Exemptions From Certain Prohibited Transaction Restrictions, 19924-19928 [2014-07984]
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19924
Federal Register / Vol. 79, No. 69 / Thursday, April 10, 2014 / Notices
The
OWCP administers the Longshore and
Harbor Workers’ Compensation Act. The
Act provides benefits to workers injured
in maritime employment on the
navigable waters of the United States or
in an adjoining area customarily used by
an employer in loading, unloading,
repairing, or building a vessel. The Act
provides that reasonable funeral
expenses, not to exceed $3,000, shall be
paid in all compensable death cases.
The OWCP has developed Form LS–265
for use in submitting the funeral
expenses for payment.
This information collection is subject
to the PRA. A Federal agency generally
cannot conduct or sponsor a collection
of information, and the public is
generally not required to respond to an
information collection, unless it is
approved by the OMB under the PRA
and displays a currently valid OMB
Control Number. In addition,
notwithstanding any other provisions of
law, no person shall generally be subject
to penalty for failing to comply with a
collection of information that does not
display a valid Control Number. See 5
CFR 1320.5(a) and 1320.6. The DOL
obtains OMB approval for this
information collection under Control
Number 1240–0040.
OMB authorization for an ICR cannot
be for more than three (3) years without
renewal, and the current approval for
this collection is scheduled to expire on
April 30, 2014. The DOL seeks to extend
PRA authorization for this information
collection for three (3) more years,
without any change to existing
requirements. The DOL notes that
existing information collection
requirements submitted to the OMB
receive a month-to-month extension
while they undergo review. For
additional substantive information
about this ICR, see the related notice
published in the Federal Register on
December 20, 2013 (78 FR 77169).
Interested parties are encouraged to
send comments to the OMB, Office of
Information and Regulatory Affairs at
the address shown in the ADDRESSES
section within 30 days of publication of
this notice in the Federal Register. In
order to help ensure appropriate
consideration, comments should
mention OMB Control Number 1240–
0040. The OMB is particularly
interested in comments that:
• Evaluate whether the proposed
collection of information is necessary
for the proper performance of the
functions of the agency, including
whether the information will have
practical utility;
• Evaluate the accuracy of the
agency’s estimate of the burden of the
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SUPPLEMENTARY INFORMATION:
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proposed collection of information,
including the validity of the
methodology and assumptions used;
• Enhance the quality, utility, and
clarity of the information to be
collected; and
• Minimize the burden of the
collection of information on those who
are to respond, including through the
use of appropriate automated,
electronic, mechanical, or other
technological collection techniques or
other forms of information technology,
e.g., permitting electronic submission of
responses.
Agency: DOL–OWCP.
Title of Collection: Certification of
Funeral Expenses.
OMB Control Number: 1240–0040.
Affected Public: Private Sector—
businesses or other for-profits.
Total Estimated Number of
Respondents: 75.
Total Estimated Number of
Responses: 75.
Total Estimated Annual Time Burden:
19 hours.
Total Estimated Annual Other Costs
Burden: $39.
Dated: April 3, 2014.
Michel Smyth,
Departmental Clearance Officer.
[FR Doc. 2014–08050 Filed 4–9–14; 8:45 am]
BILLING CODE 4510–CF–P
DEPARTMENT OF LABOR
Employee Benefits Security
Administration
Exemptions From Certain Prohibited
Transaction Restrictions
Employee Benefits Security
Administration, Labor.
ACTION: Grant of Individual Exemptions.
AGENCY:
This document contains
exemptions issued by the Department of
Labor (the Department) from certain of
the prohibited transaction restrictions of
the Employee Retirement Income
Security Act of 1974 (ERISA or the Act)
and/or the Internal Revenue Code of
1986 (the Code). This notice includes
the following: 2014–01, Bank of
America Corporation, D–11729; 2014–
02, The ABB Inc. Cash Balance Pension
Plan (the Cash Balance Plan); the Cash
Balance Pension Plan for Certain
Represented Employees of ABB Inc. (the
Union Cash Balance Plan); the Pension
Plan for Employees of the Process
Analytics Division of ABB Inc.
Represented by the Laborer’s
International Union of North America
(AFL–CIO), Local No. 1304 (the Process
Analytics Plan); the Pension Plan of
SUMMARY:
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Fischer & Porter Company (the Fischer
& Porter Plan); and the ABB Inc.
Pension Plan (UE 625 & 626) (the UE
625 & 626 Plan) (each a Plan, and
collectively, the Plans), D–11742 thru
D–11746 respectively; and 2014–03,
Intel Corporation (Intel), L–11760.
A notice
was published in the Federal Register of
the pendency before the Department of
proposals to grant such exemptions.
Each notice set forth a summary of facts
and representations contained in the
application for exemption and referred
interested persons to the application for
a complete statement of the facts and
representations. The application has
been available for public inspection at
the Department in Washington, DC. The
notice also invited interested persons to
submit comments on the requested
exemption to the Department. In
addition the notice stated that any
interested person might submit a
written request that a public hearing be
held (where appropriate). The applicant
has represented that it has complied
with the requirements of the notification
to interested persons. No requests for a
hearing were received by the
Department. Public comments were
received by the Department as described
in the granted exemption.
The notice of proposed exemption
was issued and the exemption is being
granted solely by the Department
because, effective December 31, 1978,
section 102 of Reorganization Plan No.
4 of 1978, 5 U.S.C. App. 1 (1996),
transferred the authority of the Secretary
of the Treasury to issue exemptions of
the type proposed to the Secretary of
Labor.
SUPPLEMENTARY INFORMATION:
Statutory Findings
In accordance with section 408(a) of
the Act and/or section 4975(c)(2) of the
Code and the procedures set forth in 29
CFR Part 2570, Subpart B (76 FR 66637,
66644, October 27, 2011) 1 and based
upon the entire record, the Department
makes the following findings:
(a) The exemption is administratively
feasible;
(b) The exemption is in the interests
of the plan and its participants and
beneficiaries; and
(c) The exemption is protective of the
rights of the participants and
beneficiaries of the plan.
1 The Department has considered exemption
applications received prior to December 27, 2011
under the exemption procedures set forth in 29 CFR
Part 2570, Subpart B (55 FR 32836, 32847, August
10, 1990).
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Federal Register / Vol. 79, No. 69 / Thursday, April 10, 2014 / Notices
Bank of America Corporation
Located in Charlotte, NC
[Prohibited Transaction Exemption 2014–01;
Application No. D–11729]
Exemption
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Section I: Covered Transactions
The restrictions of ERISA sections
406(a)(1)(D) and 406(b) and the
sanctions resulting from the application
of Code section 4975 (including the loss
of exemption 2 by reason of Code
sections 4975(c)(1)(D), (E) and (F)) shall
not apply to the receipt of Relationship
Benefits by an individual for whose
benefit a Covered Plan is established or
maintained, or by his or her Family
Members, from BAC pursuant to an
arrangement in which the Account
Value of, or the Fees incurred for
services provided to, the Covered Plan
is taken into account for purposes of
determining eligibility to receive such
Relationship Benefits, provided that
each condition of Section II of this
exemption is satisfied.
Section II: Conditions
(a) The Covered Plan whose Account
Value, or whose Fees paid, are taken
into account for purposes of
determining eligibility to receive
Relationship Benefits under the
arrangement must be established and
maintained for the exclusive benefit of
the participant covered under the
Covered Plan, his or her spouse, or their
beneficiaries.
(b) The Relationship Benefits offered
under the arrangement must be of a type
that a Qualified Affiliate could offer
consistent with all applicable federal
and state banking laws and all
applicable federal and state laws
regulating Broker-Dealers.
(c) Where Account Values are taken
into account for purposes of
determining eligibility to receive
benefits under the arrangement, the
Account Values of Covered Plan
accounts shall be treated as favorably,
for purposes of satisfying such
eligibility requirements, as the Account
Values of other types of customer
accounts.
(d) Where levels of Fees incurred are
taken into account for purposes of
determining eligibility to receive
benefits under the arrangement, the
levels of Fees incurred by Covered Plan
accounts shall be treated as favorably,
2 Pursuant to Code section 408(e)(2)(A)(for an
individual retirement account or individual
retirement annuity); Code section 530(e) (for a
Coverdell education savings account); Code section
220(e)(2) (for an Archer medical savings account);
or Code section 223(e)(2) (for a health savings
account).
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for purposes of satisfying such
eligibility requirements, as the levels of
Fees incurred by other types of
customer accounts.
(e) The Relationship Benefits offered
under the arrangement must be
provided by a Qualified Affiliate in the
ordinary course of its business as a Bank
or Broker-Dealer to customers who
qualify for such benefits, but who do not
maintain Covered Plans with a
Qualified Affiliate.
(f) The combined total of fees for the
provision of services to a Covered Plan
is not in excess of reasonable
compensation within the meaning of
ERISA section 408(b)(2) and Code
section 4975(d)(2).
(g) The investment performance of the
investments made by the Covered Plan
is no less favorable than the investment
performance of identical investments
that could have been made at the same
time by a customer of BAC who is not
eligible for (or who does not receive)
Relationship Benefits.
(h) The Relationship Benefits offered
under the arrangement to the Covered
Plan customer must be the same as are
offered to non-Covered Plan customers
of Qualified Affiliates having the same
aggregate Account Value or the same
amount of Fees generated.
Section III: Definitions
The following definitions apply to
this exemption:
(a) The term ‘‘Account Value’’ means
investments in cash or securities held in
the account for which market quotations
are readily available. For purposes of
the exemption, the term ‘‘cash’’ includes
savings accounts that are insured by a
federal deposit insurance agency and
constitute deposits as that term is
defined in 29 CFR 2550.408b–4(c)(3).
The term ‘‘Account Value’’ does not
include investments that are offered by
BAC (or a Qualified Affiliate)
exclusively to Covered Plans.
(b) The term ‘‘affiliate’’ includes any
person directly or indirectly controlling,
controlled by, or under common control
with Bank of America Corporation.
(c) The term ‘‘Bank’’ means a bank
described in Code section 408(n).
(d) The term ‘‘BAC’’ means Bank of
America Corporation and any of its
affiliates.
(e) The term ‘‘Broker-Dealer’’ means a
broker-dealer registered under the
Securities Exchange Act of 1934, as
amended.
(f) The term ‘‘control’’ means the
power to exercise a controlling
influence over the management or
policies of a person other than an
individual.
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(g) The term ‘‘Covered Plan’’ means
an IRA or other savings account
described in section III(j) of this
exemption or a Keogh Plan described in
section III(k) of this exemption that is
established with BAC as trustee or
custodian.
(h) The term ‘‘Family Members’’
means beneficiaries of the individual for
whose benefit the Covered Plan is
established or maintained, who would
be members of the family as that term
is defined in Code section 4975(e)(6), or
a brother, a sister, or a spouse of a
brother or sister.
(i) The term ‘‘Fees’’ means
commissions and other fees received by
a Broker-Dealer from the Covered Plan
for the provision of services, including
but not limited to: Brokerage
commissions, investment management
fees, investment advisory fees, custodial
fees, and administrative fees.
(j) The term ‘‘IRA’’ means an
individual retirement account described
in Code section 408(a), an individual
retirement annuity described in Code
section 408(b), a Coverdell education
savings account described in Code
section 530, an Archer MSA described
in Code section 220(d), or a health
savings account described in Code
section 223(d). For purposes of this
exemption, the term ‘‘IRA’’ does not
include an employee benefit plan
covered by Title I of ERISA, except for
a Simplified Employee Pension (SEP)
described in Code section 408(k) and a
Simple Retirement Account described
in Code section 408(p) that provides
participants with the unrestricted
authority to transfer their balances to
IRAs or Simple Retirement Accounts
sponsored by different financial
institutions.
(k) The term ‘‘Keogh Plan’’ means a
pension, profit-sharing, or stock bonus
plan qualified under Code section
401(a) and exempt from taxation under
Code section 501(a) under which some
or all of the participants are employees
described in Code section 401(c). For
purposes of this exemption, the term
‘‘Keogh Plan’’ does not include an
employee benefit plan covered by Title
I of ERISA.
(l) The term ‘‘Qualified Affiliate’’
means any person directly or indirectly
controlling, controlled by, or under
common control with BAC that is a
Bank or Broker-Dealer.
(m) The term ‘‘Relationship Benefits’’
means reduced or no cost financial
products and services, including
premium rates of account or investment
interest, discounted rates of interest on
loans, reductions or waivers of
otherwise applicable fees and charges,
and/or differentiated servicing.
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Written Comments
The Department invited all interested
persons to submit written comments
and/or requests for a public hearing
with respect to the notice of proposed
exemption, published on November 6,
2013, at 78 FR 66769. All comments and
requests for hearing were due by
December 21, 2013. During the
comment period, the Department
received no comments and no requests
for a hearing from interested persons.
Accordingly, after giving full
consideration to the entire record, the
Department has decided to grant the
exemption. The complete application
file (Application No. D–11729),
including all supplemental submissions
received by the Department, is available
for public inspection in the Public
Disclosure Room of the Employee
Benefits Security Administration, Room
N–1513, U.S. Department of Labor, 200
Constitution Avenue NW., Washington,
DC 20210.
For a more complete statement of the
facts and representations supporting the
Department’s decision to grant this
exemption, refer to the notice of
proposed exemption published on
November 6, 2013, at 78 FR 66769.
FOR FURTHER INFORMATION CONTACT: Mr.
Erin S. Hesse of the Department,
telephone (202) 693–8546. (This is not
a toll-free number.)
The ABB Inc. Cash Balance Pension
Plan (the Cash Balance Plan); the Cash
Balance Pension Plan for Certain
Represented Employees of ABB Inc.
(the Union Cash Balance Plan); the
Pension Plan for Employees of the
Process Analytics Division of ABB Inc.
Represented by the Laborer’s
International Union of North America
(AFL–CIO), Local No. 1304 (the Process
Analytics Plan); the Pension Plan of
Fischer & Porter Company (the Fischer
& Porter Plan); and the ABB Inc.
Pension Plan (UE 625 & 626) (the UE
625 & 626 Plan) (each a Plan, and
collectively, the Plans)
Located in Cary, NC
[Prohibited Transaction Exemption 2014–02;
Application Nos. D–11742 thru D–11746
respectively]
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Exemption
The restrictions of sections
406(a)(1)(A) and 406(b)(1) and (b)(2) of
ERISA and the sanctions resulting from
the application of section 4975(c)(1)(A)
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and (E) of the Code,3 shall not apply, to
the in-kind contribution (the
Contribution) of certain U.S. Treasury
Bills (the Securities) to the Plans by
ABB Inc., a party in interest with
respect to the Plans, on September 14,
2012, provided that the following
conditions are satisfied:
(a) The fair market value of the
Securities was determined by ABB Inc.
based on the closing price of the
Securities on the date of Contribution
(the Contribution Date) as quoted by
Bloomberg L.P., an independent third
party in the business of providing
financial data;
(b) The Securities represented less
than 12% of the assets of any Plan;
(c) The terms of the Contribution were
no less favorable to the Plans than those
negotiated at arm’s length under similar
circumstances between unrelated
parties;
(d) The Plans paid no commissions,
costs or fees with respect to the
Contribution; and
(e) ABB Inc. reviewed the
methodology used to value the
Securities and ensured that the Plans
received the fair market value of the
Securities.
Effective Date: This exemption is
effective as of September 14, 2012.
Written Comments
The Department invited all interested
persons to submit written comments
and/or requests for a public hearing
with respect to the notice of proposed
exemption (the Notice) on or before
September 5, 2013. During the comment
period, the Department received two
written comments which generally
involved matters outside the scope of
the proposed exemption. The
Department also received one written
comment from ABB Inc. (the Applicant).
The Applicant’s comment and the
Department’s response thereto are
described below.4
Applicant’s Comment
The Applicant’s comment generally
provided clarifications and/or updates
of the names of certain corporate
entities of ABB Inc. and the Plans’
actuary, the number of employees of
3 For purposes of this exemption, references to
the provisions of Title I of ERISA, unless otherwise
specified, refer also to the corresponding provisions
of the Code.
4 Capitalized terms not defined herein have the
meanings ascribed to them in the facts and
representations of the proposed exemption.
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ABB Inc., and the numbers of
participants and beneficiaries of the
Plans. In this regard, Paragraph 1 of the
Facts and Representations section of the
Notice (the F&R) describes ABB Inc. as
the U.S. subsidiary of Asea Brown
Boveri Ltd., and further describes ABB
Inc. as employing approximately 20,000
employees in the U.S. The Applicant
clarifies that ABB Inc. is the indirect
U.S. subsidiary of ABB Ltd., and that
ABB Inc. employs approximately 8,000
individuals in the U.S. Paragraphs 2 and
7 of the F&R describe the risk
management team that advises the ABB
Inc. Pension Review Committee with
respect to the investment of the assets
in the ABB Inc. Master Trust as the
Pension and Risk Management
Committee. The Applicant clarifies that
this entity is called Pension and Thrift
Management. Section 2 of the F&R
describes the Plans’ actuary as Towers
Watson. The Applicant clarifies that the
actuary for each of the Plans is Towers
Watson Delaware Holdings, Inc. The
Department takes note of the
Applicant’s clarifications to Paragraphs
1, 2, and 7 of the F&R.
Paragraph 1 of the F&R provides the
participant counts for each of the Plans
as of June 26, 2012, as that was the most
recent audited information available at
the time of the proposed exemption.
The Applicant’s comment provides an
updated participant count for the Plans
as of December 31, 2012, as follows: The
Cash Balance Plan has 15,796
participants and beneficiaries; the
Union Cash Balance Plan has 701
participants and beneficiaries; the
Process Analytics Plan has 162
participants and beneficiaries; the
Fischer & Porter Plan has 1,380
participants and beneficiaries; and the
UE 625 & 626 Plan has 218 participants
and beneficiaries. The Department takes
note of the Applicant’s update to the
numbers of participants and
beneficiaries of the Plans in Paragraph
1 of the F&R.
The Applicant also provided a
correction to the table in Paragraph 9 of
the F&R that describes the increase in
the estimated AFTAP for each Plan that
occurred as a result of the Contribution.
In this regard, the Applicant states that
the table provided the correct AFTAP
amounts but attributed such amounts to
the incorrect Plans, and that the
following table correctly reflects the
AFTAP amounts for each Plan:
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Estimated
AFTAP without
discounted
securities
contribution
(percent)
Plan
Cash Balance Plan ..........................................................................................................
Union Cash Balance Plan ...............................................................................................
Process Analytics Plan ....................................................................................................
UE 625 & 626 Plan ..........................................................................................................
Fischer & Porter Plan ......................................................................................................
The Department notes the changes to
the table in Paragraph 9 of the F&R and
a conforming change to Paragraph 12 as
well.
Finally, the Applicant seeks to clarify
that Paragraph 10 of the Summary of
F&R, should read that the Contribution
may have violated sections 406(b)(1)
and (2) of the Act. The Department
acknowledges this clarification.
After giving full consideration to the
entire record, including the written
comment, the Department has decided
to grant the exemption, as described
above. The complete application file is
available for public inspection in the
Public Disclosure Room of the
Employee Benefits Security
Administration, Room N–1513, U.S.
Department of Labor, 200 Constitution
Avenue NW., Washington, DC 20210.
For a more complete statement of the
facts and representations supporting the
Department’s decision to grant this
exemption, refer to the proposed
exemption published in the Federal
Register on July 22, 2013, at 78 FR
43935.
Ms.
Jennifer Erin Brown of the Department
at (202) 693–8352. (This is not a toll-free
number.)
FOR FURTHER INFORMATION CONTACT:
Intel Corporation (Intel)
Located in Santa Clara, CA
[Prohibited Transaction Exemption 2014–03;
Exemption Application No. L–11760]
Exemption
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Section I. Transactions
The restrictions of sections
406(a)(1)(D) and 406(b) of the Act shall
not apply, effective January 1, 2013, to:
(a) The reinsurance of risks and the
receipt of premiums therefrom by
Technology Assurance Limited (TAL),
an affiliate of Intel, as the term
‘‘affiliate’’ is defined in Section III(a)
below, in connection with basic and
supplemental group term life insurance
sold by the Minnesota Life Insurance
Company (MN Life), or any successor
insurance company which is unrelated
to Intel (the Fronting Insurer), to the
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Intel Group Life Insurance Plan (the Life
Plan); and
(b) The reinsurance of risks and the
receipt of premiums therefrom by TAL,
in connection with basic and
supplemental accidental death and
dismemberment (AD&D) insurance sold
by the Fronting Insurer to the Intel
Group Accidental Death and
Dismemberment Plan (the AD&D Plan); 5
provided the conditions set forth in
Section II, below, are satisfied.
Section II. Conditions
(a) TAL—(1) Is a party in interest with respect
to the Plans by reason of a stock or
partnership affiliation with Intel that is
described in section 3(14)(E) or 3(14)(G)
of the Act;
(2) Is licensed to sell insurance or
conduct reinsurance operations in at
least one ‘‘State,’’ as defined in section
3(10) of the Act;
(3) Has obtained a Certificate of
Authority from the Hawaii Department
of Insurance, which has neither been
revoked nor suspended;
(4)(A) Has undergone an examination
by an independent certified public
accountant for its last completed taxable
year immediately prior to the taxable
year of the reinsurance transaction
covered by this exemption; or
(B) Has undergone a financial
examination by the HIDOI within five
(5) years prior to the end of the year
preceding the year in which such
reinsurance transaction has occurred;
and
(5) Is licensed to conduct reinsurance
transactions by Hawaii, whose law
requires that an actuarial review of
reserves be conducted annually by an
independent firm of actuaries and
reported to the appropriate regulatory
authority.
(b) The Plans pay no more than
adequate consideration for the
insurance contracts.
(c) No commissions are paid by the
Plans with respect to the direct sale of
such contracts or the reinsurance
thereof.
5 The AD&D Plan and the Life Plan are together
referred to herein as the ‘‘Plans.’’
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AFTAP with
discounted
securities
contribution
110.44
112.35
111.74
109.09
112.78
112.29
113.72
120.39
121.70
114.16
Increase in
AFTAP due to
securities
contribution
(percent)
1.85
1.37
8.65
12.61
1.38
(d) In the initial year of every
reinsurance contract involving TAL and
a Fronting Insurer, there is an
immediate and objectively determined
benefit to participants and beneficiaries
of the Plans in the form of increased
benefits, and such benefits continue in
all subsequent years of each such
contract of reinsurance and in every
renewal of each such contract, and will
at least approximate the increase in
benefits that will be effective as of
January 1, 2013, as described in the
Notice of Proposed Exemption (the
Notice).
(e) In the initial year and in
subsequent years of coverage provided
by a Fronting Insurer, the formula used
by the Fronting Insurer to calculate
premiums will be similar to formulae
used by other insurers providing
comparable coverage under similar
programs. Furthermore, the premium
charge calculated in accordance with
the formula will be reasonable and will
be comparable to the premium charged
by the Fronting Insurer and its
competitors with the same or a better
rating providing the same coverage
under comparable programs.
(f) The Fronting Insurer has a
financial strength rating of ‘‘A’’ or better
from A. M. Best Company. The
reinsurance arrangement between the
Fronting Insurer and TAL will be
indemnity insurance only, (i.e., the
Fronting Insurer will not be relieved of
liability to the Plans should TAL be
unable or unwilling to cover any
liability arising from the reinsurance
arrangement).
(g) The Plans retain an independent,
qualified fiduciary (the I/F) or successor
to such fiduciary, as defined in Section
III(c), below, to analyze the transactions
and to render an opinion that the
requirements of Section II(a) through (f)
and (h) of this exemption have been
satisfied.
(h) Participants and beneficiaries in
the Plans will receive in subsequent
years of every contract of reinsurance
involving TAL and the Fronting Insurer
no less than the immediate and
objectively determined increased
benefits such participants and
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beneficiaries received in the initial year
of each such contract involving TAL
and the Fronting Insurer.
(i) The I/F will: Monitor the
transactions described herein on behalf
of the Plans on a continuing basis to
ensure such transactions remain in the
interest of the Plans; take all appropriate
actions to safeguard the interests of the
Plans; and enforce compliance with all
conditions and obligations imposed on
any party dealing with the Plans.
(j) In connection with the provision to
participants in the Plans of the
insurance coverage provided by the
Fronting Insurer which is reinsured by
TAL, the I/F will review all contracts
(and any renewal of such contracts) of
the reinsurance of risks and the receipt
of premiums therefrom by TAL and
must determine that the requirements of
this exemption, and the terms of the
increased benefits continue to be
satisfied.
Section III. Definitions
(a) The term ‘‘affiliate’’ of a person
includes any person directly or
indirectly, through one or more
intermediaries, controlling, controlled
by, or under common control with the
person;
(b) The term ‘‘control’’ means the
power to exercise a controlling
influence over the management or
policies of a person other than an
individual.
(c) The term ‘‘I/F’’ describes a person,
or a successor to such person, who is
not Intel or TAL or an affiliate of either
entity; and:
(1) Does not have an ownership
interest in Intel, in TAL, or in an
affiliate of either;
(2) Is not a fiduciary with respect to
the Plans prior to its appointment to
serve as the I/F;
(3) Has acknowledged in writing
acceptance of fiduciary responsibility
and has agreed not to participate in any
decision with respect to any transaction
in which it has an interest that might
affect its best judgment as a fiduciary;
and
(4) Has appropriate training,
experience, and facilities to act on
behalf of the Plans regarding the subject
transactions in accordance with the
fiduciary duties and responsibilities
prescribed by the Act.
For purposes of this definition of an
‘‘I/F,’’ no organization or individual
may serve as an I/F for any fiscal year
if the gross income received by such
organization or individual (or
partnership or corporation of which
such individual is an officer, director, or
10 percent or more partner or
shareholder) for that fiscal year exceeds
VerDate Mar<15>2010
18:14 Apr 09, 2014
Jkt 232001
two percent (2%) of that organization’s
or individual’s annual gross income
from all sources for the prior fiscal year
from Intel or from TAL, or from an
affiliate of either (including amounts
received for services as I/F under any
prohibited transaction exemption
granted by the Department).
In addition, no organization or
individual who is an I/F, and no
partnership or corporation of which
such organization or individual is an
officer, director, or 10 percent (10%) or
more partner or shareholder, may
acquire any property from, sell any
property to, or borrow any funds from
Intel or from TAL, or from any affiliate
of either during the period that such
organization or individual serves as an
I/F, and continuing for a period of six
(6) months after such organization or
individual ceases to be the I/F, or
negotiates any such transaction during
the period that such organization or
individual serves as the I/F.
In the event a successor I/F is
appointed to represent the interests of
the Plans with respect to the subject
transactions, there may be no lapse in
time between the resignation or
termination of the former I/F and the
appointment of the successor I/F.
Effective Date: This exemption is
effective as of January 1, 2013.
Written Comments
In the Notice, the Department invited
all interested persons to submit written
comments and requests for a hearing
within 50 days of the date of the
publication on November 6, 2013, of the
Notice in the Federal Register. The
Notice stated that all comments and
requests for a hearing were due by
December 26, 2013. In an email dated
December 4, 2013, Intel’s representative
confirmed that the required notification
was sent to all interested persons via
email and/or first class mail no later
than November 15, 2013.
During the comment period, the
Department received no requests for a
hearing. In addition, the Department did
not receive any written comments.
After full consideration and review of
the entire record, the Department has
decided to grant the exemption. The
complete application file (L–11760) is
available for public inspection in the
Public Disclosure Room of the
Employee Benefits Security
Administration, Room N–1513, U.S.
Department of Labor, 200 Constitution
Avenue NW., Washington, DC 20210.
FOR FURTHER INFORMATION CONTACT:
Blessed Chuksorji-Keefe of the
Department, telephone (202) 693–8567.
(This is not a toll-free number.)
PO 00000
Frm 00064
Fmt 4703
Sfmt 4703
General Information
The attention of interested persons is
directed to the following:
(1) The fact that a transaction is the
subject of an exemption under section
408(a) of the Act and/or section
4975(c)(2) of the Code does not relieve
a fiduciary or other party in interest or
disqualified person from certain other
provisions to which the exemption does
not apply and the general fiduciary
responsibility provisions of section 404
of the Act, which among other things
require a fiduciary to discharge his
duties respecting the plan solely in the
interest of the participants and
beneficiaries of the plan and in a
prudent fashion in accordance with
section 404(a)(1)(B) of the Act; nor does
it affect the requirement of section
401(a) of the Code that the plan must
operate for the exclusive benefit of the
employees of the employer maintaining
the plan and their beneficiaries;
(2) These exemptions are
supplemental to and not in derogation
of, any other provisions of the Act and/
or the Code, including statutory or
administrative exemptions and
transactional rules. Furthermore, the
fact that a transaction is subject to an
administrative or statutory exemption is
not dispositive of whether the
transaction is in fact a prohibited
transaction; and
(3) The availability of an exemption is
subject to the express condition that the
material facts and representations
contained in the application accurately
describes all material terms of the
transaction which is the subject of the
exemption.
Signed at Washington, DC, this 27th day of
March, 2014.
Lyssa E. Hall,
Acting Director of Exemption Determinations,
Employee Benefits Security Administration,
U.S. Department of Labor.
[FR Doc. 2014–07984 Filed 4–9–14; 8:45 am]
BILLING CODE 4510–29–P
DEPARTMENT OF LABOR
Employment and Training
Administration
Notice of Availability of Funds and
Solicitation for Grant Applications for
Women in Apprenticeship and
Nontraditional Occupations Technical
Assistance Grants
Employment and Training
Administration, Labor.
ACTION: Notice of Solicitation for Grant
Applications (SGA).
AGENCY:
E:\FR\FM\10APN1.SGM
10APN1
]]>Agencies
[Federal Register Volume 79, Number 69 (Thursday, April 10, 2014)]
[Notices]
[Pages 19924-19928]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-07984]
-----------------------------------------------------------------------
DEPARTMENT OF LABOR
Employee Benefits Security Administration
Exemptions From Certain Prohibited Transaction Restrictions
AGENCY: Employee Benefits Security Administration, Labor.
ACTION: Grant of Individual Exemptions.
-----------------------------------------------------------------------
SUMMARY: This document contains exemptions issued by the Department of
Labor (the Department) from certain of the prohibited transaction
restrictions of the Employee Retirement Income Security Act of 1974
(ERISA or the Act) and/or the Internal Revenue Code of 1986 (the Code).
This notice includes the following: 2014-01, Bank of America
Corporation, D-11729; 2014-02, The ABB Inc. Cash Balance Pension Plan
(the Cash Balance Plan); the Cash Balance Pension Plan for Certain
Represented Employees of ABB Inc. (the Union Cash Balance Plan); the
Pension Plan for Employees of the Process Analytics Division of ABB
Inc. Represented by the Laborer's International Union of North America
(AFL-CIO), Local No. 1304 (the Process Analytics Plan); the Pension
Plan of Fischer & Porter Company (the Fischer & Porter Plan); and the
ABB Inc. Pension Plan (UE 625 & 626) (the UE 625 & 626 Plan) (each a
Plan, and collectively, the Plans), D-11742 thru D-11746 respectively;
and 2014-03, Intel Corporation (Intel), L-11760.
SUPPLEMENTARY INFORMATION: A notice was published in the Federal
Register of the pendency before the Department of proposals to grant
such exemptions. Each notice set forth a summary of facts and
representations contained in the application for exemption and referred
interested persons to the application for a complete statement of the
facts and representations. The application has been available for
public inspection at the Department in Washington, DC. The notice also
invited interested persons to submit comments on the requested
exemption to the Department. In addition the notice stated that any
interested person might submit a written request that a public hearing
be held (where appropriate). The applicant has represented that it has
complied with the requirements of the notification to interested
persons. No requests for a hearing were received by the Department.
Public comments were received by the Department as described in the
granted exemption.
The notice of proposed exemption was issued and the exemption is
being granted solely by the Department because, effective December 31,
1978, section 102 of Reorganization Plan No. 4 of 1978, 5 U.S.C. App. 1
(1996), transferred the authority of the Secretary of the Treasury to
issue exemptions of the type proposed to the Secretary of Labor.
Statutory Findings
In accordance with section 408(a) of the Act and/or section
4975(c)(2) of the Code and the procedures set forth in 29 CFR Part
2570, Subpart B (76 FR 66637, 66644, October 27, 2011) \1\ and based
upon the entire record, the Department makes the following findings:
---------------------------------------------------------------------------
\1\ The Department has considered exemption applications
received prior to December 27, 2011 under the exemption procedures
set forth in 29 CFR Part 2570, Subpart B (55 FR 32836, 32847, August
10, 1990).
---------------------------------------------------------------------------
(a) The exemption is administratively feasible;
(b) The exemption is in the interests of the plan and its
participants and beneficiaries; and
(c) The exemption is protective of the rights of the participants
and beneficiaries of the plan.
[[Page 19925]]
Bank of America Corporation
Located in Charlotte, NC
[Prohibited Transaction Exemption 2014-01; Application No. D-11729]
Exemption
Section I: Covered Transactions
The restrictions of ERISA sections 406(a)(1)(D) and 406(b) and the
sanctions resulting from the application of Code section 4975
(including the loss of exemption \2\ by reason of Code sections
4975(c)(1)(D), (E) and (F)) shall not apply to the receipt of
Relationship Benefits by an individual for whose benefit a Covered Plan
is established or maintained, or by his or her Family Members, from BAC
pursuant to an arrangement in which the Account Value of, or the Fees
incurred for services provided to, the Covered Plan is taken into
account for purposes of determining eligibility to receive such
Relationship Benefits, provided that each condition of Section II of
this exemption is satisfied.
---------------------------------------------------------------------------
\2\ Pursuant to Code section 408(e)(2)(A)(for an individual
retirement account or individual retirement annuity); Code section
530(e) (for a Coverdell education savings account); Code section
220(e)(2) (for an Archer medical savings account); or Code section
223(e)(2) (for a health savings account).
---------------------------------------------------------------------------
Section II: Conditions
(a) The Covered Plan whose Account Value, or whose Fees paid, are
taken into account for purposes of determining eligibility to receive
Relationship Benefits under the arrangement must be established and
maintained for the exclusive benefit of the participant covered under
the Covered Plan, his or her spouse, or their beneficiaries.
(b) The Relationship Benefits offered under the arrangement must be
of a type that a Qualified Affiliate could offer consistent with all
applicable federal and state banking laws and all applicable federal
and state laws regulating Broker-Dealers.
(c) Where Account Values are taken into account for purposes of
determining eligibility to receive benefits under the arrangement, the
Account Values of Covered Plan accounts shall be treated as favorably,
for purposes of satisfying such eligibility requirements, as the
Account Values of other types of customer accounts.
(d) Where levels of Fees incurred are taken into account for
purposes of determining eligibility to receive benefits under the
arrangement, the levels of Fees incurred by Covered Plan accounts shall
be treated as favorably, for purposes of satisfying such eligibility
requirements, as the levels of Fees incurred by other types of customer
accounts.
(e) The Relationship Benefits offered under the arrangement must be
provided by a Qualified Affiliate in the ordinary course of its
business as a Bank or Broker-Dealer to customers who qualify for such
benefits, but who do not maintain Covered Plans with a Qualified
Affiliate.
(f) The combined total of fees for the provision of services to a
Covered Plan is not in excess of reasonable compensation within the
meaning of ERISA section 408(b)(2) and Code section 4975(d)(2).
(g) The investment performance of the investments made by the
Covered Plan is no less favorable than the investment performance of
identical investments that could have been made at the same time by a
customer of BAC who is not eligible for (or who does not receive)
Relationship Benefits.
(h) The Relationship Benefits offered under the arrangement to the
Covered Plan customer must be the same as are offered to non-Covered
Plan customers of Qualified Affiliates having the same aggregate
Account Value or the same amount of Fees generated.
Section III: Definitions
The following definitions apply to this exemption:
(a) The term ``Account Value'' means investments in cash or
securities held in the account for which market quotations are readily
available. For purposes of the exemption, the term ``cash'' includes
savings accounts that are insured by a federal deposit insurance agency
and constitute deposits as that term is defined in 29 CFR 2550.408b-
4(c)(3). The term ``Account Value'' does not include investments that
are offered by BAC (or a Qualified Affiliate) exclusively to Covered
Plans.
(b) The term ``affiliate'' includes any person directly or
indirectly controlling, controlled by, or under common control with
Bank of America Corporation.
(c) The term ``Bank'' means a bank described in Code section
408(n).
(d) The term ``BAC'' means Bank of America Corporation and any of
its affiliates.
(e) The term ``Broker-Dealer'' means a broker-dealer registered
under the Securities Exchange Act of 1934, as amended.
(f) The term ``control'' means the power to exercise a controlling
influence over the management or policies of a person other than an
individual.
(g) The term ``Covered Plan'' means an IRA or other savings account
described in section III(j) of this exemption or a Keogh Plan described
in section III(k) of this exemption that is established with BAC as
trustee or custodian.
(h) The term ``Family Members'' means beneficiaries of the
individual for whose benefit the Covered Plan is established or
maintained, who would be members of the family as that term is defined
in Code section 4975(e)(6), or a brother, a sister, or a spouse of a
brother or sister.
(i) The term ``Fees'' means commissions and other fees received by
a Broker-Dealer from the Covered Plan for the provision of services,
including but not limited to: Brokerage commissions, investment
management fees, investment advisory fees, custodial fees, and
administrative fees.
(j) The term ``IRA'' means an individual retirement account
described in Code section 408(a), an individual retirement annuity
described in Code section 408(b), a Coverdell education savings account
described in Code section 530, an Archer MSA described in Code section
220(d), or a health savings account described in Code section 223(d).
For purposes of this exemption, the term ``IRA'' does not include an
employee benefit plan covered by Title I of ERISA, except for a
Simplified Employee Pension (SEP) described in Code section 408(k) and
a Simple Retirement Account described in Code section 408(p) that
provides participants with the unrestricted authority to transfer their
balances to IRAs or Simple Retirement Accounts sponsored by different
financial institutions.
(k) The term ``Keogh Plan'' means a pension, profit-sharing, or
stock bonus plan qualified under Code section 401(a) and exempt from
taxation under Code section 501(a) under which some or all of the
participants are employees described in Code section 401(c). For
purposes of this exemption, the term ``Keogh Plan'' does not include an
employee benefit plan covered by Title I of ERISA.
(l) The term ``Qualified Affiliate'' means any person directly or
indirectly controlling, controlled by, or under common control with BAC
that is a Bank or Broker-Dealer.
(m) The term ``Relationship Benefits'' means reduced or no cost
financial products and services, including premium rates of account or
investment interest, discounted rates of interest on loans, reductions
or waivers of otherwise applicable fees and charges, and/or
differentiated servicing.
[[Page 19926]]
Written Comments
The Department invited all interested persons to submit written
comments and/or requests for a public hearing with respect to the
notice of proposed exemption, published on November 6, 2013, at 78 FR
66769. All comments and requests for hearing were due by December 21,
2013. During the comment period, the Department received no comments
and no requests for a hearing from interested persons. Accordingly,
after giving full consideration to the entire record, the Department
has decided to grant the exemption. The complete application file
(Application No. D-11729), including all supplemental submissions
received by the Department, is available for public inspection in the
Public Disclosure Room of the Employee Benefits Security
Administration, Room N-1513, U.S. Department of Labor, 200 Constitution
Avenue NW., Washington, DC 20210.
For a more complete statement of the facts and representations
supporting the Department's decision to grant this exemption, refer to
the notice of proposed exemption published on November 6, 2013, at 78
FR 66769.
FOR FURTHER INFORMATION CONTACT: Mr. Erin S. Hesse of the Department,
telephone (202) 693-8546. (This is not a toll-free number.)
The ABB Inc. Cash Balance Pension Plan (the Cash Balance Plan); the
Cash Balance Pension Plan for Certain Represented Employees of ABB Inc.
(the Union Cash Balance Plan); the Pension Plan for Employees of the
Process Analytics Division of ABB Inc. Represented by the Laborer's
International Union of North America (AFL-CIO), Local No. 1304 (the
Process Analytics Plan); the Pension Plan of Fischer & Porter Company
(the Fischer & Porter Plan); and the ABB Inc. Pension Plan (UE 625 &
626) (the UE 625 & 626 Plan) (each a Plan, and collectively, the Plans)
Located in Cary, NC
[Prohibited Transaction Exemption 2014-02; Application Nos. D-11742
thru D-11746 respectively]
Exemption
The restrictions of sections 406(a)(1)(A) and 406(b)(1) and (b)(2)
of ERISA and the sanctions resulting from the application of section
4975(c)(1)(A) and (E) of the Code,\3\ shall not apply, to the in-kind
contribution (the Contribution) of certain U.S. Treasury Bills (the
Securities) to the Plans by ABB Inc., a party in interest with respect
to the Plans, on September 14, 2012, provided that the following
conditions are satisfied:
---------------------------------------------------------------------------
\3\ For purposes of this exemption, references to the provisions
of Title I of ERISA, unless otherwise specified, refer also to the
corresponding provisions of the Code.
---------------------------------------------------------------------------
(a) The fair market value of the Securities was determined by ABB
Inc. based on the closing price of the Securities on the date of
Contribution (the Contribution Date) as quoted by Bloomberg L.P., an
independent third party in the business of providing financial data;
(b) The Securities represented less than 12% of the assets of any
Plan;
(c) The terms of the Contribution were no less favorable to the
Plans than those negotiated at arm's length under similar circumstances
between unrelated parties;
(d) The Plans paid no commissions, costs or fees with respect to
the Contribution; and
(e) ABB Inc. reviewed the methodology used to value the Securities
and ensured that the Plans received the fair market value of the
Securities.
Effective Date: This exemption is effective as of September 14,
2012.
Written Comments
The Department invited all interested persons to submit written
comments and/or requests for a public hearing with respect to the
notice of proposed exemption (the Notice) on or before September 5,
2013. During the comment period, the Department received two written
comments which generally involved matters outside the scope of the
proposed exemption. The Department also received one written comment
from ABB Inc. (the Applicant). The Applicant's comment and the
Department's response thereto are described below.\4\
---------------------------------------------------------------------------
\4\ Capitalized terms not defined herein have the meanings
ascribed to them in the facts and representations of the proposed
exemption.
---------------------------------------------------------------------------
Applicant's Comment
The Applicant's comment generally provided clarifications and/or
updates of the names of certain corporate entities of ABB Inc. and the
Plans' actuary, the number of employees of ABB Inc., and the numbers of
participants and beneficiaries of the Plans. In this regard, Paragraph
1 of the Facts and Representations section of the Notice (the F&R)
describes ABB Inc. as the U.S. subsidiary of Asea Brown Boveri Ltd.,
and further describes ABB Inc. as employing approximately 20,000
employees in the U.S. The Applicant clarifies that ABB Inc. is the
indirect U.S. subsidiary of ABB Ltd., and that ABB Inc. employs
approximately 8,000 individuals in the U.S. Paragraphs 2 and 7 of the
F&R describe the risk management team that advises the ABB Inc. Pension
Review Committee with respect to the investment of the assets in the
ABB Inc. Master Trust as the Pension and Risk Management Committee. The
Applicant clarifies that this entity is called Pension and Thrift
Management. Section 2 of the F&R describes the Plans' actuary as Towers
Watson. The Applicant clarifies that the actuary for each of the Plans
is Towers Watson Delaware Holdings, Inc. The Department takes note of
the Applicant's clarifications to Paragraphs 1, 2, and 7 of the F&R.
Paragraph 1 of the F&R provides the participant counts for each of
the Plans as of June 26, 2012, as that was the most recent audited
information available at the time of the proposed exemption. The
Applicant's comment provides an updated participant count for the Plans
as of December 31, 2012, as follows: The Cash Balance Plan has 15,796
participants and beneficiaries; the Union Cash Balance Plan has 701
participants and beneficiaries; the Process Analytics Plan has 162
participants and beneficiaries; the Fischer & Porter Plan has 1,380
participants and beneficiaries; and the UE 625 & 626 Plan has 218
participants and beneficiaries. The Department takes note of the
Applicant's update to the numbers of participants and beneficiaries of
the Plans in Paragraph 1 of the F&R.
The Applicant also provided a correction to the table in Paragraph
9 of the F&R that describes the increase in the estimated AFTAP for
each Plan that occurred as a result of the Contribution. In this
regard, the Applicant states that the table provided the correct AFTAP
amounts but attributed such amounts to the incorrect Plans, and that
the following table correctly reflects the AFTAP amounts for each Plan:
[[Page 19927]]
----------------------------------------------------------------------------------------------------------------
Estimated AFTAP
without AFTAP with Increase in
discounted discounted AFTAP due to
Plan securities securities securities
contribution contribution contribution
(percent) (percent)
----------------------------------------------------------------------------------------------------------------
Cash Balance Plan......................................... 110.44 112.29 1.85
Union Cash Balance Plan................................... 112.35 113.72 1.37
Process Analytics Plan.................................... 111.74 120.39 8.65
UE 625 & 626 Plan......................................... 109.09 121.70 12.61
Fischer & Porter Plan..................................... 112.78 114.16 1.38
----------------------------------------------------------------------------------------------------------------
The Department notes the changes to the table in Paragraph 9 of the F&R
and a conforming change to Paragraph 12 as well.
Finally, the Applicant seeks to clarify that Paragraph 10 of the
Summary of F&R, should read that the Contribution may have violated
sections 406(b)(1) and (2) of the Act. The Department acknowledges this
clarification.
After giving full consideration to the entire record, including the
written comment, the Department has decided to grant the exemption, as
described above. The complete application file is available for public
inspection in the Public Disclosure Room of the Employee Benefits
Security Administration, Room N-1513, U.S. Department of Labor, 200
Constitution Avenue NW., Washington, DC 20210.
For a more complete statement of the facts and representations
supporting the Department's decision to grant this exemption, refer to
the proposed exemption published in the Federal Register on July 22,
2013, at 78 FR 43935.
FOR FURTHER INFORMATION CONTACT: Ms. Jennifer Erin Brown of the
Department at (202) 693-8352. (This is not a toll-free number.)
Intel Corporation (Intel)
Located in Santa Clara, CA
[Prohibited Transaction Exemption 2014-03; Exemption Application No. L-
11760]
Exemption
Section I. Transactions
The restrictions of sections 406(a)(1)(D) and 406(b) of the Act
shall not apply, effective January 1, 2013, to:
(a) The reinsurance of risks and the receipt of premiums therefrom
by Technology Assurance Limited (TAL), an affiliate of Intel, as the
term ``affiliate'' is defined in Section III(a) below, in connection
with basic and supplemental group term life insurance sold by the
Minnesota Life Insurance Company (MN Life), or any successor insurance
company which is unrelated to Intel (the Fronting Insurer), to the
Intel Group Life Insurance Plan (the Life Plan); and
(b) The reinsurance of risks and the receipt of premiums therefrom
by TAL, in connection with basic and supplemental accidental death and
dismemberment (AD&D) insurance sold by the Fronting Insurer to the
Intel Group Accidental Death and Dismemberment Plan (the AD&D Plan);
\5\ provided the conditions set forth in Section II, below, are
satisfied.
---------------------------------------------------------------------------
\5\ The AD&D Plan and the Life Plan are together referred to
herein as the ``Plans.''
---------------------------------------------------------------------------
Section II. Conditions
(a) TAL---
(1) Is a party in interest with respect to the Plans by reason of a
stock or partnership affiliation with Intel that is described in
section 3(14)(E) or 3(14)(G) of the Act;
(2) Is licensed to sell insurance or conduct reinsurance operations
in at least one ``State,'' as defined in section 3(10) of the Act;
(3) Has obtained a Certificate of Authority from the Hawaii
Department of Insurance, which has neither been revoked nor suspended;
(4)(A) Has undergone an examination by an independent certified
public accountant for its last completed taxable year immediately prior
to the taxable year of the reinsurance transaction covered by this
exemption; or
(B) Has undergone a financial examination by the HIDOI within five
(5) years prior to the end of the year preceding the year in which such
reinsurance transaction has occurred; and
(5) Is licensed to conduct reinsurance transactions by Hawaii,
whose law requires that an actuarial review of reserves be conducted
annually by an independent firm of actuaries and reported to the
appropriate regulatory authority.
(b) The Plans pay no more than adequate consideration for the
insurance contracts.
(c) No commissions are paid by the Plans with respect to the direct
sale of such contracts or the reinsurance thereof.
(d) In the initial year of every reinsurance contract involving TAL
and a Fronting Insurer, there is an immediate and objectively
determined benefit to participants and beneficiaries of the Plans in
the form of increased benefits, and such benefits continue in all
subsequent years of each such contract of reinsurance and in every
renewal of each such contract, and will at least approximate the
increase in benefits that will be effective as of January 1, 2013, as
described in the Notice of Proposed Exemption (the Notice).
(e) In the initial year and in subsequent years of coverage
provided by a Fronting Insurer, the formula used by the Fronting
Insurer to calculate premiums will be similar to formulae used by other
insurers providing comparable coverage under similar programs.
Furthermore, the premium charge calculated in accordance with the
formula will be reasonable and will be comparable to the premium
charged by the Fronting Insurer and its competitors with the same or a
better rating providing the same coverage under comparable programs.
(f) The Fronting Insurer has a financial strength rating of ``A''
or better from A. M. Best Company. The reinsurance arrangement between
the Fronting Insurer and TAL will be indemnity insurance only, (i.e.,
the Fronting Insurer will not be relieved of liability to the Plans
should TAL be unable or unwilling to cover any liability arising from
the reinsurance arrangement).
(g) The Plans retain an independent, qualified fiduciary (the I/F)
or successor to such fiduciary, as defined in Section III(c), below, to
analyze the transactions and to render an opinion that the requirements
of Section II(a) through (f) and (h) of this exemption have been
satisfied.
(h) Participants and beneficiaries in the Plans will receive in
subsequent years of every contract of reinsurance involving TAL and the
Fronting Insurer no less than the immediate and objectively determined
increased benefits such participants and
[[Page 19928]]
beneficiaries received in the initial year of each such contract
involving TAL and the Fronting Insurer.
(i) The I/F will: Monitor the transactions described herein on
behalf of the Plans on a continuing basis to ensure such transactions
remain in the interest of the Plans; take all appropriate actions to
safeguard the interests of the Plans; and enforce compliance with all
conditions and obligations imposed on any party dealing with the Plans.
(j) In connection with the provision to participants in the Plans
of the insurance coverage provided by the Fronting Insurer which is
reinsured by TAL, the I/F will review all contracts (and any renewal of
such contracts) of the reinsurance of risks and the receipt of premiums
therefrom by TAL and must determine that the requirements of this
exemption, and the terms of the increased benefits continue to be
satisfied.
Section III. Definitions
(a) The term ``affiliate'' of a person includes any person directly
or indirectly, through one or more intermediaries, controlling,
controlled by, or under common control with the person;
(b) The term ``control'' means the power to exercise a controlling
influence over the management or policies of a person other than an
individual.
(c) The term ``I/F'' describes a person, or a successor to such
person, who is not Intel or TAL or an affiliate of either entity; and:
(1) Does not have an ownership interest in Intel, in TAL, or in an
affiliate of either;
(2) Is not a fiduciary with respect to the Plans prior to its
appointment to serve as the I/F;
(3) Has acknowledged in writing acceptance of fiduciary
responsibility and has agreed not to participate in any decision with
respect to any transaction in which it has an interest that might
affect its best judgment as a fiduciary; and
(4) Has appropriate training, experience, and facilities to act on
behalf of the Plans regarding the subject transactions in accordance
with the fiduciary duties and responsibilities prescribed by the Act.
For purposes of this definition of an ``I/F,'' no organization or
individual may serve as an I/F for any fiscal year if the gross income
received by such organization or individual (or partnership or
corporation of which such individual is an officer, director, or 10
percent or more partner or shareholder) for that fiscal year exceeds
two percent (2%) of that organization's or individual's annual gross
income from all sources for the prior fiscal year from Intel or from
TAL, or from an affiliate of either (including amounts received for
services as I/F under any prohibited transaction exemption granted by
the Department).
In addition, no organization or individual who is an I/F, and no
partnership or corporation of which such organization or individual is
an officer, director, or 10 percent (10%) or more partner or
shareholder, may acquire any property from, sell any property to, or
borrow any funds from Intel or from TAL, or from any affiliate of
either during the period that such organization or individual serves as
an I/F, and continuing for a period of six (6) months after such
organization or individual ceases to be the I/F, or negotiates any such
transaction during the period that such organization or individual
serves as the I/F.
In the event a successor I/F is appointed to represent the
interests of the Plans with respect to the subject transactions, there
may be no lapse in time between the resignation or termination of the
former I/F and the appointment of the successor I/F.
Effective Date: This exemption is effective as of January 1, 2013.
Written Comments
In the Notice, the Department invited all interested persons to
submit written comments and requests for a hearing within 50 days of
the date of the publication on November 6, 2013, of the Notice in the
Federal Register. The Notice stated that all comments and requests for
a hearing were due by December 26, 2013. In an email dated December 4,
2013, Intel's representative confirmed that the required notification
was sent to all interested persons via email and/or first class mail no
later than November 15, 2013.
During the comment period, the Department received no requests for
a hearing. In addition, the Department did not receive any written
comments.
After full consideration and review of the entire record, the
Department has decided to grant the exemption. The complete application
file (L-11760) is available for public inspection in the Public
Disclosure Room of the Employee Benefits Security Administration, Room
N-1513, U.S. Department of Labor, 200 Constitution Avenue NW.,
Washington, DC 20210.
FOR FURTHER INFORMATION CONTACT: Blessed Chuksorji-Keefe of the
Department, telephone (202) 693-8567. (This is not a toll-free number.)
General Information
The attention of interested persons is directed to the following:
(1) The fact that a transaction is the subject of an exemption
under section 408(a) of the Act and/or section 4975(c)(2) of the Code
does not relieve a fiduciary or other party in interest or disqualified
person from certain other provisions to which the exemption does not
apply and the general fiduciary responsibility provisions of section
404 of the Act, which among other things require a fiduciary to
discharge his duties respecting the plan solely in the interest of the
participants and beneficiaries of the plan and in a prudent fashion in
accordance with section 404(a)(1)(B) of the Act; nor does it affect the
requirement of section 401(a) of the Code that the plan must operate
for the exclusive benefit of the employees of the employer maintaining
the plan and their beneficiaries;
(2) These exemptions are supplemental to and not in derogation of,
any other provisions of the Act and/or the Code, including statutory or
administrative exemptions and transactional rules. Furthermore, the
fact that a transaction is subject to an administrative or statutory
exemption is not dispositive of whether the transaction is in fact a
prohibited transaction; and
(3) The availability of an exemption is subject to the express
condition that the material facts and representations contained in the
application accurately describes all material terms of the transaction
which is the subject of the exemption.
Signed at Washington, DC, this 27th day of March, 2014.
Lyssa E. Hall,
Acting Director of Exemption Determinations, Employee Benefits Security
Administration, U.S. Department of Labor.
[FR Doc. 2014-07984 Filed 4-9-14; 8:45 am]
BILLING CODE 4510-29-P
