II(b), II(c), II(d)(2),
II(e) and V; Principal Transactions
Exemption Sections II(b), II(c), II(d)(2),
II(e) and V.
PTE 84–24
PTE 84–24 29 is a previously granted
exemption for transactions involving
insurance and annuity contracts, which
was amended in April 2016 to include
the Impartial Conduct Standards as
conditions and to revoke relief for
annuity contracts other than ‘‘fixed rate
annuity contracts.’’ 30 By the
amendment’s terms, the exemption
would no longer apply to transactions
involving fixed indexed annuity
contracts and variable annuity contracts
as of April 10, 2017.
The Department is now delaying the
applicability date of the April 2016
Amendments to PTE 84–24 until
January 1, 2018, except for the Section
II. Impartial Conduct Standards and the
related definitions of ‘‘Best Interest’’ and
‘‘Material Conflict of Interest,’’ which
will become applicable on June 9,
2017.31 Therefore, from June 9, 2017,
until January 1, 2018, insurance agents,
insurance brokers, pension consultants
and insurance companies will be able to
continue to rely on PTE 84–24, as
previously written,32 for the
recommendation and sale of fixed
indexed, variable, and other annuity
contracts to plans and IRAs,33 subject to
28 See Sections IX(d)(2)–(4) of the BIC Exemption
and Sections VII(d)(2)-(4) of the Principal
Transactions Exemption.
29 Prohibited Transaction Exemption 84–24 for
Certain Transactions Involving Insurance Agents
and Brokers, Pension Consultants, Insurance
Companies and Investment Company Principal
Underwriters, 49 FR 13208 (April 3, 1984), as
corrected 49 FR 24819 (June 15, 1984), as amended
71 FR 5887 (Feb. 3, 2006), and as amended 81 FR
21147 (April 8, 2016).
30 The term ‘‘Fixed Rate Annuity Contract’’ is
defined in Section VI(k) of the amended exemption.
31 See 81 FR 21176 (Apr. 8, 2016), PTE 84–24
Section VI(b) (defining Best Interest) and Section
VI(h) (defining Material Conflict of Interest).
32 See 71 FR 5887 (Feb. 3, 2006).
33 See PTE 2002–13, 67 FR 9483 (March 1, 2002)
(preamble discussion of certain exemptions,

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the addition of the Impartial Conduct
Standards.34
The purpose of this partial delay of
the amendment’s applicability date is to
minimize any concerns about potential
disruptions in the insurance industry
during the transition period and
consideration of the Presidential
Memorandum. While the Department
believes that most parties receiving
compensation in connection with
annuity recommendations can readily
rely on the broad transition exemption
in the BIC Exemption, discussed above,
some parties have expressed a
preference to continue to rely on PTE
84–24, as amended in 2006, which has
historically been available to the
insurance industry for all types of
annuity products. The Department notes
that it is considering, but has not yet
finalized, additional exemptive relief
that is relevant to the insurance industry
in determining its approach to
complying with the Fiduciary Rule. See
Proposed BIC Exemption for Insurance
Intermediaries.35

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PTE 86–128 and PTE 75–1, Parts I and
II
In April 2016, the Department also
amended PTE 86–128, which permits
fiduciaries to receive compensation in
connection with certain securities
transactions, to require fiduciaries
relying on the exemption to comply
with the Impartial Conduct Standards,
and revoked relief for investment advice
fiduciaries to IRAs who would now rely
on the BIC Exemption, rather than PTE
86–128. In addition, the Department
revoked PTE 75–1, Part II(2), which had
granted relief for certain mutual fund
purchases between fiduciaries and
plans, and amended PTE 86–128 to
provide similar relief, subject to the
additional conditions of PTE 86–128,
including the Impartial Conduct
Standards. Rather than becoming
applicable on April 10, 2017, as
provided by the April 2016 rulemaking,
these amendments will now become
applicable on June 9, 2017, reflecting a
sixty day extension. In addition, the
transition exemption in the BIC
Exemption will be broadly available to
investment advice fiduciaries engaging
including PTE 84–24, that apply to plans described
in Code section 4975).
34 The Impartial Conduct Standards are redesignated as Section VII of the 2006 exemption.
PTE 84–24 also historically provided relief for
certain transactions involving mutual fund
principal underwriters that was revoked for
transactions involving IRAs. The applicability date
of that revocation is also delayed until January 1,
2018; accordingly, such transactions can continue
until that time subject to the applicability of the
Impartial Conduct Standards.
35 82 FR 7336 (January 19, 2017).

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in the transactions permitted by PTE
86–128.
The April 2016 amendments also
provided for the revocation of PTE 75–
1, Part I, which provides an exemption
for non-fiduciaries to perform certain
services in connection with securities
transactions. As discussed in the
preamble to the amendments, the relief
provided by PTE 75–1, Part I was
duplicative of the statutory exemptions
for service providers set forth in ERISA
section 408(b)(2) and Code section
4975(d)(2).36 Rather than becoming
applicable on April 10, 2017, as
provided in the April 2016 rulemaking,
these amendments will now become
applicable in their entirety on June 9,
2017, reflecting a sixty day extension.
For a full discussion of the 2016
amendments to PTE 86–128 and 75–1,
Parts I and II, see 81 FR 21181.
PTEs 75–1, Parts III and IV, 77–4, 80–
83 and 83–1
The Department amended the
following previously granted
exemptions to require fiduciaries
relying on the exemptions to comply
with the Impartial Conduct Standards.37
Because consistent application of the
Impartial Conduct Standards is the
Department’s objective, these
amendments will be delayed 60 days
and become applicable June 9, 2017.
• PTE 75–1, Part III and IV,
Exemptions from Prohibitions
Respecting Certain Classes of
Transactions Involving Employee
Benefit Plans and Certain BrokerDealers, Reporting Dealers and Banks.
• PTE 77–4, Class Exemption for
Certain Transactions Between
Investment Companies and Employee
Benefit Plans.
• PTE 80–83, Class Exemption for
Certain Transactions Involving Purchase
of Securities Where Issuer May Use
Proceeds to Reduce or Retire
Indebtedness to Parties in Interest.
• PTE 83–1 Class Exemption for
Certain Transactions Involving Mortgage
Pool Investment Trusts.
For a full discussion of these
amendments, see 81 FR 21208.
PTE 75–1, Part V
In April 2016, the Department
amended PTE 75–1, Part V, to permit
investment advice fiduciaries to receive
compensation for extending credit to a
plan or IRA to avoid a failed securities
transaction. Thus, the amendment
expanded the scope of the existing
exemption and allowed investment
advice fiduciaries to receive
36 81
37 81

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FR 21208 (April 8, 2016).

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16917

compensation for such transactions,
provided they make certain disclosures
in advance regarding the interest that
will be charged. The amendment will be
useful to fiduciaries that are newlycovered under the Rule, which will
become applicable on June 9, 2017, after
a sixty day extension. Accordingly, this
amendment too will become applicable
on June 9, 2017. For a full discussion of
the amendment, see 81 FR 21139.
E. List of Amendments to the
Applicability Dates of the Prohibited
Transaction Exemptions
Following are amendments to the
applicability dates of the BIC Exemption
and other PTEs adopted and amended
in connection with the Fiduciary Rule
defining who is a fiduciary for purposes
of ERISA and the Code. The
amendments are effective as of April 10,
2017. For the convenience of users, the
text of the BIC Exemption, the Principal
Transactions Exemption, and PTE84–24,
as amended on this date, appear restated
in full on EBSA’s Web site. The
Department finds that the exemptions
with the amended applicability dates
are administratively feasible, in the
interests of plans, their participants and
beneficiaries and IRA owners, and
protective of the rights of plan
participants and beneficiaries and IRA
owners.
1. The BIC Exemption (PTE 2016–01)
is amended as follows:
A. The date ‘‘April 10, 2017’’ is
deleted and ‘‘June 9, 2017’’ is inserted
in its place as the Applicability date in
the introductory DATES section of the
exemption.
B. Section II(h)—Level Fee Fiduciaries
provides streamlined conditions for
‘‘Level Fee Fiduciaries.’’ In accordance
with the exemption’s Applicability
Date, these conditions—including the
Impartial Conduct Standards set forth in
Section II(h)(2)—are applicable on June
9, 2017, but they are not required for
parties that can comply with Section IX.
For Level Fee Fiduciaries that are roboadvice providers, and therefore not
eligible for Section IX, the Impartial
Conduct Standards in Section II(h)(2)
are applicable June 9, 2017 but the
remaining conditions of Section II(h) are
applicable January 1, 2018. The
amended applicability dates are
reflected in new Section II(h)(4).
C. Section IX—Transition Period for
Exemption provides an exemption for
the Transition Period, subject to
conditions set forth in Section IX(d).
The Transition Period identified in
Section IX(a) is amended to extend from
June 9, 2017, to January 1, 2018, rather
than April 10, 2017, to January 1, 2018.
Section IX(d)(1), which sets forth

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Impartial Conduct Standards, is
applicable June 9, 2017. The remaining
conditions of Section IX(d) are not
applicable in the Transition Period.
These conditions are also required in
Sections II and V of the exemption,
which will apply after the Transition
Period.
2. The Class Exemption for Principal
Transactions in Certain Assets Between
Investment Advice Fiduciaries and
Employee Benefit Plans and IRAs (PTE
2016–02), is amended as follows:
A. The date ‘‘April 10, 2017’’ is
deleted and ‘‘June 9, 2017’’ is inserted
in its place as the Applicability date in
the introductory DATES section,
B. Section VII—Transition Period for
Exemption sets forth an exemption for
the Transition Period subject to
conditions set forth in Section VII(d).
The Transition Period identified in
Section VII(a) is amended to extend
from June 9, 2017, to January 1, 2018,
rather than April 10, 2017, to January 1,
2018. Section VII(d)(1), which sets forth
Impartial Conduct Standards, is
applicable June 9, 2017. The remaining
conditions of Section VII(d) are not
applicable in the Transition Period.
These conditions are also required in
Sections II and V of the exemption,
which will apply after the Transition
Period.
3. Prohibited Transaction Exemption
84–24 for Certain Transactions
Involving Insurance Agents and Brokers,
Pension Consultants, Insurance
Companies, and Investment Company
Principal Underwriters, is amended as
follows:
A. The date ‘‘April 10, 2017’’ is
replaced with ‘‘January 1, 2018’’ as the
Applicability date in the introductory
DATES section of the amendment, except
as it applies to Section II. Impartial
Conduct Standards, and Sections VI(b)
and (h), which define ‘‘Best Interest,’’
and ‘‘Material Conflicts of Interest,’’ all
of which are applicable June 9, 2017.
B. Section II—Impartial Conduct
Standards, is redesignated as Section
VII. The introductory clause is amended
to reflect the June 9, 2017 applicability
date of that section, as follows: ‘‘On or
after June 9, 2017, if the insurance agent
or broker, pension consultant, insurance
company or investment company
Principal Underwriter is a fiduciary
within the meaning of ERISA section
3(21)(A)(ii) or Code section
4975(e)(3)(B) with respect to the assets
involved in the transaction, the
following conditions must be satisfied,
with respect to the transaction to the
extent they are applicable to the
fiduciary’s actions[.]’’
C. The definition of ‘‘Best Interest,’’ is
redesignated as Section VI(h) and the

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definition of ‘‘Material Conflict of
Interest’’ is redesignated as Section
VI(i).
4. The following exemptions are
amended by deleting the date ‘‘April 10,
2017’’ and replacing it with ‘‘June 9,
2017,’’ as the Applicability date in the
introductory DATES section:
A. Prohibited Transaction Exemption
86–128 for Securities Transactions
Involving Employee Benefit Plans and
Broker-Dealers and Prohibited
Transaction Exemption 75–1,
Exemptions from Prohibitions
Respecting Certain Classes of
Transactions Involving Employee
Benefit Plans and Certain BrokerDealers, Reporting Dealers and Banks,
Parts I and II;
B. Prohibited Transaction Exemption
75–1, Exemptions from Prohibitions
Respecting Certain Classes of
Transactions Involving Employee
Benefit Plans and Certain BrokerDealers, Reporting Dealers and Banks,
Parts III and IV;
C. Prohibited Transaction Exemption
77–4, Class Exemption for Certain
Transactions Between Investment
Companies and Employee Benefit Plans;
D. Prohibited Transaction Exemption
80–83, Class Exemption for Certain
Transactions Involving Purchase of
Securities Where Issuer May Use
Proceeds to Reduce or Retire
Indebtedness to Parties in Interest; and
E. Prohibited Transaction Exemption
83–1 Class Exemption for Certain
Transactions Involving Mortgage Pool
Investment Trusts.
F. Prohibited Transaction Exemption
75–1, Exemptions from Prohibitions
Respecting Certain Classes of
Transactions Involving Employee
Benefit Plans and Certain BrokerDealers, Reporting Dealers and Banks,
Part V.
List of Subjects in 29 CFR Parts 2510
Employee benefit plans, Exemptions,
Fiduciaries, Investments, Pensions,
Prohibited transactions, Reporting and
recordkeeping requirements, Securities.
For the reasons set forth above, the
Department amends part 2510 of
subchapter B of chapter XXV of title 29
of the Code of Federal Regulations as
follows:
SUBCHAPTER B—DEFINITIONS AND
COVERAGE UNDER THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF
1974

PART 2510—DEFINITIONS OF TERMS
USED IN SUBCHAPTERS C, D, E, F, G,
AND L OF THIS CHAPTER
1. The authority citation for part 2510
is revised to read as follows:

■

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Authority: 29 U.S.C. 1002(2), 1002(21),
1002(37), 1002(38), 1002(40), 1031, and 1135;
Secretary of Labor’s Order No. 1–2011, 77 FR
1088 (Jan. 9, 2012); Secs. 2510.3–21, 2510.3–
101 and 2510.3–102 also issued under sec.
102 of Reorganization Plan No. 4 of 1978, 5
U.S.C. App. at 237 (2012), E.O. 12108, 44 FR
1065 (Jan. 3, 1979) and 29 U.S.C. 1135 note.
Sec. 2510.3–38 is also issued under sec. 1,
Pub. L. 105–72, 111 Stat. 1457 (1997).
§ 2510.3–21

[Amended]

2. Section 2510.3–21 is amended in
paragraphs (h)(2), (j)(1) introductory
text, and (j)(3) by removing the date
‘‘April 10, 2017’’ and adding in its place
‘‘June 9, 2017’’.

■

Signed at Washington, DC, this 3rd day of
April, 2017.
Timothy D. Hauser,
Deputy Assistant Secretary for Program
Operations, Employee Benefits Security
Administration, Department of Labor.
[FR Doc. 2017–06914 Filed 4–4–17; 4:15 pm]
BILLING CODE 4510–29–P

DEPARTMENT OF HOMELAND
SECURITY
Coast Guard
33 CFR Part 117
[Docket No. USCG–2017–0270]

Drawbridge Operation Regulation;
Cerritos Channel, Long Beach, CA
Coast Guard, DHS.
Notice of deviation from
drawbridge regulation.

AGENCY:
ACTION:

The Coast Guard has issued a
temporary deviation from the operating
schedule that governs the Henry Ford
Avenue railroad bridge across Cerritos
Channel, mile 4.8 at Long Beach, CA.
The deviation is necessary to allow the
bridge owner to replace the operating
machinery of the bridge. This deviation
allows the bridge to remain in the
closed-to-navigation position during the
deviation period.
DATES: This deviation is effective from
6 a.m. on April 24, 2017 to 6:30 p.m. on
May 27, 2017.
ADDRESSES: The docket for this
deviation, [USCG–2017–0270], is
available at http://www.regulations.gov.
Type the docket number in the
‘‘SEARCH’’ box and click ‘‘SEARCH’’.
Click on Open Docket Folder on the line
associated with this deviation.
FOR FURTHER INFORMATION CONTACT: If
you have questions on this temporary
deviation, call or email David H.
Sulouff, Chief, Bridge Section, Eleventh
Coast Guard District; telephone 510–
SUMMARY:

E:\FR\FM\07APR1.SGM

07APR1