EBSA Delays Applicability Date of Benefit Plan Disclosure Rule

The DOL’s Employee Benefits Security Administration (EBSA) has announced that it is pushing back the applicability date of the new benefit plan disclosure rule from July 16, 2011 to January 1, 2012. First published on July 16, 2010, the interim rule requires certain service providers to employee pension benefit plans to disclose information that would enable plan fiduciaries to better assess the reasonableness of the fees being charged for plan services and to target potential conflicts of interest. The requirements now apply to plan contracts or arrangements for services in existence on or after January 1, 2012. According to the DOL’s press release, the purpose of the change is to give plans and their service providers sufficient time to comply with a final rule, which has yet to be issued. The EBSA’s Assistant Secretary Phyllis C. Borzi states that:

The department intended to have final rules in place sufficiently in advance of the July 16 applicability date to avoid compliance problems for both plans and their service providers.  Given the need to ensure a careful review of all the valuable input we received on the interim final rule, including suggestions for a summary document to further assist plan fiduciaries in their review of furnished information, we now believe plans and plan service providers would benefit from an extension of the rules applicability date.

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Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.