ERISA Procedure 76-1; Advisory Opinion Procedure

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

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

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