ERISA-DOL Again Delays The Effective Date Of The Investment Advice Rules

Back on January 21, 2009, the Department of Labor (“DOL”) published final rules on the provisions of ERISA and the Internal Revenue Code (the “Code”) which permit investment advice to be given to participants and beneficiaries in participant-directed individual account plans, such as 401(k) plans, and to beneficiaries of IRAs and similar arrangements. The rules implement a statutory prohibited transaction exemption under Sections 408(b)(14) and 408(g) of ERISA, and under Section 4975 of the Code, and also contain an administrative class exemption granting additional relief. The effective date of these rules had been deferred until November 18, 2009. Now, the DOL has published a notice which further postpones the effective date of these rules until May 17, 2010, to give the DOL additional time to consider the questions of law and policy that have arisen about the rules.

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