Registration Requirements for Pooled Plan Providers, 54288-54311 [2020-18504]

Agencies

• Employee Benefits Security Administration
• DEPARTMENT OF LABOR

[Federal Register Volume 85, Number 170 (Tuesday, September 1, 2020)]
[Proposed Rules]
[Pages 54288-54311]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-18504]


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DEPARTMENT OF LABOR

Employee Benefits Security Administration

29 CFR Parts 2510

RIN 1210-AB94


Registration Requirements for Pooled Plan Providers

AGENCY: Employee Benefits Security Administration, Labor.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would establish the requirements for 
registering with the Department of Labor as a ``pooled plan provider'' 
for ``pooled employer plans'' under sections 3(43) and 3(44) of the 
Employee Retirement Income Security Act of 1974, as amended (ERISA). 
The Setting Every Community Up for Retirement Enhancement Act of 2019 
(SECURE Act) provides that newly permitted ``pooled plan providers'' 
can begin offering ``pooled employer plans'' on January 1, 2021, but 
requires such persons to register with the Secretary of Labor before 
beginning operations. The proposed rule would also establish a new 
form--EBSA Form PR (Pooled Plan Provider Registration)--as the required 
filing format for pooled plan provider registrations. Filing the 
proposed Form

[[Page 54289]]

PR with the Department of Labor would also satisfy the SECURE Act 
requirement to register with the Treasury Department. The proposed rule 
would affect persons wishing to serve as pooled plan providers, 
employee defined contribution pension benefit plans that are operated 
as pooled employer plans, employers participating in such plans, and 
participants and beneficiaries covered by such plans.

DATES: Comments are due on or before October 1, 2020.

ADDRESSES: You may submit written comments, identified by RIN 1210-
AB94, by one of the following methods:
    Federal eRulemaking Portal: https://www.regulations.gov. Follow the 
instructions for submitting comments. To facilitate receipt and 
processing of comments, the Department of Labor encourages interested 
parties to submit their comments electronically.
    Mail: Office of Regulations and Interpretations, Employee Benefits 
Security Administration, Room N-5655, U.S. Department of Labor, 200 
Constitution Ave. NW, Washington, DC 20210, Attention: Proposed 
Registration Requirements for Pooled Plan Providers RIN 1210-AB94.
    Instructions: All submissions must include the agency name and 
Regulatory Identifier Number (RIN) for this rulemaking. Any comment 
that is submitted will be shared with the Internal Revenue Service 
(IRS). If you submit comments electronically, do not submit paper 
copies. Comments will be available to the public, without charge, 
online at https://www.regulations.gov and https://www.dol.gov/agencies/ebsa and at the Public Disclosure Room, Employee Benefits Security 
Administration, Suite N-1513, 200 Constitution Ave. NW, Washington, DC 
20210.
    Warning: Do not include any personally identifiable or confidential 
business information that you do not want publicly disclosed. Comments 
are public records posted on the internet as received and can be 
retrieved by most internet search engines.

FOR FURTHER INFORMATION CONTACT: Colleen Brisport Sequeda, Office of 
Regulations and Interpretations, Employee Benefits Security 
Administration, U.S. Department of Labor, (202) 693-8500 (this is not a 
toll-free number) for questions related to pooled plan provider 
reporting requirements under Title I of ERISA.
    Customer service information: Individuals interested in obtaining 
general information from the Department of Labor concerning Title I of 
ERISA may call the EBSA Toll-Free Hotline at 1-866-444-EBSA (3272) or 
visit the Department's website (www.dol.gov/agencies/ebsa).

SUPPLEMENTARY INFORMATION:

I. Legal Framework

    Under ERISA, an employee benefit plan (whether a pension plan or a 
welfare plan) must be sponsored by an employer, by an employee 
organization, or by both. Section 3(5) of ERISA defines the term 
``employer'' for this purpose as ``any person acting directly as an 
employer, or indirectly in the interest of an employer, in relation to 
an employee benefit plan, and includes a group or association of 
employers acting for an employer in such capacity.'' These definitional 
provisions of ERISA have been interpreted as permitting a multiple 
employer plan (MEP) to be established or maintained by a cognizable, 
bona fide group or association of employers that is controlled by the 
employer members and that acts in the interests of its employer members 
to provide benefits to their employees.\1\ This approach is based on 
the premise that the person or group that maintains the plan is tied to 
the employers and employees that participate in the plan by some common 
economic or representational interest or genuine organizational 
relationship unrelated to the provision of benefits. The Department of 
Labor (Department) has taken steps, through a final rule on 
``association retirement plans'' at 29 CFR 2510.3-55, to clarify and 
expand the types of arrangements that can be treated as multiple 
employer plans under Title I of ERISA. The final rule did not, however, 
extend to so-called ``open MEPs.'' \2\
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    \1\ The SECURE Act did not change the conditions for plans that 
were already permitted under section 3(2) of ERISA to act as a 
single MEP. See, e.g., Advisory Opinions 2008-07A, 2003-17A, and 
2001-04A. Those classes of multiple employer plans (e.g., employer 
association retirement plans and plans sponsored by professional 
employer organizations) are outside of the scope of this rulemaking, 
as are multiple employer plans established and maintained pursuant 
to bona fide collective bargaining.
    \2\ See the preamble discussion in the Final Rule on the 
Definition of ``Employer'' Under Section 3(5) of ERISA--Association 
Retirement Plans and Other Multiple-Employer Plans, 84 FR 37508 
(July 31, 2019). The Department did, however, seek comments through 
a Request for Information published with that proposed rule seeking 
comments on whether, and if so under what conditions, open MEP 
structures should be treated as a multiple employer plan for 
purposes of Title I of ERISA.
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    A primary goal of the Setting Every Community Up for Retirement 
Enhancement Act of 2019 (SECURE Act),\3\ authorizing of pooled employer 
plans was to remove possible barriers to the broader use of multiple 
employer plans. Among other things, the SECURE Act amended section 3(2) 
of ERISA and added section 3(43) to ERISA to authorize a new type of 
ERISA-covered defined contribution pension plan--a ``pooled employer 
plan'' operated by a ``pooled plan provider''--in which multiple 
unrelated employers will be able to participate without the need for 
any commonality among the participating employers or other genuine 
organizational relationship unrelated to participation in the plan, 
thus enabling a type of open MEP. By allowing most of the 
administrative and fiduciary responsibilities of sponsoring a 
retirement plan to be transferred to a ``pooled plan provider,'' the 
pooled employer plan can offer employers, especially small employers, a 
way of offering their employees a workplace retirement savings option 
with reduced burdens and costs compared to sponsoring their own 
separate retirement plan. New section 3(44) of ERISA establishes 
requirements for ``pooled plan providers,'' including a requirement to 
register with the Department and the Department of the Treasury 
(Treasury Department) before beginning operations as a pooled plan 
provider. The effective date for these provisions allows ``pooled 
employer plans'' to begin operating on January 1, 2021.
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    \3\ The SECURE Act was enacted as Division O of the Further 
Consolidated Appropriations Act, 2020 (Pub. L. 116-94) (December 20, 
2019).
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    Under section 3(2) of ERISA, a pooled employer plan is treated for 
purposes of ERISA as a single plan that is a multiple employer plan. A 
``pooled employer plan'' is defined in section 3(43) as a plan that is 
an individual account plan established or maintained for the purpose of 
providing benefits to the employees of two or more employers; that is a 
qualified retirement plan or a plan funded entirely with individual 
retirement accounts (IRA plan); and the terms of which must meet 
certain requirements set forth in the statute.\4\ Specifically, the 
terms of the plan must satisfy the following requirements:
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    \4\ 29 U.S.C. 1002(43). The term ``pooled employer plan'' does 
not include a multiemployer plan or plan maintained by employers 
that have a common interest other than having adopted the plan. The 
term also does not include a plan established before the date the 
SECURE Act was enacted unless the plan administrator elects to have 
the plan treated as a pooled employer plan and the plan meets the 
ERISA requirements applicable to a pooled employer plan established 
on or after such date.
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     Designate a pooled plan provider and provide that the 
pooled plan provider is a named fiduciary of the plan;
     designate one or more trustees (other than an employer in 
the plan) to be responsible for collecting

[[Page 54290]]

contributions to, and holding the assets of, the plan, and require the 
trustees to implement written contribution collection procedures that 
are reasonable, diligent, and systematic;
     provide that each employer in the plan retains fiduciary 
responsibility for the selection and monitoring, in accordance with 
ERISA fiduciary requirements, of the person designated as the pooled 
plan provider and any other person who is designated as a named 
fiduciary of the plan, and the investment and management of the portion 
of the plan's assets attributable to the employees of that employer (or 
beneficiaries of such employees) in the plan to the extent not 
delegated to another fiduciary by the pooled plan provider and subject 
to the ERISA rules relating to self-directed investments;
     provide that employers in the plan, and participants and 
beneficiaries, are not subject to unreasonable restrictions, fees, or 
penalties with regard to ceasing participation, receipt of 
distributions, or otherwise transferring assets of the plan in 
accordance with applicable rules for plan mergers and transfers;
     require the pooled plan provider to provide to employers 
in the plan any disclosures or other information that the Secretary of 
Labor may require, including any disclosures or other information to 
facilitate the selection or monitoring of the pooled plan provider by 
employers in the plan;
     require each employer in the plan to take any actions that 
the Secretary of Labor or pooled plan provider determines are necessary 
to administer the plan or to allow for the plan to meet the ERISA and 
Internal Revenue Code (Code) requirements applicable to the plan, 
including providing any disclosures or other information that the 
Secretary of Labor may require or which the pooled plan provider 
otherwise determines are necessary to administer the plan or to allow 
the plan to meet such ERISA and Code requirements; and
     provide that any disclosure or other information required 
to be provided to participating employers may be provided in electronic 
form and will be designed to ensure only reasonable costs are imposed 
on pooled plan providers and employers in the plan.
    The fidelity bonding requirements in ERISA section 412 apply to 
fiduciaries and other persons handling the assets of a pooled employer 
plan but the maximum bond amount for each such plan official is 
$1,000,000 as compared to the $500,000 maximum that applies in the case 
of other ERISA-covered plans that do not hold employer securities.\5\
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    \5\ The SECURE Act requires that pooled plan providers must 
ensure that all plan fiduciaries and other persons who handle plan 
assets are bonded in accordance with section 412 of ERISA. In the 
Department's view, the SECURE Act confirms that application of ERISA 
section 412 requirements to pooled employer plans, except 
establishing $1,000,000 as the maximum bond amount compared to 
$500,000 for plans that do not hold employer securities, and makes 
clear that the pooled plan provider is subject to the provisions of 
ERISA section 412(b), which provides that ``it shall be unlawful for 
any plan official of such plan or any other person having authority 
to direct the performance of such functions, to permit such 
functions, or any of them, to be performed by any plan official, 
with respect to whom the requirements of subsection (a) [of ERISA 
section 412] have not been met.'' Thus, in the Department's view, 
the normal section 412 rules for ERISA plans govern the bonding 
requirements for pooled employer plans. See 29 CFR 2550.412-1, 29 
CFR part 2580; see also Field Assistance Bulletin 2008-04 (providing 
a general description of statutory and regulatory requirements for 
bonding). For example, the Department does not read the SECURE Act 
as broadening the section 412 bonding rules to apply to persons who 
handle plan assets regardless of whether they handled plan funds or 
other property within the meaning of section 412. Similarly, the 
existing statutory and regulatory exemptions for certain banks, 
insurance companies, and registered broker-dealers continue to 
apply.
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    A ``pooled plan provider'' with respect to a pooled employer plan 
is defined in ERISA section 3(44) to mean a person that meets the 
following requirements:
     Is designated by the terms of the plan as a named 
fiduciary under ERISA, as the plan administrator, and as the person 
responsible to perform all administrative duties (including conducting 
proper testing with respect to the plan and the employees of each 
employer in the plan) that are reasonably necessary to ensure that the 
plan meets the Code requirements for tax-favored treatment and the 
requirements of ERISA and to ensure that each employer in the plan 
takes actions as the Secretary or the pooled plan provider determines 
necessary for the plan to meet Code and ERISA requirements, including 
providing to the pooled plan provider any disclosures or other 
information that the Secretary may require or that the pooled plan 
provider otherwise determines are necessary to administer the plan or 
to allow the plan to meet Code and ERISA requirements;
     acknowledges in writing its status as a named fiduciary 
under ERISA and as the plan administrator;
     is responsible for ensuring that all persons who handle 
plan assets or are plan fiduciaries are bonded in accordance with ERISA 
requirements; and
     registers as a pooled plan provider.
    The SECURE Act specifies that the Secretary may perform audits, 
examinations, and investigations of pooled plan providers as may be 
necessary to enforce and carry out the purposes of the provision. The 
SECURE Act also directs the Department to issue such guidance as it 
determines appropriate to carry out the pooled employer plan and pooled 
plan provider provisions, including guidance (1) to identify the 
administrative duties and other actions required to be performed by a 
pooled plan provider, and (2) that provides, in appropriate cases 
involving a noncompliant employer, for transfer of plan assets 
attributable to employees of the noncompliant employer (or 
beneficiaries of such employees) to a plan maintained only by that 
employer (or its successor), to a tax-favored retirement plan for each 
individual whose account is transferred, or to any other arrangement 
that the Department determines is appropriate, and for the noncompliant 
employer (and not the plan with respect to which the failure occurred 
or any other employer in the plan) to be liable for any plan 
liabilities attributable to employees of the noncompliant employer (or 
beneficiaries of such employees), except to the extent provided in the 
guidance. An employer or pooled plan provider is not treated as failing 
to meet a requirement of guidance issued by the Secretary if, before 
the issuance of such guidance, the employer or pooled plan provider 
complies in good faith with a reasonable interpretation of the 
provisions to which the guidance relates.
    The SECURE Act also provides that the Form 5500 annual return/
report of employee benefit plan (Form 5500) filing for a multiple 
employer plan subject to section 210 of ERISA, including a pooled 
employer plan, must include a list of the employers in the plan, a good 
faith estimate of the percentage of total contributions made by such 
employers during the plan year, the aggregate account balances 
attributable to each employer in the plan (determined as the sum of the 
account balances of the employees of each employer and the 
beneficiaries of such employees) and, with respect to a pooled employer 
plan in particular, the identifying information for the person 
designated under the terms of the plan as the pooled plan provider. In 
addition, the provision authorizes the Department to prescribe 
simplified reporting for pooled employer plans that cover fewer than 
1,000 participants, but only if no single employer in the plan has 100 
or more participants covered by the plan.
    The SECURE Act does not limit the class of persons who can act as 
pooled plan providers, but it is expected that

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financial services companies (such as insurance companies, banks, trust 
companies, consulting firms, record keepers, and third-party 
administrators) will be the primary sponsors of pooled employer plans. 
As noted above, however, section 3(44) does require as a condition of 
being a pooled plan provider that the person ``registers as a pooled 
plan provider with the Secretary, and provides to the Secretary such 
other information the Department may require, before operations as a 
pooled plan provider.'' \6\
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    \6\ ERISA section 3(44)(a)(ii).
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    In the Department's view, the statutory purpose of the registration 
requirement is to provide the Department with sufficient information 
regarding persons acting as pooled plan providers to engage in 
effective monitoring and oversight of this new type of ERISA retirement 
plan. Although the Department does not have specific details as to how 
pooled employer plans authorized under the SECURE Act will be 
structured or operated, the Department has assumed that they may be 
similar to other currently operating multiple employer plans. 
Additionally, there may be challenges associated with these new types 
of multiple employer plans that the Department, the Treasury 
Department, or IRS, as the federal agencies charged with oversight of 
private-sector pension plans, may need to address. The SECURE Act 
expressly provides that participating employers will retain certain 
residual fiduciary responsibilities, including for the selection and 
oversight of the pooled plan provider and the plan's other named 
fiduciaries. This raises concerns that the potential for inadequate 
employer oversight of the activities of a pooled employer plan and its 
plan fiduciaries and other service providers may be greater than for 
other plans sponsored by an employer because the nature of the plan 
involves participating employers passing along more responsibility to 
the pooled plan provider than they do in other plan arrangements.
    The registration process and requirements must enable the 
Department to identify pooled plan providers when they begin operating 
and effectively oversee their actions and the pooled employer plans 
they operate. While pooled plan providers will be required to file 
Forms 5500 for the pooled employer plans they operate, Forms 5500 
generally are not filed until seven to nine-and-a-half months after the 
end of the plan year.\7\ In the absence of appropriate detail in the 
registration statement, a pooled plan provider could begin operating 
multiple plans with hundreds or thousands of participants and millions 
of dollars without the agencies having any information about the pooled 
employer plans for almost two years.
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    \7\ Title I and Title IV of ERISA and the Code establish annual 
reporting requirements for employee benefit plans. DOL, the Treasury 
Department (specifically the IRS), and the Pension Benefit Guaranty 
Corporation jointly developed the Form 5500 so employee benefit 
plans could use one form to satisfy annual reporting requirements 
under ERISA and the Code. The Form 5500 is part of ERISA's overall 
reporting and disclosure framework, helping to assure that employee 
benefit plans are operated and managed in accordance with certain 
prescribed standards and that participants and beneficiaries, as 
well as regulators, are provided or have access to sufficient 
information to protect the rights and benefits of plan participants 
and beneficiaries.
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    In determining how best to implement the statutory registration 
requirement, the Department considered a number of alternatives with 
respect to any registration statement requirement including whether it 
must be filed when the provider begins operations in anticipation of 
operating one or more pooled employer plans, when it begins operating 
each individual pooled employer plan, or both. The Department also does 
not believe that the SECURE Act provisions preclude or were intended to 
preclude the Department from imposing reasonable ongoing reporting 
requirements to enable the Department to effectively oversee pooled 
plan providers and the pooled employer plans they operate. Therefore, 
as discussed in more detail below, relying on the language in the 
SECURE Act requiring a registration statement as well as on its broad 
authority under section 505 of ERISA to prescribe regulations,\8\ 
including forms, to enable the Department to carry out its statutory 
oversight mission, the Department has chosen the structure set out in 
the proposal.
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    \8\ Section 505 of ERISA provides generally that the Secretary 
may prescribe such regulations the Secretary ``finds necessary or 
appropriate to carry out the provisions of this subchapter. Among 
other things, such regulations may define accounting, technical and 
trade terms used in such provisions; may prescribe forms; and may 
provide for the keeping of books and records, and for the inspection 
of such books and records (subject to section 1134(a) and (b) of 
this title).'' 29 U.S.C. 1135.
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    The proposal would require an initial registration filing and 
supplemental filings to report changes in the information in the 
initial filing, information about each specific pooled employer plan 
before initiation of operations, and information on specified 
reportable events, time-sensitive knowledge of which are important for 
the Department, the Treasury Department, and the IRS to carry out 
oversight and for participating employers to be able to exercise their 
fiduciary duties of selection and monitoring. The proposal would 
require a final filing once the last pooled employer plan has been 
terminated and ceased operations.
    The Department believes that the initial registration, supplemental 
filing, and final filing requirements, when combined with the Form 5500 
annual reporting requirements, will give the Department the timely 
access to pooled plan provider information needed to fulfill the 
monitoring and oversight tasks the SECURE Act placed on the agencies 
and would be less burdensome and less costly for pooled plan providers 
and pooled employer plans than some alternatives that were considered. 
The Department is also proposing to establish a new EBSA form--EBSA 
Form PR (Pooled Plan Provider Registration) (Form PR)--as the required 
filing format for pooled plan provider registrations as a way to 
facilitate compliance with the regulatory registration requirements. 
Filing the proposed Form PR is intended to satisfy the respective 
requirements under Title I of ERISA and the Code to register with both 
the Department and the Treasury Department.
    This proposed rule is expected to be an Executive Order (E.O.) 
13771 deregulatory action. Details on the estimated effects of this 
proposed rule can be found in the economic analysis.

II. Registration Requirements for Pooled Plan Providers

    Specifically, as described above, the SECURE Act expressly provides 
a requirement to register as a pooled plan provider and a separate 
authorization for the Department to require reporting of other 
information. The SECURE Act did not include specific content 
requirements for the pooled plan provider registration. The Department 
is proposing that the first part of the process be an initial 
``registration'' filing of basic identifying information about the 
pooled plan provider and some information, for example, about its 
structure, affiliated service providers, marketing activities, and 
pending legal or regulatory proceedings. The second part is a 
supplemental filing requirement intended to provide the agencies, 
participating employers and employees, and the public information about 
reportable events, which would include any change in the information 
filed as part of the initial registration and also significant 
financial and

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operational events related to the pooled plan provider and the pooled 
employer plans it sponsors.

A. Initial Registration

    For purposes of the initial registration, the Department proposes 
to define ``beginning operations as a pooled plan provider'' to mean 
publicly marketing pooled plan provider services or publicly offering a 
pooled employer plan. In the Department's view, an important purpose of 
the requirement to register before beginning operations as a pooled 
plan provider is to provide the Department, the Treasury Department, 
the IRS, prospective employer customers, and the public with notice and 
relevant information about the pooled plan provider. Accordingly, the 
initiation of public marketing services as a pooled plan provider or 
publicly offering one or more pooled employer plans are important 
registration triggers. The Department does not intend to require 
registration as a result of preliminary business activities, such as 
establishing the business organization, creating a business plan, 
obtaining necessary licenses or entering into contracts with 
subcontractors or partners, obtaining an federal employer 
identification number, or actions and communications designed to 
evaluate market demand in advance of publicly marketing pooled plan 
provider services or publicly offering one or more pooled employer 
plans.
    As noted above, the SECURE Act left it to the agencies' discretion 
to establish specific content requirements for the pooled plan provider 
registration. In developing this proposal, the Department focused on 
information needed by the agencies to identify, contact, and engage in 
timely oversight of pooled plan providers, as well as on the 
information that the Department could post on its website that would 
provide employers considering participating in a pooled employer plan, 
participating employees, covered employees, and other interested 
stakeholders the ability to identify, contact, and do some due 
diligence on pooled plan providers. The Department also considered the 
content requirements of other registration requirements under federal 
and state securities laws for investment advisers and broker-dealers. 
For example, among other information, registrations require disclosures 
of identifying and contact information, background information about 
the registrant's business, information about relevant management 
policies, names of executives and general partners, relevant legal 
proceedings and previous violations, and relevant negative information, 
such as legal problems or other business events or trouble that would 
be of consequence to users of the registration information. The 
Department also focused on minimizing the administrative burden and 
expense involved for pooled plan providers and the pooled employer 
plans they operate.
    Based on those considerations, the Department is proposing that a 
prospective pooled plan provider would need to file the following 
information 30 to 90 days before beginning operations as a pooled plan 
provider:
    1. Legal Business Name and any Trade Name (Doing Business As).
    2. Federal Employer Identification Number (EIN). An EIN is a nine-
digit employer identification number (for example, 00-1234567) that has 
been assigned by the IRS. Entities that do not have an EIN may apply 
for one on Form SS-4, Application for Employer Identification Number. 
The Form SS-4 is available by calling 1-800-829-4933 or going to the 
IRS website at https://www.irs.gov/pub/irs-pdf/fss4.pdf. EIN data is 
important for accurately identifying registrants and cross-referencing 
information reported about the registrant on other filings, such as the 
Form 5500 filed by the pooled employer plans operated by the 
registrant.
    3. Business Telephone. We expect that pooled plan providers, like 
many or most existing 401(k) providers, will operate a call center 
designed to handle inquiries from employers interested in or already 
participating in a pooled employer plan as well as participants and 
beneficiaries covered by plans operated by the registrant. The separate 
requirement to provide contact information for the registrant's 
principal compliance officer gives the Department and others with 
compliance concerns a means of contacting a responsible person at the 
registrant. The business telephone number requirement is focused mainly 
on including in the public Form PR data that the Department will post 
on its website a way for interested/participating employers and covered 
employees to contact the pooled plan provider for information. As such, 
we are soliciting comments on whether this data element should allow a 
call center number to be reported as the business telephone number.
    4. Business Mailing Address.
    5. Address of any public website or websites of the pooled plan 
provider or any affiliates to be used to market any such person(s) as a 
pooled plan provider to the public or to provide public information on 
the pooled employer plan operated by the pooled plan provider. The 
Department believes this information will be useful in the Department's 
oversight of pooled plan providers and will also assist employers 
performing due diligence in selecting and monitoring pooled employer 
plans. The Department also expects that most pooled plan providers will 
have such websites, and believes that having information on such 
websites provides an alternative to requiring more information to be 
submitted as part of the registration process.
    6. The name, mailing address, telephone number, and email address 
for the primary compliance officer of the pooled plan provider. The 
Department believes it is important that it, as well as participating 
employers and covered employees, have an effective means of 
communicating with a responsible person at the pooled plan provider 
regarding compliance questions or concerns. The Department is proposing 
that the registration include an email address for the compliance 
officer, but solicits comments on whether alternative or additional 
means of contacting the compliance offer should be included in the 
registration.
    7. The agent for service of legal process for the pooled plan 
provider, and the address at which process may be served on such agent, 
and in addition, a statement that service of legal process may be made 
upon the pooled plan provider. The proposal would allow either a person 
or a process service company to be identified as the agent for service 
of legal process.
    8. The approximate date when pooled plan operations are expected to 
commence. The SECURE Act requires that the registration must be filed 
before the pooled plan provider begins operations. Accordingly, this 
data element is important to enable the Department to ensure compliance 
with the SECURE Act requirement. As noted elsewhere, the Department is 
proposing that the registration be filed not more than 90 or less than 
30 days before the pooled plan provider begins operations.
    9. A description of administrative and investment services that 
will be offered or provided by the pooled plan provider, including 
identification of any affiliates expected to have a role in the 
provision of those administrative and investment services, and a 
description of the roles of such affiliates. For this purpose, the term 
``affiliates'' includes all persons who are treated as a single 
employer with the person intending to be a pooled plan provider under 
section 414(b), (c), (m), or (o) of the Code and are expected to 
provide services to pooled employer plans sponsored by the

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pooled plan provider, and any officer, director, partner, employee, or 
relative (as defined in section 3(15) of the Act) of such person; and 
any corporation or partnership of which such person is an officer, 
director, or partner. Information regarding when various plan services 
will be provided by the pooled plan provider or any affiliate will 
assist the Department and prospective participating employers evaluate 
the pooled plan provider and whether there are potentials for conflicts 
of interest with respect to the operations or investments of any pooled 
employer plans to be operated by the provider.
    10. A statement disclosing any federal or state criminal conviction 
related to the provisions of services to, operation of, or investments 
of, any employee benefit plan against the pooled plan provider, or any 
officer, director, or employee of a pooled plan provider, if the 
conviction, or related term of imprisonment served, is within ten years 
of the date of the registration. In the Department's view, this data 
element focuses on relevant legal proceedings, previous violations, and 
relevant negative information that will be useful in the Department's 
oversight of pooled plan providers. For example, under ERISA section 
411, the Department is responsible for ensuring disqualified parties do 
not serve in positions or capacities prohibited under the statute. 
Although this question is intentionally presented without all the 
technical provisions and specifications in section 411 of ERISA, that 
statutory provision prohibits individuals convicted of disqualifying 
crimes from serving in plan-related capacities during or for a period 
of 13 years after such conviction or the end of imprisonment, whichever 
is later, subject to some provisions allowing that period to be 
shortened.\9\ This data would also assist employers performing due 
diligence in selecting and monitoring pooled employer plans. The 
Department solicits comments on whether civil judgments should be 
included here, and if, so whether the requirement with respect to civil 
judgments should be further limited to just certain types of civil 
judgments, e.g., those involving claims of fraud or dishonesty with 
fraud or dishonesty defined similarly to those terms in the fidelity 
bonding provisions in ERISA section 412 and the Department's 
implementing regulations.
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    \9\ See also Beck v. Levering, 947 F.2d 639 (2d Cir. 1991) (in a 
civil action, permitting lifetime injunction against an individual 
from providing services to ERISA plans).
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    11. A statement disclosing any ongoing criminal, civil, or 
administrative proceedings related to the provisions of services to, 
operation of, or investments of any employee benefit plan, in any court 
or administrative tribunal by the federal or state government or other 
regulatory authority against the pooled plan provider or any officer, 
director, or employee of the pooled plan provider. As with the 
information on criminal convictions, this data element focuses on 
relevant legal proceedings, previous violations, and relevant negative 
information that will be useful in the Department's oversight of pooled 
plan providers and will also assist employers performing due diligence 
in selecting and monitoring pooled employer plans.

B. Reportable Event Supplemental Filings

    Before the pooled plan provider initiates operations of a pooled 
employer plan, the proposal would require the pooled plan provider to 
submit a supplemental filing with the name, trustee identification 
information, and EIN for the plan. The timing of this requirement 
arises from Code section 413(e)(3), which provides that the 
requirements to be a pooled plan provider (including the requirement to 
register with the Secretary of the Treasury before beginning operations 
as a pooled plan provider) must be satisfied ``with respect to any 
plan.''
    The proposal would also require additional filings for (i) any 
changes in the previously reported registration information and (ii) 
specified events affecting either the pooled plan provider or a plan it 
sponsors that may signal financial problems or other circumstances that 
could potentially put the pensions of covered employees at risk.\10\ 
These supplemental filings would provide important information to the 
Department, the Treasury Department, and the IRS to help them protect 
plan participants and beneficiaries and conduct more effective 
monitoring and oversight of pooled employer plans and pooled plan 
providers. Without this kind of timely information, the agencies would 
typically not learn of risks to a pooled employer plan until the plan 
files a Form 5500, possibly many months after the event and when 
opportunities for protecting plan participants from financial injury 
have been missed. Reporting changes in the previously filed 
registration information also will help the Department ensure that the 
information regarding pooled plan providers posted on its website and 
available to the public is up to date. Otherwise the Department, 
employers, and the public would have to rely on outdated information 
until a Form 5500 was filed for the plan and then would need to compare 
the registration information with the subsequently filed information 
about pooled plan providers in Forms 5500 submitted by the pooled plan 
provider on behalf of the pooled employer plans the providers operate 
and have to rely on outside sources to determine which information is 
correct.
---------------------------------------------------------------------------

    \10\ If only correcting a mistake in a previous filing, the 
person should indicate that on the form by checking the box for an 
amended filing instead. See discussion in Section II.C.
---------------------------------------------------------------------------

    Therefore, pooled plan providers would need to disclose certain 
changes in a supplemental filing within 30 days of the occurrence of 
the change. These changes are:
    1. Any change in the registration information previously reported 
by the pooled plan provider. In the Department's view, it is important 
that the registration information it has, and that it posts on its 
website, be accurate and up to date. The Department intends that the 
filing system for the pooled plan provider registrations will enable 
registrants submitting a supplemental filing to complete the basic 
identifying information regarding the registrant and update only those 
parts of the registration with a change in the required information.
    2. Any one of the following changes in circumstances of the pooled 
plan provider:
    (i) Significant change in the corporate or business structure of 
the pooled plan provider, e.g., merger, acquisition. As noted above, 
the Department considered other registration regimes in developing this 
proposal, and some included data collections regarding business events 
or trouble that would be of consequence to users of the registration 
information. In the Department's view, a significant change in the 
pooled plan provider's corporate structure could have consequences that 
affect the pooled employer plans as well as participating employers and 
covered employees and could also give rise to possible conflicts of 
interest that would not have existed in the absence of the transaction.
    (ii) Initiation of bankruptcy, receivership, or other insolvency 
proceeding for the pooled plan provider or an affiliate, or ceasing all 
operations as a pooled plan provider. It is important for both 
participating employers and the agencies charged with oversight of 
pooled plan providers and pooled employer plans to have information 
about insolvency proceedings as soon as is reasonably practicable to 
make sure that the

[[Page 54294]]

interests of participants and beneficiaries are protected. The 
Department already has a REACT project whose aim is to respond in an 
expedited manner to protect the rights and benefits of plan 
participants when the plan sponsor faces severe financial hardship or 
bankruptcy and the assets of the employee benefit plan are in jeopardy. 
Under REACT, when a company has declared bankruptcy, the Department's 
goal is to take immediate action to (1) ascertain whether there are 
plan contributions which have not been paid to the plans' trust, (2) 
advise all affected plans of the bankruptcy filing, and (3) provide 
assistance in filing proofs of claim to protect the plans, the 
participants, and the beneficiaries. EBSA also attempts to identify the 
assets of the responsible fiduciaries and evaluate whether a lawsuit 
should be filed against those fiduciaries to ensure that the plans are 
made whole and the benefits secured. The Department expects that it 
will either expand the REACT program or establish a similar program 
specifically designed for pooled plan providers and pooled employer 
plans, and this supplemental reportable event information would be 
important.
    (iii) Receiving written notice of the initiation of any 
administrative or enforcement action in any court or administrative 
tribunal by any federal or state governmental agency or other 
regulatory authority against the pooled plan provider or any officer, 
director, or employee of the pooled plan provider, related to the 
provision of services to, operation of, or investments of any pooled 
employer plan. Timely knowledge of such actions will help the agencies 
fulfill their oversight functions and also assist prospective and 
existing participating employers properly carry out their duties under 
the SECURE Act provisions with respect to selection and monitoring of 
pooled employer plans. For purposes of the registration, employees of 
the pooled plan provider would include employees of the pooled employer 
plan, but only those who handle assets of the plan within the meaning 
of section 412 of ERISA or who are responsible for the operations or 
investments.
    (iv) Receiving written notice of a finding of fraud or dishonesty 
by federal or state court or a federal or state governmental agency 
related to the provision of services to, operation of, or investments 
of any pooled employer plan or other employee benefit plan against the 
pooled plan provider or any officer, director, or employee of the 
pooled plan provider. As with information regarding actions by 
governmental agencies or other regulatory authorities against the 
provider, information about court or governmental agency findings of 
fraud or dishonesty in connection with the provision of services to, 
operation of, or investments of any employee benefit plan is important 
for agency oversight and for participating employers with respect to 
their duties under the SECURE Act provisions regarding selection and 
monitoring of the pooled employer plans.
    (v) Receiving written notice of the filing of any federal or state 
criminal charges related to the provision of services to, operation of, 
or investments of any pooled employer plan or other employee benefit 
plan against the pooled plan provider or any officer, director, or 
employee of the pooled plan provider Such actions, too, are relevant to 
the selection and monitoring obligations of participating employers, 
and while ERISA section 411 bars serving as an ERISA fiduciary 
following a wide range of crimes, this information is limited to those 
criminal charges related to the provision of services to, operation of, 
or investments of any pooled employer or other employee benefit plan.

C. Amendment and Correction of Registration Information

    The Department intends that the filing system for registrations, 
similar to that for the Form 5500, will allow pooled plan providers the 
ability to file corrections and amendments of their registration and 
reportable event filings. The Department does not believe that it would 
be appropriate to read the SECURE Act in a way that would result in 
inadvertent or good faith errors in registrations resulting in a 
failure to register and a consequent nullification of the person's 
status as a person authorized to act as a pooled plan provider. Thus, 
under the proposal, inadvertent or good faith errors and omissions in a 
filing's content generally would not be treated as a failure to 
register, provided that a corrected or amended filing is submitted 
within a reasonable period of the discovery of the error or omission. 
If only correcting information previously reported, such as if an 
incorrect name was entered for an affiliate of the pooled plan 
provider, a person would indicate on the form that the filing is an 
amended filing, not a supplemental filing.
    Further, the Department expects at a later date to propose new 
questions on the Form 5500 that would ask whether a pooled plan 
provider filed its registration statement with the Secretary, including 
any required updates, and to report the electronic confirmation number 
provided to the pooled plan provider at the time that the registration 
was received. These would be similar to the questions currently on the 
Form 5500 that require reporting by multiple employer group health 
plans about their compliance with registration and reporting 
requirements on the Form M-1 (Report for Multiple Employer Welfare 
Arrangements (MEWAs) and Certain Entities Claiming Exception (ECEs)). 
The questions would provide the Department, the Treasury Department, 
the IRS, participating employers, and other stakeholders with 
information that would allow them to connect the Form PR registration 
with the Form 5500 for all pooled employer plans operated by the 
registrant.

D. Final Filing

    As proposed, if a pooled plan provider has ceased operating all 
pooled employer plans and has filed a supplemental reportable event 
filing to indicate that the last pooled employer plan for which it 
served as the pooled plan provider has been terminated and ceased 
operating, the provider would be required to file a final registration 
filing. For this purpose, a plan would be treated as terminated and 
having ceased operations when a resolution has been adopted terminating 
the plan, all assets under the plan (including insurance/annuity 
contracts) have been properly distributed to the participants and 
beneficiaries or legally transferred to the control of another plan, 
and when a final Form 5500 has been filed for the plan. The final Form 
PR filing would be due within 30 days of the filing of the last final 
Form 5500 for the last pooled employer plan the provider operates. A 
single combined filing may be used both to report that the last pooled 
employer plan operated by the provider has been terminated and ceased 
operating and to serve as the final Form PR filing by the pooled plan 
provider. The final filing is intended to assist the Department's 
maintenance of an accurate database of persons serving as pooled plan 
providers and provision of accurate public information about pooled 
plan providers to employers, participants, beneficiaries, and other 
interested persons.

E. Electronic Filing

    This proposal also includes a provision to require electronic 
filing of all pooled plan provider registrations with the Department. 
The Department believes that regular mail is not the most efficient or 
cost-effective way to file and process these notices and statements. 
Because the internet is widely

[[Page 54295]]

accessible to persons who file these notices and statements, the 
Department expects that persons interested in being pooled plan 
providers will find electronic filing easier and more cost-effective 
than paper filing. The submission process would also assist pooled plan 
providers by ensuring that all of the required information would be 
included in the registration before the electronic filing could be 
completed through the internet site. In addition, as previously 
mentioned, the process would provide an electronic registration 
confirmation receipt to the pooled plan provider. Electronic filing 
should also facilitate the disclosure of the information to 
participating employers, covered participants and beneficiaries, and 
other interested members of the public. Once a registration statement 
is filed, the data would be posted on the Department's website and be 
available to the public. Thus, the Department believes that filers and 
data users all stand to benefit from electronic filing in ways that are 
consistent with the goals of the E-Government Act of 2002.\11\
---------------------------------------------------------------------------

    \11\ Public Law 107-347, sec. 2 (Dec. 17, 2002).
---------------------------------------------------------------------------

    The Department plans to use the same system and registration 
process for filing the pooled plan provider registration that plan 
administrators currently use, and that pooled plan providers will use, 
to file the Form 5500 for employee benefit plans, including pooled 
employer plans.
    Under ERISA Section 505, in addition to having the authority to 
prescribe such regulations the Department determines may be necessary 
or appropriate to carry out the provisions of Title I of ERISA, the 
Department has the authority to prescribe forms. Pursuant to that 
authority, the Department is proposing a new EBSA form--Form PR. The 
proposed form and the accompanying instructions would be the required 
filing format for pooled plan provider registrations and would 
facilitate the regulatory registration requirements proposed in this 
document. The proposed form and instructions are attached as Appendix 
A.
    The pooled plan provider registration form and instructions, like 
other Department forms, will undergo OMB review under the Paperwork 
Reduction Act of 1995 (PRA), and be assigned an OMB Control number 
prior to being published for use. The volume of pooled plan provider 
registration filings is unknown but as discussed in detail in the 
regulatory impact analysis, the Department assumes for purposes of this 
proposal that fewer than 5,000 persons will register initially as 
pooled plan providers.

F. Coordination With the Treasury Department and the Internal Revenue 
Service

    As noted above, the SECURE Act requires pooled plan providers to 
register with the Department as well as with the Treasury Department 
and the IRS. The Department coordinated with those agencies to develop 
this proposal. They have advised that filing the registration statement 
with the Department, including the supplemental statement identifying a 
pooled employer plan for which the pooled plan provider is acting in 
that capacity prior to the initiation of operations of each such plan, 
will also satisfy the Code requirement to register as a pooled plan 
provider with respect to that plan. The Department will continue to 
consult with the Treasury Department and the IRS in connection with 
their development of the pooled plan provider registration requirements 
and filing process.

G. Request for Public Comments

    The Department invites comments from interested persons on all 
facets of the proposed rule. Commenters are free to express their views 
not only on the specific provisions of the proposal as set forth in 
this document, but on other issues germane to the subject matter of the 
proposal. The Department also requests comment on the following 
questions:
    1. Is the definition of ``beginning operations as a pooled plan 
provider,'' which determines whether initial registration is required, 
appropriate in scope? Should the definition exclude marketing and 
solicitation efforts so that the initial registration is tied solely to 
beginning operation of a pooled employer plan? Should the deadlines for 
filing an initial registration be nearer to the date of actual public 
marketing activities if the pooled plan provider intends only to engage 
in marketing and solicitation efforts, and will not enroll any employer 
or employee in a pooled employer plan until at least 30 days after 
initial registration?
    2. Are there any additional classes of information or types of 
reportable events that should be included in the registration 
requirement?
    3. Is there a more efficient or effective way of collecting 
reportable event information that would reduce administrative burdens 
and expenses?
    4. Could the burden associated with the collection of reportable 
event information be reduced by better aligning the collection with 
other disclosure requirements for pooled plan providers?
    5. Are there other federal or state filings for insurance 
companies, banks, and other financial institutions, such as the Form 
ADV (or similar Securities and Exchange Commission (SEC) or State 
registration forms) for financial advisors, on which the Department 
could rely as an alternative source of information about pooled plan 
providers and the plans they operate?
    6. Are there particular forms or numbers (e.g., Form ADV, SEC 
registration number, Central Registration Depository number, or 
National Association of Insurance Commissioners Code) that could be 
referenced in the registration that would, with nominal burden, help 
employers find more information about pooled plan providers and compare 
providers across platforms of available information?
    7. Should the disclosure of ``ongoing criminal, civil, or 
administrative proceedings related to the provisions of services to, 
operation of, or investments of any employee benefit plan by the pooled 
plan provider'' be expanded? For example, would disclosing settlements 
of fiduciary liability claims against pooled plan providers with the 
Department or PBGC, including settlements under ERISA Sec.  
206(d)(4)(A)(iii), assist employers performing due diligence in 
selecting and monitoring pooled employer plans?
    Comments should be submitted in accordance with the instructions at 
the beginning of this document. The Department believes that 30 days 
will afford interested persons an adequate amount of time to analyze 
the proposed rule and submit comments.
Regulatory Impact Analysis
    Summary--The SECURE Act was enacted to expand retirement savings. 
Section 101 of the SECURE Act amends section 3(2) of ERISA to eliminate 
the commonality of interest requirement for establishing certain 
individual account plans, or ``pooled employer plans,'' that meet 
specific requirements. Among these requirements, such plans must 
designate a ``pooled plan provider'' to serve as a named fiduciary and 
as the plan administrator. Further, section 101 of the SECURE Act 
requires pooled plan providers to register with the Department and the 
Treasury Department before beginning operations. The statute expressly 
provides a separate authorization for the Department to require 
additional information.
    The Department has examined the effects of this rule as required by

[[Page 54296]]

Executive Order 12866,\12\ Executive Order 13563,\13\ the Congressional 
Review Act,\14\ Executive Order 13771,\15\ the Paperwork Reduction Act 
of 1995,\16\ the Regulatory Flexibility Act,\17\ section 202 of the 
Unfunded Mandates Reform Act of 1995,\18\ and Executive Order 
13132.\19\
---------------------------------------------------------------------------

    \12\ Regulatory Planning and Review, 58 FR 51735 (Oct. 4, 1993).
    \13\ Improving Regulation and Regulatory Review, 76 FR 3821 
(Jan. 18, 2011).
    \14\ 5 U.S.C. 804(2) (1996).
    \15\ Reducing Regulation and Controlling Regulatory Costs, 82 FR 
9339 (Jan. 30, 2017).
    \16\ 44 U.S.C. 3506(c)(2)(A) (1995).
    \17\ 5 U.S.C. 601 et seq. (1980).
    \18\ 2 U.S.C. 1501 et seq. (1995).
    \19\ Federalism, 64 FR 153 (Aug. 4, 1999).
---------------------------------------------------------------------------

1.1. Executive Orders
    Executive Orders 12866 and 13563 direct agencies to assess all 
costs and benefits of available regulatory alternatives and, if 
regulation is necessary, select regulatory approaches that maximize net 
benefits (including potential economic, environmental, public health, 
and safety effects; distributive impacts; and equity). Executive Order 
13563 emphasizes the importance of quantifying costs and benefits, 
reducing costs, harmonizing rules, and promoting flexibility.
    Under Executive Order 12866, ``significant'' regulatory actions are 
subject to review by the Office of Management and Budget (OMB).\20\ 
Section 3(f) of the Executive Order defines a ``significant regulatory 
action'' as an action that is likely to produce a rule that does any of 
the following:
---------------------------------------------------------------------------

    \20\ Regulatory Planning and Review, supra note 2.
---------------------------------------------------------------------------

    (1) Has an annual effect on the economy of $100 million or more in 
any one year, or adversely and materially affects a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or state, local or tribal governments or communities 
(also referred to as ``economically significant'');
    (2) creates a serious inconsistency or otherwise interferes with an 
action taken or planned by another agency;
    (3) materially alters the budgetary impacts of entitlement grants, 
user fees, or loan programs or the rights and obligations of recipients 
thereof; or
    (4) raises novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order.
    A full regulatory impact analysis must be prepared for major rules 
with economically significant effects (for example, $100 million or 
more in any one year), and OMB reviews ``significant'' regulatory 
actions. OMB determined that this rule is not economically significant 
within the meaning of section 3(f)(1) of the Executive Order but is 
significant under 3(f)(4). Therefore, the Department has provided an 
assessment of the potential costs, benefits, and transfers associated 
with this proposed rule. In accordance with the provisions of Executive 
Order 12866, OMB has reviewed this proposed rule.
1.2. Introduction and Need for Regulation
    As added by the SECURE Act, section 3(44) of ERISA requires a 
person to register as a pooled plan provider with the Secretary, and 
provide other information the Secretary may require, before operating a 
pooled employer plan. These proposed rules respond to the direction 
given to the Secretary in the SECURE Act and provide the requirements 
for registering with the Secretary.
    The required information allows the Department to identify pooled 
plan providers so that it may monitor their actions. While the Form 
5500, which pooled plan providers will also be required to file, 
collects such information, Form 5500 reporting is generally unavailable 
for more than 18 months after a plan starts. The SECURE Act's 
registration requirements give the Department more immediate access to 
pooled plan provider information, allowing it to observe how this new 
market develops and assess the need for further guidance.
1.3. Affected Entities
    The goal of the SECURE Act is to increase retirement savings, in 
particular by expanding the options for small employers to participate 
in multiple employer plans. The Department expects this expansion to 
produce administrative savings and new investment opportunities for 
many small employers. Section 101 of the SECURE Act allows commercial 
service providers to serve as the plan administrator and a named 
fiduciary of defined contribution pension plans of more than one 
unrelated employer. Expanding the ways in which service providers and 
employers may craft and join multiple employer plans should reduce 
costs and administrative burdens for participating employers. Rather 
than sponsoring individual plans with separate Form 5500 filing and 
audit requirements, a single Form 5500 filing by the pooled plan 
provider would satisfy the annual reporting requirement for all the 
participating employers. Pooled plan providers would be both a named 
fiduciary and plan administrator for the pooled employer plan, and they 
would be required to register with the Department before operating any 
such plans.
    The Department has identified certain existing entities that it 
believes would be most likely to serve as pooled plan providers. For 
example, recordkeepers that currently administer retirement plans may 
be well positioned to serve as pooled plan providers and some 
recordkeepers have affiliated entities that may seek to provide 
investment alternatives and services to the plan. Similarly, many 
Professional Employer Organizations (PEOs) have served as plan 
administrators and would likely have little trouble taking on the role 
of pooled plan provider. Further, insurance companies have expressed 
interest in serving as pooled plan providers and some have prior 
experience providing similar services. Chambers of Commerce have 
connections with employers, but many are small with few full-time 
staff. Also, few Chambers of Commerce have sponsored MEWAs. While 
retirement plan advisors such as broker-dealers and registered 
investment advisers are also plausible candidates, the Department 
believes that many would be reluctant to assume the named fiduciary and 
plan administrator roles. Entities such as registered investment 
advisors may likely be more comfortable serving as section 3(38) 
investment managers for the pooled plan providers.
    Given these assumptions, the Department currently estimates that 
roughly 3,200 unique entities will initially register to serve as 
pooled plan providers. Recordkeepers and plan administrators of 
existing defined contribution plans are most likely to enter the 
market, followed by PEOs, direct annuity writers, chambers of commerce, 
and plan advisors.

[[Page 54297]]



                                         Estimated Pooled Plan Provider
----------------------------------------------------------------------------------------------------------------
                                                                                  Expected share     Estimated
                                                                     Universe            %            number
----------------------------------------------------------------------------------------------------------------
Unique Record Keepers and Plan Administrators for existing DC              2,378              50           1,189
 Plans \a\......................................................
Professional Employer Organization \b\..........................             907              25             227
Chambers of Commerce \c\........................................           4,000               5             200
Large Broker-Dealers \d\........................................             173               5               9
Registered Investment Adviser Firms \d\.........................          30,246               5           1,512
Direct Annuity Writers (Insurance Companies) \e\................             386              25              97
                                                                 -----------------------------------------------
    Total.......................................................          38,090               8           3,233
----------------------------------------------------------------------------------------------------------------
\a\ 2017 Form 5500 Schedule C Data.
\b\ National Association of Professional Employers, https://www.napeo.org/what-is-a-peo/about-the-peo-industry/industry-statistics.
\c\ Association of Chamber of Commerce Executives reports that there are 4,000 Chambers with at least 1 full-
  time staff person.
\d\ 2019 FINRA Industry Snapshot. FINRA reported 3,607 FINRA registered firms in 2018. There were 173 with 500
  or more registered representatives.
\e\ National Association of Insurance Commissioners.

1.4. Benefits
    The SECURE Act requirement that pooled plan providers first 
register with the Department before beginning operations alerts 
regulators to the presence and intent of new entities. Registering 
allows potential pooled plan providers access to this newly created 
market. These registrations would require contact information, links to 
any websites containing marketing information for any pooled employer 
plan(s) established by the provider, the date operations are expected 
to commence, and a description of the provider's services and 
affiliates. These registrations will be publicly available and will 
provide a complete list of registered pooled plan providers. In 
addition, the supplemental filing requirement ensures that providers 
update their initial filing to report material changes relevant to the 
pooled plan provider's and participating employers' fiduciary duties 
(including, for example, inception of bankruptcy and litigation, 
criminal, or regulatory enforcement actions against the pooled plan 
provider). This will help provide transparency regarding the provider's 
management and business practices, allowing employers to better survey 
the market when choosing a pooled plan provider or deciding whether to 
continue to rely on an existing provider and the Department and 
Treasury Department to carry out their statutory oversight duties.
    In the Department's view, the statutory purpose of the registration 
requirement is to provide the Department with sufficient information 
regarding entities acting as pooled plan providers to engage in 
effective monitoring and oversight of this new type of ERISA retirement 
plan. As discussed above, the potential for inadequate employer 
oversight of the activities of a pooled employer plan and its plan 
fiduciaries and other service providers may be greater than for other 
plans sponsored by an employer because the nature of the plan involves 
participating employers passing along more responsibility to the pooled 
plan provider than they do in other plan arrangements. The proposed 
information collection, which has been kept limited to minimize burden, 
will enable the Department to fulfill its oversight responsibilities. 
Links to any websites containing marketing information for any pooled 
employer plan(s) established by the provider, the date operations are 
expected to commence, a description of the provider's services and 
affiliates, and material changes relevant to the pooled plan provider's 
fiduciary duties (including, for example, bankruptcy, litigation, and 
criminal or regulatory enforcement actions) all serve to help with 
monitoring and oversight.
    As stated above, the SECURE Act amended ERISA to remove possible 
barriers to the broader use of multiple employer plans. This objective 
was accomplished primarily by allowing multiple unrelated employers to 
participate in an open MEP called a pooled employer plan that does not 
require commonality among participating employers or a genuine 
organizational relationship unrelated to participation in the plan. By 
allowing most of the administrative and fiduciary responsibilities of 
sponsoring a retirement plan to be transferred to pooled plan 
providers, pooled employer plans provide employers with an option to 
provide a workplace retirement plan to their employees with reduced 
burdens and costs compared to sponsoring their own separate single 
employer retirement plan. Consequently, more plan formation and broader 
availability of workplace retirement plans should occur, especially 
among small employers.
    The Department is uncertain of the number of pooled employer plans 
that could be created based on the proposed rule, the number of 
employers that will participate in such plans, and the number of 
participants and beneficiaries that will be covered by them. The 
Department is confident, however, that some pooled employer plans will 
come into existence.
    It is possible that each pooled plan provider that registers will 
offer at least one new pooled employer plan and larger pooled plan 
providers may offer more than one new pooled employer plan. As is the 
case with multiple employer plans generally, some pooled employer plans 
may be large or very large in terms of participating employers, others 
medium in size, and some may even be small, although small pooled 
employer plans would seem to lack the attraction and efficiency of the 
economies of scale that could exist for larger pooled employer plans.
    The effects on coverage are somewhat uncertain because of the 
possibility of at least some zero-sum gain. Some new pooled employer 
plans will attract participating employers that currently do not offer 
retirement savings opportunities to their employees. The result in this 
situation would be a net coverage increase in this country and 
retirement security would be improved to some extent for the employees 
of these participating employers.\21\ At the

[[Page 54298]]

same time, however, the Department expects that some existing 
retirement plans, most likely those of small single employer plan 
sponsors, could terminate or otherwise cease to operate in their 
current form and merge into pooled employer plans. A dominant influence 
in this direction would be the administrative cost savings and other 
operational efficiencies that come with economies of scale. The 
Department has repeatedly acknowledged the potential benefits that 
could inure to small employers and their employees if they join 
together in a multiple employer plans and similar cooperative 
arrangements.\22\ For different reasons, though, it also is possible 
that some existing multiple employer plans, such as those structured 
under 29 CFR 2510.3-55 (Association Retirement Plans or ``ARPs''), 
could convert to pooled employers plans.\23\ Conversions of this type 
might occur, for example, if an ARP were to conclude that restrictions 
under section 3(5) of ERISA, such as the geographic limitations imposed 
pursuant to 29 CFR 2510.3-55(b)(2) or the substantial employment 
function test for bona fide professional employer organization 
arrangements in 2510.3-55(c)(1), were disadvantageous or inefficient 
relative to the conditions for being a pooled employer plan. The total 
number of defined contribution plans, therefore, could decrease as a 
result of these mergers and conversions; however, net coverage (i.e., 
the number of total defined contribution plan participants) could 
increase, because (1) participants in plans that merge or convert into 
pooled employer plans would continue to be covered under a retirement 
plan, and (2) some employers that do not currently provide their 
employees with retirement plan access would join pooled employer plans 
and their employees would count as newly-covered participants.
---------------------------------------------------------------------------

    \21\ Workplace retirement plans often provide a more effective 
way for employees to save for retirement than saving in their own 
IRAs. Compared with saving on their own in IRAs, workplace 
retirement plans provide employees with: (1) Higher contribution 
limits, (2) generally lower investment management fees as the size 
of plan assets increases, (3) a well-established uniform regulatory 
structure with important consumer protections, including fiduciary 
obligations, recordkeeping and disclosure requirements, legal 
accountability provisions, and spousal protections, (4) automatic 
enrollment, and (5) stronger protections from creditors. At the same 
time, workplace retirement plans provide employers with choice among 
plan features and the flexibility to tailor retirement plans that 
meet their business and employment needs. See 84 FR 37528.
    \22\ 84 FR 37508 (July 31, 2019) (Definition of ``Employer'' 
Under Section 3(5) of ERISA-- Association Retirement Plans and Other 
Multiple-Employer Plans); see also 83 FR 28912 (June 21, 2018) 
(Definition of ''Employer'' Under Section 3(5) of ERISA--Association 
Health Plans).
    \23\ Section 101 of SECURE Act itself contemplates such 
conversions and provides a special rule for existing plans to elect 
pooled employer plan status (new section 3(43)(C)) of ERISA).
---------------------------------------------------------------------------

    Pooled employer plans generally would benefit from scale advantages 
that small businesses do not currently enjoy, and the Department 
expects that such plans will pass some of the attendant savings onto 
participating employers and participants. Large scale may create two 
distinct economic advantages for pooled employer plans. First, as scale 
increases, marginal costs for pooled employer plans would diminish and 
pooled plan providers would spread fixed costs over a larger pool of 
member employers and employee participants, creating direct economic 
efficiencies. Second, asset managers commonly offer proportionately 
lower prices, relative to assets invested, to larger investors, under 
so-called tiered pricing practices resulting in decreased expense 
ratios based on the aggregate amount of money invested by a single 
pooled employer plan.
    For example, larger plans tend to have lower fees overall.\24\ 
Generally, small plans with 10 participants are paying approximately 50 
basis points more than plans with 1,000 participants.\25\ Small plans 
with 10 participants are paying about 90 basis points more than large 
plans with 50,000 participants. Grouping small employers together into 
a pooled employer plan could facilitate savings through administrative 
efficiencies and sometimes through price negotiation (market power). 
The degree of potential savings may be different for different types of 
administrative functions, e.g., scale efficiencies can be very large 
with respect to asset management, and may be smaller, but still 
meaningful, with respect to functions such as marketing, distribution, 
asset management, recordkeeping, and transaction processing.
---------------------------------------------------------------------------

    \24\ 84 FR 37508, 37535.
    \25\ Deloitte Consulting and Investment Company Institute, 
Inside the Structure of Defined Contribution/401(k) Plan Fees, 2013: 
A Study Assessing the Mechanics of the ``All-in'' Fee (Aug. 2014). 
Deloitte Consulting LLP conducted a survey of 361 defined 
contribution plans for the Investment Company Institute. The study 
calculates an ``all in'' fee that is comparable across plans 
including both administrative and investment fees paid by the plan 
and the participant. Deloitte predicted these estimates by analyzing 
the survey results using a regression approach calculating basis 
points as a share of assets. See 84 FR 37508. 37535.
---------------------------------------------------------------------------

    Other potential benefits of the expansion of MEPs through the 
creation of pooled employer plans could include: (1) Increased economic 
efficiency as small businesses can more easily compete with larger 
companies in recruiting and retaining workers due to a competitive 
employee benefit package, (2) enhanced portability for employees that 
leave employment with an employer to work for another employer 
participating in the same pooled employer plan, and (3) higher quality 
data (more accurate and complete) reported to the Department on the 
Forms PR and 5500. The Department requests comments regarding such 
potential benefits.
1.5. Costs
    The costs most directly associated with this rule are those of 
preparing and submitting the registration statement. The PRA section of 
this document, below, discusses these costs in detail. The estimated 
cost is $688,000 in the first year and $72,400 in subsequent years.\26\ 
The perpetual time horizon annualized cost is $106,100 in 2016 dollars, 
using a seven percent discount percent rate, discounted from 2016. 
Other indirect costs may ensue, depending on the extent of pooled 
employer plan formation, as well as the extent of conversions, mergers, 
and contractions among existing plans. The extent of these actions is 
unknown at this time; in other words, such additional costs are highly 
uncertain. With respect to any new pooled employer plan, these indirect 
costs would relate to pooled plan provider complying with the 
requirements of the SECURE Act that are not codified by this proposed 
regulation.
---------------------------------------------------------------------------

    \26\ The total ten-year cost is $1,215,000 with a three percent 
discount rate and $1,084,000 with a seven percent discount rate. The 
annualized ten-year cost is $142,000 using a three percent discount 
rate, and $154,000 using a seven percent discount rate.
---------------------------------------------------------------------------

1.6. Transfers
    Several potential transfers could occur as a result of this 
proposed rule. To the extent the formation of pooled employer plans 
leads employers that previously sponsored a retirement plans to 
terminate or freeze these plans, or leave another group plan like an 
ARP, and join a pooled employer plan, there may be a transfer if the 
pooled employer plan utilizes different service providers and asset 
types than the terminated plan. A similar transfer might occur in cases 
where employers who previously did not offer their employees a 
retirement plan join a pooled employer plan. Employees of these 
employers may have been saving for retirement previously in different 
ways, such as through an IRA, which would have different service 
providers. Service providers that specialize in providing services to 
pooled employer plans or are affiliated with a pooled plan provider 
might benefit at the expense of other providers who specialize in 
providing services to small plans or IRAs. Those different service 
providers would

[[Page 54299]]

experience gains or losses of income or market share.
    The rule could also result in asset transfers if pooled plan 
providers invest in different types of assets than plans that merge or 
convert to pooled employer plans. For example, small plans tend to rely 
more on mutual funds, while larger plans have greater access to other 
types of investment vehicles such as bank common collective trusts and 
insurance company pooled separate accounts, which allow for 
specialization and plan specific fees. This movement of assets could 
see profits move from mutual funds to other types of investment 
managers.
    Finally, the Code generally gives tax advantages to certain 
retirement savings over most other forms of savings.\27\ Consequently, 
all else being equal, workers who are saving money in tax qualified 
retirement savings vehicles generally can enjoy higher lifetime 
consumption and wealth than those who does not. The magnitude of the 
relative advantage generally depends on the worker's tax bracket, the 
amount contributed to the plan, the timing of contributions and 
withdrawals, and the investment performance of the assets in the 
account. Workers that do not contribute to a qualified retirement 
savings vehicle due to lack of access to a workplace retirement plan do 
not reap this relative advantage. This rule would likely increase the 
number of American workers with access to tax-qualified workplace 
retirement plans, which would spread this financial advantage to some 
people who are not currently receiving it. If access to retirement 
plans and savings increase as a result of this rule, a transfer will 
occur flowing from all taxpayers to those individuals receiving tax 
preferences as a result of new and increased retirement savings.
---------------------------------------------------------------------------

    \27\ Employer contributions to qualified pension plans and, 
generally, employee contributions made at the election of the 
employee through salary reduction are not taxed until distributed to 
the employee, and income earned on those amounts is not taxed until 
distributed. The tax expenditure for ``net exclusion of pension 
contributions and earnings'' is computed as the income taxes forgone 
on current tax-excluded pension contributions and earnings less the 
income taxes paid on current pension distributions.
---------------------------------------------------------------------------

    As is evident from the foregoing, the exact magnitude of the 
potential transfers is uncertain at this stage, as is the precise 
identities of the transferors and transferees. Much depends on the 
number of pooled employer plans that eventually come into existence, 
the extent of plan consolidation, the number of employers that begin 
participating anew in pooled employer plans and the savings habits of 
the employees of these employers (who might have heretofore been saving 
through an IRA). And a major influence on each of these factors will 
be, among other things, the nature, extent and timing of the regulatory 
intervention needed to implement the SECURE Act, as well as the general 
state of the economy. The Department specifically solicits comments and 
data on the potential magnitude of these transfers and the associated 
costs and benefits.
1.7. Uncertainty
    While the Department has identified types of service providers that 
it believes will be well positioned to act as pooled plan providers, it 
is unclear how many will choose to enter the market and whether they 
will do so in the first year of enactment or in later years. The 
Department has based its assumptions on discussions with stakeholders 
and articles on emerging markets. The Department invites comments on 
which and how many entities are likely to register as pooled plan 
providers.
    Section 101 of the SECURE Act requires pooled plan provides to 
register with the Department and provide such other information as the 
Secretary may require before beginning operations as a pooled plan 
provider. The Department seeks to include information that would prove 
useful, while minimizing costs. The Department requests comments on 
whether (1) any required information does not satisfy this condition or 
(2) it should require other information to be included in the 
registration whose benefits would outweigh any administrative burden.
1.8. Alternatives
    Section 101 of the SECURE Act requires pooled plan providers to 
register with the Secretary and provide such other information as the 
Secretary may require, before beginning operations as a pooled plan 
provider. The Department considered several alternative forms of 
information to be included that are discussed below.
    The Department could have required fewer data elements, such as 
contact information only, including address and email. While slightly 
less burdensome than the proposed requirements, requiring fewer data 
elements would provide substantially less information to the 
Department, which would impede its ability to fulfill its critical 
oversight role of protecting participants and plan assets. Employers 
also would receive less information to survey the market when choosing 
a pooled plan provider or deciding whether to continue to rely on an 
existing provider.
    The Department considered requiring pooled plan providers to file a 
registration for each pooled employer plan. This would have required 
pooled plan providers to file multiple similar filings. The Department 
did not choose this option, because it would have required pooled 
service providers to make multiple filings while providing minimal 
additional benefits.
    The Department also considered not requiring pooled service 
providers to make supplemental filings. While this option would have 
been less burdensome than the chosen option, it would have provided 
less information to the Department and interested employers. Requiring 
pooled service providers to report updated information to the 
Department can provide key information the Department needs to fulfill 
its oversight role. Therefore, the Department determined that the 
benefits of requiring supplemental filings justified any additional 
cost that pooled plan providers would incur to furnish the updated 
information.
2. Paperwork Reduction Act
    As part of its continuing effort to reduce paperwork and respondent 
burden, the Department conducts a preclearance consultation program to 
allow the general public and federal agencies to comment on proposed 
and continuing collections of information in accordance with the 
PRA.\28\ This helps to ensure that the public understands the 
Department's collection instructions, respondents can provide the 
requested data in the desired format, reporting burden (time and 
financial resources) is minimized, collection instruments are clearly 
understood, and the Department can properly assess the impact of 
collection requirements on respondents.
---------------------------------------------------------------------------

    \28\ 44 U.S.C. 3506(c)(2)(A) (1995).
---------------------------------------------------------------------------

    Currently, the Department is soliciting comments concerning the 
proposed information collection request (ICR) included in the 
registration requirements for pooled plan providers. To obtain a copy 
of the ICR, contact the PRA addressee shown below or go to https://www.RegInfo.gov.
    The Department has submitted a copy of the proposed rule to the 
Office of Management and Budget (OMB) in accordance with 44 
U.S.C.3507(d) for review of its information collections. The Department 
and OMB are particularly interested in comments that address the 
following:
     Evaluate whether the collection of information is 
necessary for the functions of the agency, including

[[Page 54300]]

whether the information will have practical utility;
     Evaluate the accuracy of the agency's estimate of the 
burden of the 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 
electronically delivered responses).
    Comments should be sent to the Office of Information and Regulatory 
Affairs, Office of Management and Budget, Room 10235, New Executive 
Office Building, Washington, DC 20503 and marked ``Attention: Desk 
Officer for the Employee Benefits Security Administration.'' Comments 
can also be submitted by fax at (202) 395-5806 (this is not a toll-free 
number), or by email at [email protected]. OMB requests that 
comments be received within 30 days of publication of the proposed rule 
to ensure their consideration.
    PRA Addressee: Address requests for copies of the ICR to G. 
Christopher Cosby, Office of Policy and Research, Employee Benefits 
Security Administration, U.S. Department of Labor, 200 Constitution 
Avenue NW, Room N-5718, Washington, DC 20210. The PRA Addressee may be 
reached by telephone at (202) 693-8410 or by fax at (202) 219-5333. 
(These are not toll-free numbers.) ICRs also are available at https://www.RegInfo.gov (https://www.reginfo.gov/public/do/PRAMain).
    The SECURE Act requires a person to register as a pooled plan 
provider with the Secretary, and provide other information the 
Secretary may require, before beginning operations. This information 
collection contains the requirements to register with the Secretary 
under section 3(44) of the Act. The information collection will utilize 
the EFAST 2 electronic filing system that pooled plan providers will 
use to file the Form 5500 required to be filed on behalf of the pooled 
employer plan the provider operates. The proposed Form PR and 
Instructions that appear in Appendix A are included as part of the 
information collection request.
    The Department has designed a two-part approach for this 
requirement. The first consists of a simple registration of contact 
information, links to marketing websites, and a description of services 
and the role of any affiliates. Pooled plan providers must 
electronically register with the Department at least 30 days, but not 
more than 90 days, before beginning operations. The information 
included should be collected by the pooled plan provider during its 
normal course of business, so collection should not require additional 
effort by the administrator. Therefore, the Department estimates that 
compiling and submitting the initial registration information will take 
about 45 minutes and impose no additional costs on the administrator. 
To limit costs, a pooled plan provider needs to file only one 
registration regardless of the number of pooled employer plans it 
operates, provided that a supplemental statement is filed identifying 
each pooled employer plan before the initiation of operations of the 
plan as a pooled employer plan. Assuming roughly 3,200 pooled plan 
providers, the Department estimates a burden of 2,425 hours, with an 
equivalent cost of $402,000, in the first year.\29\
---------------------------------------------------------------------------

    \29\ 3,223 pooled plan providers * 0.75 hours = 2,425 hours. 
2,425 hours * $165.63 = $401,653. Labor rates are EBSA estimates, 
found at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/rules-and-regulations/technical-appendices/labor-cost-inputs-used-in-ebsa-opr-ria-and-pra-burden-calculations-june-2019.pdf.
---------------------------------------------------------------------------

    If the pooled plan provider does not begin operating any new pooled 
employer plans, does not change its use of affiliates or other related 
parties to provide services or its contact information, or does not 
experience any material changes in condition set forth in the proposal, 
it may go for a period of years without needing to supplement its 
registration. The Department anticipates that this will be the case 
with many pooled plan providers.
    The supplemental filing requirement is similar to, although more 
limited than, filers' obligations with respect to the Form M-1, which 
requires entities to submit additional filings to document material 
changes. Approximately seven percent of entities filing a Form M-1 in 
2017 submitted an additional filing after undergoing a material change. 
Assuming pooled plan providers will behave in a similar manner, the 
Department expects roughly 230 pooled plan providers to submit 
supplemental filings documenting material changes annually, including 
in the first year.
    The supplemental filing amends the original registration to include 
employer identification numbers (EINs) and contact information for 
pooled employer plans that begin operations, cease operations, or 
experience material changes relevant to the pooled plan provider's 
fiduciary duties (including, for example, bankruptcy, litigation, and 
criminal or regulatory enforcement actions). Accordingly, the 
Department estimates the supplemental filing would take 30 minutes for 
pooled plan providers to submit. The Department does not believe, 
however, that the pooled plan provider would incur any additional costs 
beyond the labor costs necessary to collect and submit this 
information. The Department estimates that there will be 3,460 filings 
under the second part of this requirement in the first year, imposing a 
burden of 1,730 hours, with an equivalent cost of $287,000.\30\
---------------------------------------------------------------------------

    \30\ 3,460 pooled plan providers * 0.50 hour = 1,730 hours. 
1,730 hours * $165.63 = $286,540. Labor rates are EBSA estimates, 
found at https://www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/rules-and-regulations/technical-appendices/labor-cost-inputs-used-in-ebsa-opr-ria-and-pra-burden-calculations-june-2019.pdf.
---------------------------------------------------------------------------

    In subsequent years, the Department believes that the percentage of 
pooled plan providers reporting beginning or ceasing operations of 
pooled employer plans will roughly parallel the experience of Form M-1 
filers. Approximately 14 percent of Form M-1 filers indicated they 
began operations in 2017, while six percent indicated they ceased 
operations.\31\ Assuming pooled plan providers behave in a similar 
manner, the Department expects an additional 650 registrations related 
to beginning or ceasing operations annually in subsequent years.\32\ 
These filings require an hour burden of 324 hours with an equivalent 
cost of nearly $54,000 in subsequent years.
---------------------------------------------------------------------------

    \31\ Pension plans face additional burdens in terminating, and 
so using welfare plans termination rates as a proxy may overstate 
the number of incidents. The Department welcomes comments addressing 
this assumption.
    \32\ 3,233 * 0.14 = 453 pooled plan providers report pooled 
employer plans beginning operation, 453 pooled plan providers * 0.50 
hour = 227 hours. 227 hours * $165.63 = $37,598 3,233 * 0.06 = 453 
pooled plan providers report pooled employer plans ending operation, 
194 pooled plan providers * 0.50 hour = 977 hours. 97 hours * 
$165.63 = $16,060.
---------------------------------------------------------------------------

    The estimated total burden of this information collection is 4,155 
hours, with an equivalent cost of $688,000, in the first year and 437 
hours, with an equivalent cost of $72,400, in subsequent years.\33\
---------------------------------------------------------------------------

    \33\ 873 filings * 0.5 hours = 437 hours. The 873 filings in 
subsequent years are 453 pooled plan providers reporting pooled 
employer plans beginning operations, 194 pooled plan providers 
reporting pooled employer plans ending operations, and 226 pooled 
plan providers filing other changes.
---------------------------------------------------------------------------

    The Department expects a large number of pooled plan providers to 
file the first part of registrations in the initial year, and 
significantly fewer to file in subsequent years as the market 
stabilizes. Incidents of filing updated

[[Page 54301]]

and amended registration statements are expected to increase after the 
first year, as pooled employer plans enter and exit the market, change 
service providers, and change pooled employer plan offerings.
    A summary of paperwork burden estimates follows:
    Type of Review: New collection.
    Agency: Employee Benefits Security Administration, U.S. Department 
of Labor.
    Title: Registration requirements to serve as a pooled plan provider 
to pooled employer plans.
    OMB Control Number: 1210-NEW.
    Affected Public: Businesses or other for-profits.
    Estimated Number of Respondents: 1,660 3-year average (3,233 first 
year, 873 subsequent years).
    Estimated Number of Annual Responses: 2,813 3-year average (6,693 
first year, 873 subsequent years).
    Frequency of Response: Occasionally.
    Estimated Total Annual Burden Hours: 1,676 3-year average (4,155 
first year, 437 subsequent years).
    Estimated Total Annual Burden Cost: 0.
3. Regulatory Flexibility Act
    The Regulatory Flexibility Act (RFA) \34\ imposes certain 
requirements with respect to federal rules that are (1) subject to the 
notice and comment requirements of section 553(b) of the Administrative 
Procedure Act \35\ and (2) likely to have a significant economic impact 
on a substantial number of small entities. Unless an agency determines 
that a proposal is not likely to have a significant economic impact on 
a substantial number of small entities, section 603 of the RFA requires 
the agency to present an initial regulatory flexibility analysis of the 
proposed rule. The Department has determined that this proposed rule, 
which would require prospective pooled plan providers to register with 
the Department prior to beginning operations, is not likely to have a 
significant economic impact on a substantial number of small entities. 
Therefore, the Department certifies that the proposed rule will not 
have a significant economic impact on a substantial number of small 
entities. The Department estimates that only about eight percent of the 
potential market will decide to be a pooled plan provider and be 
subject to the rule. Each of these entities would incur an estimated 
cost of $124 to register and $83 to update the registration if needed. 
Below is justification for this determination.
---------------------------------------------------------------------------

    \34\ 5 U.S.C. 601 et seq. (1980).
    \35\ 5 U.S.C. 551 et seq. (1946).
---------------------------------------------------------------------------

3.1. Need for and Objectives of the Rule
    Section 101 of the SECURE Act requires pooled plan providers to 
register with the Department, the Treasury Department, and the IRS. As 
noted above, the Treasury Department and the IRS have indicated that 
filing the registration statement with the Department will also satisfy 
the Code's registration requirement. The required information under the 
proposal would allow regulators to identify and monitor pooled plan 
providers. While some of the required information may be found in the 
Form 5500, which pooled plan providers will also be required to file on 
behalf of each participating employer plan they operate, this reporting 
is not available for more than 18 months after the pooled plan 
providers begin operating, and would not necessarily include some 
important information regarding the pooled plan providers themselves, 
such as bankruptcy filings, or the commencement of any criminal, civil, 
or administrative proceedings in any court or administrative tribunal 
by the federal or state government or other regulatory authority 
against the pooled plan provider related to the provisions of services 
to, operation of, or investments of, any employee benefit plan. 
Requiring pooled plan providers to register gives both the agencies and 
the public, including participating employers, more immediate access to 
the information for monitoring purposes, and enables the agencies to 
monitor how this new market develops and assess whether further 
guidance is needed.
3.2. Affected Small Entities
    The Department has identified certain existing entities that it 
believes would be most likely to serve as pooled plan providers. For 
example, recordkeepers that currently administer retirement plans are 
well positioned to serve as pooled plan providers. Similarly, many PEOs 
have served as plan administrators and would likely have little trouble 
taking on the role of pooled plan provider. Further, many insurers have 
expressed interest in serving as pooled plan providers. While 
retirement plan advisors such as broker-dealers and registered 
investment advisors are also plausible candidates, the Department 
believes that many would be reluctant to assume the named fiduciary and 
plan administrator roles. Entities such as registered investment 
advisors may likely be more comfortable serving as section 3(38) 
investment managers for the pooled plan providers.
    Given these assumptions, the Department estimates that roughly 
3,200 unique entities will initially register to serve as pooled plan 
providers. Recordkeepers and plan administrators of existing defined 
contribution pension plans are most likely to enter the market, 
followed by PEOs, chambers of commerce, and plan advisors.
    While the Department does not have complete information on which of 
these entities meet the Small Business Administration's definition of a 
small entity, many of these entities likely are small. The Department 
estimates that about half of current recordkeepers and plan 
administrators currently serving DC plans would register to become 
pooled plan providers. Other types of providers will likely comprise a 
smaller share of entities that register. Overall, the Department 
estimates that about eight percent of the universe of entities the 
Department has identified as well-suited to serve as pooled plan 
providers are likely to register. The table below includes both large 
and small entities. The Department cannot estimate with specificity the 
distribution by size of the providers that will choose to become pooled 
plan providers although most of the providers in these service 
categories meet the Small Business Administration definition of small 
entities, however if the percentages in the footnote are applied to the 
number of affected entities in the table below, about 2,600 businesses 
could be small businesses.\36\
---------------------------------------------------------------------------

    \36\ Some possible affected industries by NAICS code are as 
follows: 524292 third-party administration, more than 90 percent 
small business; 524113 underwriting annuities and life insurance, 
more than 70 percent small business, 523999 financial investment 
services, more than 95 percent small businesses; 523999 brokerage, 
financial investment services, more than 95 percent small business; 
561330 professional employer organization, more than 90 percent 
small business.

                                         Estimated Pooled Plan Provider
----------------------------------------------------------------------------------------------------------------
                                                                                  Expected share     Estimated
                                                                     Universe           (%)           number
----------------------------------------------------------------------------------------------------------------
Unique Record Keepers and Plan Administrators for existing DC              2,378             50%            1189
 Plans \a\......................................................

[[Page 54302]]

 
Professional Employer Organization \b\..........................             907              25             227
Chambers of Commerce \c\........................................           4,000               5             200
Large Broker-Dealers \d\........................................             173               5               9
Registered Investment Advisor Firms \d\.........................          30,246               5            1512
Direct Annuity Writers (Insurance Companies) \e\................             386              25              97
                                                                 -----------------------------------------------
    Total.......................................................          38,090              8%           3,233
----------------------------------------------------------------------------------------------------------------
\a\ 2017 Form 5500 Schedule C Data.
\b\ National Association of Professional Employers, https://www.napeo.org/what-is-a-peo/about-the-peo-industry/industry-statistics.
\c\ Association of Chamber of Commerce Executives reports that there are 4,000 Chambers with at least 1 full-
  time staff person.
\d\ FINRA Industry Snapshot. FINRA reported 3,607 FINRA registered firms in 2018. There were 173 with 500 or
  more registered representatives.
\e\ National Association of Insurance Commissioners.

3.3. Impact of the Rule
    The Department estimates that it would take the average pooled plan 
provider with a labor rate of $165.63 only 45 minutes to register, at 
an expense of $124.23, because the information necessary is readily 
available through the normal course of business.\37\ Pooled plan 
providers submit the filing only when data elements change, the 
administrator begins or ceases operations for any pooled employer plan, 
or the pooled plan provider undergoes a material change. The 
supplemental filing will require an estimated 30 minutes to complete, 
at an expense of $82.82. As with the initial registration, the required 
information for the supplemental filing is readily available. The cost 
to file both a registration and a supplemental filing in a single year 
would be $207.16, which would be less than one percent of revenues if a 
business had more than $20,700 in revenues. The Department lacks 
complete data to determine the number of firms that do not meet this 
revenue threshold. Available data suggests that 15 percent of possibly 
affected firms have revenues less than $100,000.\38\
---------------------------------------------------------------------------

    \37\ To register: 0.75 hours per pooled plan provider; 0.75 
hours * $165.63 = $124.23. To update a registration: 0.50 hours * 
$165.63 = $82.82. The total labor rate for a financial manager is 
used as a proxy for the labor rate. Labor rates are EBSA estimates 
found at www.dol.gov/sites/dolgov/files/EBSA/laws-and-regulations/rules-and-regulations/technical-appendices/labor-cost-inputs-used-in-ebsa-opr-ria-and-pra-burden-calculations-june-2019.pdf.
    \38\ Data set supplied by the Small Business Administration 
containing data on the number of firms and revenue by NAICS codes. 
Estimates used NAICS codes 524292, 56133, 523120, 52393, 523130, and 
524113.
---------------------------------------------------------------------------

    To further show how small a $207 burden is, note that a one-person 
firm consisting of an individual with a labor rate of $165.63 would 
need to only work 125 hours to have revenue of $20,700. That same 
individual working 2,000 hours, a standard work year, would produce 
revenue of $331,260 resulting in $207.16 being significantly less than 
once percent of revenue.
3.4. Duplicate, Overlapping, or Relevant Federal Rules
    The proposed rule would not conflict with any relevant federal 
rules. Section 101 of the SECURE Act requires pooled plan providers to 
register both with the Department and with the Treasury Department and 
the IRS; the proposed Form PR would satisfy the requirements under both 
Title I of ERISA and the Code. The statute expressly provides a 
separate authorization for the Departments to require additional 
information.
4. Unfunded Mandates Reform Act
    Title II of the Unfunded Mandates Reform Act of 1995 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.\39\ For 
purposes of the Unfunded Mandates Reform Act, as well as Executive 
Order 12875, this proposal does not include any federal mandates that 
the Department expects would result in such expenditures by state, 
local, and tribal governments, or the private sector.\40\ This rule 
simply requires prospective pooled plan providers to register with the 
Department.
---------------------------------------------------------------------------

    \39\ 2 U.S.C. 501 et seq. (1995).
    \40\ Enhancing the Intergovernmental Partnership, 58 FR 58093 
(Oct. 28, 1993).
---------------------------------------------------------------------------

5. Federalism Statement
    Executive Order 13132 outlines fundamental principles of 
federalism, and requires that federal agencies adhere to specific 
criteria when formulating and implementing policies that have 
``substantial direct effects'' on the states, the relationship between 
the national government and states, or on the distribution of power and 
responsibilities among the various levels of government.\41\ Federal 
agencies promulgating regulations that have federalism implications 
must first consult with state and local officials, then describe in the 
preamble to the final rule the extent of their consultation and the 
nature of the officials' concerns.
---------------------------------------------------------------------------

    \41\ Federalism, supra note 7.
---------------------------------------------------------------------------

    In the Department's view, these proposed regulations would not have 
federalism implications because they would not have direct effects on 
the states, on the relationship between the national government and the 
states, nor on the distribution of power and responsibilities among 
various levels of government. This proposed rule simply requires 
private companies that intend to offer pooled employer plans to 
register with the Department.
    The Department welcomes input from states regarding this 
assessment.

List of Subjects in 29 CFR Part 2510

    Employee benefit plans, Pensions.

    For the reasons stated in the preamble, the Department of Labor 
proposes to amend 29 CFR part 2510 as follows:

PART 2510--DEFINITIONS OF TERMS USED IN SUBCHAPTERS C, D, E, F, G, 
AND L OF THIS CHAPTER

0
1. The authority citation for part 2510 is revised to read as follows:

    Authority: 29 U.S.C. 1002(1), 1002(2), 1002(3), 1002(5), 
1002(16), 1002(21), 1002(37), 1002(38), 1002(40), 1002(42), 
1002(43), 1002(44), 1031, and 1135; Secretary of Labor's Order No. 
1-2011, 77 FR 1088 (Jan. 9, 2012); Sec. 2510.3-101 and 2510.3-102 
also issued under sec. 102 of Reorganization

[[Page 54303]]

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, Public Law 105-72, 111 Stat. 1457 (1997).

0
2. Add Sec.  2510.3-44 to read as follows:


Sec.  2510.3-44  Registration requirement to serve as a pooled plan 
provider to pooled employer plans.

    (a) General. Section 3(44) of the Act sets forth the criteria that 
a person must meet in order to be a pooled plan provider for pooled 
employer plans under section 3(43) of the Act.
    (b) Registration requirement. Subparagraph (A)(ii) of section 3(44) 
requires the person to register as a pooled plan provider with the 
Department, and provide such other information as the Department may 
require, before beginning operations as a pooled plan provider. For 
this purpose, ``beginning operations as a pooled plan provider'' means 
publicly marketing services as a pooled plan provider or publicly 
offering a pooled employer plan. To meet the requirements to register 
with the Department under section 3(44) of the Act, a person intending 
to act as a pooled plan provider must:
    (1) No earlier than 90 days and no later than 30 days before 
beginning operations as a pooled plan provider, file with the 
Department the following information on a complete and accurate Form PR 
(Pooled Plan Provider Registration) in accordance with the form's 
instructions.
    (i) The legal business name and any trade name (doing business as) 
of such person.
    (ii) The business mailing address and phone number of such person.
    (iii) The employer identification number (EIN) assigned to such 
person by the Internal Revenue Service.
    (iv) The address of any public website or websites of the pooled 
plan provider or any affiliates to be used to market any such person as 
a pooled plan provider to the public or to provide public information 
on the pooled employer plans operated by the pooled plan provider.
    (v) Name, address, contact telephone number and email address for 
the primary compliance officer of the pooled plan provider.
    (vi) The agent for service of legal process for the pooled plan 
provider, and the address at which process may be served on such agent, 
and in addition, a statement that service of legal process may be made 
upon the pooled plan provider.
    (vii) The approximate date when pooled plan operations are expected 
to commence.
    (viii) A description of the administrative, investment, and 
fiduciary services that will be offered or provided in connection with 
the pooled employer plans, including a description of the role of any 
affiliates in such services. For purposes of this paragraph (viii), the 
term ``affiliate'' includes all persons who are treated as a single 
employer with the person intending to be a pooled plan provider under 
section 414(b), (c), (m), or (o) of the Internal Revenue Code who will 
provide services to pooled employer plans sponsored by the pooled plan 
provider and any officer, director, partner, employee, or relative (as 
defined in section 3(15) of the Act) of such person; and any 
corporation or partnership of which such person is an officer, 
director, or partner.
    (ix) A statement disclosing any federal or state criminal 
conviction related to the provision of services to, operation of, or 
investments of, any employee benefit plan, against the pooled plan 
provider, or any officer, director, or employee of the pooled plan 
provider if the conviction, or related term of imprisonment served, 
provider is within ten years of the date of registration.
    (x) A statement disclosing any ongoing criminal, civil, or 
administrative proceedings related to the provisions of services to, 
operation of, or investments of any employee benefit plan, in any court 
or administrative tribunal by the federal or state government or other 
regulatory authority against the pooled plan provider, or any officer, 
director, or employee of the pooled plan provider.
    (2) No later than the initiation of operations of a plan as a 
pooled employer plan, file with the Department a supplemental report 
using the Form PR containing the name and EIN for the pooled employer 
plan, and the name, address, and EIN for the trustee for the plan.
    (3) Within 30 days of occurrence of the following reportable 
events, file with the Department a supplemental report using the Form 
PR:
    (i) Any change in the information reported pursuant to subparagraph 
(b)(1) or (b)(2) of this section.
    (ii) Any significant change in corporate or business structure of 
the pooled plan provider, e.g., merger, acquisition, or initiation of 
bankruptcy, receivership, or other insolvency proceeding for the pooled 
plan provider or an affiliate, or ceasing all operations as a pooled 
plan provider.
    (iii) Receipt of written notice of the initiation of any 
administrative or enforcement action related to the provision of 
services to, operation of, or investments of any pooled employer plan 
or other employee benefit plan, in any court or administrative tribunal 
by any federal or state governmental agency or other regulatory 
authority against the pooled plan provider or any officer, director, or 
employee of the pooled plan provider.
    (iv) Receipt of written notice of a finding of fraud or dishonesty 
by a federal or state court or federal or state governmental agency 
related to the provision of services to, operation of, or investments 
of any pooled employer plan or other employee benefit plan against the 
pooled plan provider or any officer, director, or employee of the 
pooled plan provider.
    (v) Receipt of written notice of the filing of any federal or state 
criminal charges related to the provision of services to, operation of, 
or investments of any pooled employer plan or other employee benefit 
plan against the pooled plan provider or any officer, director, or 
employee of the pooled plan provider.
    (4) Only one registration must be filed for each person intending 
to act as a pooled plan provider, regardless of the number of pooled 
employer plans it operates. A pooled plan provider must file updates 
for each pooled employer plan described in paragraph (b)(2) of this 
section, any change of previously reported information, and any change 
in circumstances listed in paragraph (b)(3) of this section, but may 
file a single statement to report multiple changes, as long as the 
timing requirements are met with respect to each reportable change.
    (5) If a pooled plan provider has terminated and ceased operating 
all pooled employer plans, the pooled plan provider must file a final 
supplemental filing in accordance with instructions for the Form PR.
    (6) For purposes of this section, a pooled employer plan is treated 
as beginning operations when it is considered covered by Title I of 
ERISA within the meaning of section 4 of ERISA, and a pooled employer 
plan is treated as terminated and ceased operating when a resolution 
has been adopted terminating the plan, all assets under the plan 
(including insurance/annuity contracts) have been distributed to the 
participants and beneficiaries or legally transferred to the control of 
another plan, and a final Form 5500 has been filed for the plan.
    (7) Registrations required under this section shall be filed with 
the Secretary electronically on the Form PR in accordance with the Form 
PR instructions published by the Department.


[[Page 54304]]


    Signed at Washington, DC, this 18th day of August 2020.
Jeanne Klinefelter Wilson,
Acting Assistant Secretary, Employee Benefits Security Administration, 
Department of Labor.
BILLING CODE 4510-29-P
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BILLING CODE 4510-29-C

Instructions for Form PR (Registration for Pooled Plan Provider)

About the Form PR

    The Form PR is used to report information for a person or entity 
that intends to serve as a pooled plan administrator to pooled employer 
plans within the meaning of sections 3(44) and 3(43) of the Employee 
Retirement Income Security Act of 1974 (ERISA), as amended, and 29 CFR 
2510. 3-44.
    You must file the Form PR electronically. You cannot file a paper 
Form PR by mail or other delivery service. Your Form PR will be 
initially screened electronically. For more information, see the 
instructions for Electronic Filing Requirement and the Form PR filing 
system at [insert correct web address/hyperlink].
    If you have any questions (such as whether you are required to file 
this report) or if you need any assistance in completing this report, 
please call the EBSA Form PR help desk at 202-693-XXXX.

Table of Contents

Section 1: Who Must File
    Registration
    Supplemental Filing
    Amended Filing
    Final Filing
Section 2: When To File
Section 3: Electronic Filing
    How To File
    Failure To File
    Signature and Date
Section 4: Line-by-Line Instructions
Paperwork Reduction Act Notice

Section 1: Who Must File

    Any person who wishes to serve as a pooled plan provider to one or 
more pooled employer plans must file Form PR (Registration Statement of 
Pooled Plan Provider) with the Department of Labor. See ERISA sections 
3(43) and 3(44) enacted by the Setting Every Community Up for 
Retirement Enhancement Act of 2019, Division O of the Further 
Consolidated Appropriations Act, 2020 (Pub. L. 116-94) (December 20, 
2019).
    Note. ``Person'' for these purposes includes corporations, 
partnerships, and sole proprietorships.
    Section 3(44) of ERISA establishes requirements for ``pooled plan 
providers,'' including a requirement that a person wishing to so act 
must register with the Department of Labor and the Department of the 
Treasury. The effective date for these provisions allows ``pooled 
employer plans'' to begin operating on January 1, 2021.
    Under section 3(2) of ERISA, a pooled employer plan is treated for 
purposes of ERISA as a single plan that is a multiple employer plan. A 
``pooled employer plan'' is defined in section 3(43) as a plan: (1) 
That is an individual account plan established or maintained for the 
purpose of providing benefits to the employees of two or more 
employers, (2) that is a qualified retirement plan or a plan funded 
entirely with individual retirement accounts (IRA plan), and (3) the 
terms of the plan must meet certain requirements set forth in the 
statute.\42\ Specifically, the terms of the plan must--
---------------------------------------------------------------------------

    \42\ The term ``pooled employer plan'' does not include a 
multiemployer plan or plan maintained by employers that have a 
common interest other than having adopted the plan. The term also 
does not include a plan established before the date the SECURE Act 
was enacted unless the plan administrator elects to have the plan 
treated as a pooled employer plan and the plan meets the ERISA 
requirements applicable to a pooled employer plan established on or 
after such date.
---------------------------------------------------------------------------

     designate a pooled plan provider and provide that the 
pooled plan provider is a named fiduciary of the plan;
     designate one or more trustees (other than an employer in 
the plan) to be responsible for collecting contributions to, and 
holding the assets of, the plan, and require the trustee(s) to 
implement written contribution collection procedures that are 
reasonable, diligent, and systematic;
     provide that each employer in the plan retains fiduciary 
responsibility for the selection and monitoring, in accordance with 
ERISA fiduciary requirements, of the person designated as the pooled 
plan provider and any other person who is also designated as a named 
fiduciary of the plan, and, to the extent not otherwise delegated to 
another fiduciary by the pooled plan provider (and subject to the ERISA 
rules relating to self-directed investments), the investment and 
management of the portion of the plan's assets attributable to the 
employees of that employer (or

[[Page 54308]]

beneficiaries of such employees) in the plan;
     provide that employers in the plan, and participants and 
beneficiaries, are not subject to unreasonable restrictions, fees, or 
penalties with regard to ceasing participation, receipt of 
distributions, or otherwise transferring assets of the plan in 
accordance with applicable rules for plan mergers and transfers;
     require the pooled plan provider to provide to employers 
in the plan any disclosures or other information that the Secretary of 
Labor may require, including any disclosures or other information to 
facilitate the selection or any monitoring of the pooled plan provider 
by employers in the plan, and require each employer in the plan to take 
any actions that the Secretary of Labor or pooled plan provider 
determines are necessary to administer the plan or to allow for the 
plan to meet the ERISA and Code requirements applicable to the plan, 
including providing any disclosures or other information that the 
Secretary of Labor may require or that the pooled plan provider 
otherwise determines are necessary to administer the plan or to allow 
the plan to meet such ERISA and Code requirements;, and
     provide that any disclosure or other information required 
to be provided to participating employers may be provided in electronic 
form and will be designed to ensure only reasonable costs are imposed 
on pooled plan providers and employers in the plan.
    The fidelity bonding requirements in ERISA section 412 apply to 
fiduciaries and other persons handling the assets of a pooled employer 
plan, but the maximum bond amount for each such plan official is 
$1,000,000 as compared to the $500,000 maximum that applies in the case 
of other ERISA-covered plans that do not hold employer securities. See 
29 CFR 2550.412-1, 29 CFR part 2580; see also Field Assistance Bulletin 
2008-04 (providing a general description of statutory and regulatory 
requirements for bonding).
    A ``pooled plan provider'' with respect to a pooled employer plan 
is defined in ERISA section 3(44) to mean a person that:
     Is designated by the terms of the plan as a named 
fiduciary under ERISA, as the plan administrator, and as the person 
responsible to perform all administrative duties (including conducting 
proper testing with respect to the plan and the employees of each 
employer in the plan) that are reasonably necessary to ensure that the 
plan meets the Code requirements for tax-favored treatment and the 
requirements of ERISA and to ensure that each employer in the plan 
takes actions as the Secretary or the pooled plan provider determines 
necessary for the plan to meet Code and ERISA requirements, including 
providing to the pooled plan provider any disclosures or other 
information that the Secretary may require or that the pooled plan 
provider otherwise determines are necessary to administer the plan or 
to allow the plan to meet Code and ERISA requirements;
     acknowledges in writing its status as a named fiduciary 
under ERISA and as the plan administrator;
     is responsible for ensuring that all persons who handle 
plan assets or are plan fiduciaries are bonded in accordance with ERISA 
requirements; and
     registers as a pooled plan provider.
    Filing a true, complete, and correct registration statement, 
including any required updates, satisfies the requirement under section 
3(44) of ERISA to register as a pooled plan provider with the 
Department of Labor. See section 3(44) of ERISA for other requirements.

Section 2: When To File

    You must file your initial registration statement no earlier than 
90 days and no later than 30 days before beginning operations as a 
pooled plan provider. See 29 CFR 2510.3-44(b)(1).
    For this purpose, ``beginning operations as a pooled plan 
provider'' means publicly marketing services as a pooled plan provider 
or offering a pooled employer plan. See 29 CFR 2510.3-44(b)(6).
    Before the initiation of operations of a plan as a pooled employer 
plan with respect to a particular plan, you must supplement your 
registration statement with the name and EIN for the pooled employer 
plan, and the name, address, and EIN for the trustee for the plan. If 
an entity's first operations as a pooled plan provider will be with 
respect to a particular plan, the supplemental information required 
regarding each plan may be combined with the entity's initial 
registration.
    You must also supplement your registration statement within 30 days 
of any changes to previously reported information or of the occurrence 
of the reportable events described below.
    See 29 CFR 2510.3-44(b)(3). You should amend your registration 
statement within 30 days of discovering an error on your statement, but 
no later than the date for filing a Form 5500 Annual Return/Report of 
Employee Benefit Plan (Form 5500), where identifying information about 
the pooled plan provider, any pooled employer plans it administrators, 
or any trustees for those plans would conflict with the information 
required on the Form 5500.

Section 3: Electronic Filing

    The Form PR must be filed electronically with the Department of 
Labor by going to [insert correct title/hyperlink]. Your entries must 
be in the proper format in order for the electronic system to process 
your filing. For example, if a question requires you to enter a 
numerical account number, you cannot enter a word.
    To reduce the possibility of correspondence and penalties:
     Complete all lines on the Form PR unless otherwise 
specified.
     Do not enter ``N/A'' or ``Not Applicable'' on the Form PR 
unless specifically permitted.
     ``Yes'' or ``No'' questions on the Form PR cannot be left 
blank, unless specifically permitted. Answer either ``Yes'' or ``No,'' 
but not both.
    Do not enter social security numbers in response to questions 
asking for an employer identification number (EIN). Because of privacy 
concerns, the inclusion of a social security number on the Form PR or 
on an attachment that is open to public inspection may result in the 
rejection of the filing.
    To correct errors and/or omissions on a previously filed Form PR, 
submit a completed Form PR indicating the filing is an amended report 
in Part I.

Failure To File

    You are not permitted to act as a pooled plan provider unless you 
electronically file and sign a registration statement in accordance 
with the Department's regulation at 29 CFR 2510.3-44 and these 
instructions. You may be liable for breaches of fiduciary duty under 
ERISA and other state and federal law violations, including for 
misrepresentation regarding status as a pooled plan provider. The 
failure to file an update would not automatically result in a 
conclusion that, by operation of law, the pooled employer plans 
administered by the pooled plan provider would no longer be single 
plans and instead, a group of individual plans that use the same 
arrangement for operating their plans.
    Identifying Information and EIN: You must use the same identifying 
information for the pooled plan provider on Form PR, including name and 
EIN, on the Form 5500 for each plan the pooled plan provider 
administers.

Signature and Date

    A person filing to satisfy the conditions of section 3(44) of ERISA 
and

[[Page 54309]]

29 CFR 2510.3-44 must sign this registration statement, indicating that 
the contents are true and correct to the best of the signer's 
knowledge. If the pooled plan provider does not electronically sign a 
filing, the filing status will indicate that there is an error with the 
filing. With respect to the initial registration, if it is unsigned, 
the filing will not constitute the required registration statement for 
such provider to operate a pooled employer plan.
    The pooled plan provider or, if the pooled plan provider is an 
entity, a person authorized to sign on behalf of the pooled plan 
provider must electronically sign the Form PR submitted to the 
electronic filing system.
    The Form PR must be filed electronically and signed. To obtain an 
electronic signature, go to [insert correct web address/hyperlink] and 
register as a signer. You will be provided with a UserID and PIN. Both 
the UserID and PIN are needed to sign the Form PR. The system will 
prevent the submission of any filing that does not include all required 
information. A completed filing will generate an online receipt. The 
pooled plan provider must keep a copy of the receipt as part of the 
plan's records as required by section 107 of ERISA.
    If you have questions about using or completing the Form PR, please 
contact the Form PR Help Desk at [insert telephone number].

Section 4: Line-by-Line Instructions

    Important: ``Yes/No'' questions must be marked ``Yes'' or ``No,'' 
but not both. ``N/A'' is not an acceptable response unless expressly 
permitted in the instructions to that line.
    Part I--Filing Type. Check the appropriate box to indicate filing 
type.
    Initial filing. This is the registration statement for a person 
that intends to serve as a pooled plan provider to pooled employer 
plans. Only one registration must be filed for each person intending to 
act as a pooled plan provider, regardless of the number of pooled 
employer plans it operates.
    Supplemental reportable event filing. This is to report any 
reportable event information additional to the initial or the most 
recent supplemental filing. This includes identifying each plan the 
pooled plan provider establishes and certain changes in the pooled plan 
provider's status.
    Check ``Supplemental Filing'' and on Line 6 check the box to 
identify whether you are reporting information about a new pooled 
employer plan, a change in information previously reported, e.g., a 
change in the pooled plan provider's address since the last filing or 
the identification of a new affiliate providing services to the pooled 
employer plans operated by the pooled plan provider, or other change in 
circumstances. If you are correcting a mistake in a previous filing of 
the Form PR, check the ``Amended'' filing box.
    Note. The information reported on the Form PR regarding the pooled 
plan provider and any affiliates providing services to the pooled 
employer plans operated by the pooled plan provider and on the Forms 
5500 filed by the pooled plan provider, as plan administrator on behalf 
of the pooled employer plans it operates, must match. A mismatch could 
result in Form 5500 correspondence.
    Amended filing. Check ``amended filing'' only if you are correcting 
information previously reported on a Form PR you filed; for example, 
you entered an incorrect name for an affiliate of the pooled plan 
provider.
    Final filing. Once an entity has terminated operations as a pooled 
plan provider, including having ceased operating all pooled employer 
plans, the pooled plan provider must file a final supplemental filing. 
For purposes of the Form PR, a pooled employer plan would be treated as 
terminated and having ceased operations for this purpose when a 
resolution has been adopted terminating the plan, all assets under the 
plan (including insurance/annuity contracts) have been distributed to 
the participants and beneficiaries or legally transferred to the 
control of another plan, and when a final Form 5500 Return/Report has 
been filed for the plan. The final filing would be due within 30 days 
of the filing of the last final Form 5500 for the last pooled employer 
plan the provider operates. A single combined filing may be used to 
report both that the last pooled employer plan operated by the provider 
has been terminated and ceased operating and as the final Form PR 
filing for the pooled plan provider.
    Caution: Each pooled employer plan operated by the pooled plan 
provider must have met the conditions for the filing of a final Form 
5500 and such return/report must have been filed for each pooled 
employer plan operated by the pooled plan provider before the pooled 
plan provider can submit a final filing. See Instructions for the Form 
5500.
    Part II--Registration Information.
    Make sure to use the same identifying information as you use for 
other state and federal registration and reporting requirements.
    Line 1a. Enter the legal name of the person (person includes both 
individuals and entities) registering as the pooled plan provider. If 
the person uses a ``trade'' or ``doing business as'' name, also enter 
that name (both the legal and trade (d/b/a) name).
    Line 1b. Enter a telephone number where participating employers 
will be able to reach the pooled plan provider. This does not preclude 
the pooled plan provider from also providing to participating employers 
a separate, dedicated telephone contact number for a particular pooled 
employer plan.
    Line 1c. If the pooled plan provider and/or an affiliate uses one 
or more public websites to market such person as a pooled plan provider 
to the public or to provide participating employers (regardless of 
whether there is a registration requirement for full access) with 
information about the pooled employer plans in which they participate, 
enter the address(es) of such website(s) here.
    Line 1d. Enter the business mailing address (include room, apt., 
suite No., and street; or P.O. Box, city or town, state, and ZIP code).
    Line 1e. You must enter the Employer Identification Number (EIN) 
the pooled plan provider obtained from the Internal Revenue Service 
(IRS). You must use the same EIN number as the pooled plan provider 
uses for other federal and state filings, including with the IRS and 
the U.S. Securities and Exchange Commission (SEC). You must also use 
this EIN in the plan administrator field for all Forms 5500 filed for 
the pooled employer plans administered by the pooled plan provider.
    Do not enter social security numbers in response to questions 
asking for an employer identification number (EIN). Because of privacy 
concerns, the inclusion of a social security number or any portion 
thereof on the Form PR may result in the rejection of the filing.
    Persons wishing to act as pooled plan providers that are without an 
EIN must apply for one as soon as possible. The EBSA does not issue 
EINs. To apply for an EIN from the IRS:
     Mail or fax Form SS-4, Application for Employer 
Identification Number, obtained at https://www.irs.gov/pub/irs-pdf/fss4.pdf.
     See https://www.irs.gov/forms-pubs/about-form-ss-4 for 
additional information. The EIN is issued immediately once the 
application information is validated. (The online application process 
is not yet available for corporations with addresses in foreign 
countries.)
    Lines 1f, 1g, and 1h. Enter the name, mailing address, telephone 
number, and email address for the primary

[[Page 54310]]

compliance officer of the pooled plan provider.
    Line 1i. Enter the full name of the agent for service of legal 
process and the address at which process may be served on the agent.
    Line 2. Enter the approximate date the pooled plan provider expects 
to begin operating pooled employer plan(s). (Use MM/DD/YYYY format.)
    Caution: The date entered here must be no earlier than 90 and no 
later than 30 days before the date of filing this registration 
statement.
    Line 3. For each plan service or investment product listed in Lines 
3a through 3f, indicate whether the pooled plan provider will use 
itself or an affiliate to operate the plan. Complete as many entries as 
necessary.
    For purposes of the Form PR, the term affiliate includes all 
persons who are treated as a single employer with the person intending 
to be a pooled plan provider under section 414(b), (c), (m), or (o) of 
the Internal Revenue Code and are expected to provide services to 
pooled employer plans sponsored by the pooled plan provider, and any 
officer, director, partner, employee, or relative (as defined in 
section 3(15) of the Act) of such person; and any corporation or 
partnership of which such person is an officer, director, or partner.
    Note. The pooled plan provider must serve as the named fiduciary 
and acknowledge in writing its status as such. The pooled plan provider 
must acknowledge that it is the plan administrator and responsible for 
the administration of each pooled employer plan and acknowledge in 
writing its status as such.
    Line 4a. You must answer Line 4a; you may not leave it blank. 
Answer ``Yes,'' if there have been any criminal convictions, terms of 
imprisonment served, or civil judgments against the pooled plan 
provider or any officer, director, or employee of the pooled plan 
provider, in the 10 years preceding the registration related to the 
provision of services to, operation of, or investments of any employee 
benefit plan in any criminal, civil, or administrative enforcement 
proceeding by a federal or state agency or other regulatory authority 
in any federal or state court or administrative tribunal. If you answer 
``Yes,'' you must complete all the elements in Line 4b. For purposes of 
responding to the Form PR, employees of the pooled plan provider 
include employees of the pooled employer plan, but only those who 
handle assets of the plan within the meaning of section 412 of ERISA or 
who are responsible for the operations or investments.
    Line 5a. You must answer Line 5a; you may not leave it blank. 
Answer ``Yes,'' if there any pending criminal, civil, or administrative 
enforcement proceeding, related to the provisions of services to, 
operation of, or investments of any employee benefit plan, by a federal 
or state agency or other regulatory authority in any federal or state 
court or administrative tribunal against the pooled plan provider or 
any officer, director, or employee of the pooled plan provider. If you 
answer ``Yes,'' you must complete elements in Line 5b.
    Part III--Supplemental Reportable Event Information.
    You must supplement your registration statement by reporting 
information about each pooled employer plan before beginning operations 
as a pooled employer plan. You must also supplement your registration 
statement by reporting any change in the information previously 
reported or other change in pooled plan provider circumstances within 
30 days of the occurrence of the change or of the reportable events 
described below. You may file a single supplement to your Form PR to 
report multiple simultaneous changes, e.g., beginning to operate two or 
more pooled employer plans, or to report a change that applies to the 
pooled plan provider with respect to all pooled employer plans it 
operates.
    Line 6. Type of Supplemental Information. Check the box to identify 
whether Part III includes information about a new pooled employer plan, 
any change in information previously reported, or a change in pooled 
plan provider circumstances. Make sure that all the information in the 
Form PR you are submitting is up to date.
    To correct information in a previously filed Form PR, check the 
``Amended'' filing box, along with correcting the information.
    Line 7. Pooled Employer Plan Information. Complete as many 
repeating entries as necessary to identify each pooled employer plan 
that the pooled plan provider begins operating. In elements a and b, 
respectively, enter the name and EIN for each pooled employer plan. In 
elements c(1) and c(2), respectively, enter the name, address and the 
EIN for the trustee(s) for the pooled employer plans operated by the 
pooled plan provider. In element c(3) enter the date the plan began 
operating as a pooled employer plan. Complete as many repeating entries 
as needed to identify all pooled plans administered by the registrant 
pooled plan provider and their trustees. In element c(4) enter the date 
the plan terminated and ceased operating as a pooled employer plan.
    Caution: You must use the same names, EINs, and other identifying 
information provided regarding any pooled employer plan as is provided 
on the Forms 5500 for such plans. Failure to use consistent identifying 
information on this form and the Forms 5500 for any pooled employer 
plan for which you serve as the pooled plan provider could result in 
correspondence from the Department of Labor or the Internal Revenue 
Service.
    Line 8. Change in Pooled Plan Provider Circumstances. Check the 
appropriate box(es) and enter all the requested information. Use as 
many repeating entries to enter all the required information. For 
example, if more than one action has been initiated, complete an entry 
for each action.
    Line 8a. If there has been a merger between the pooled plan 
provider and another entity, enter the date of the merger and identify 
the parties involved in the transaction.
    Line 8b. If there has been an acquisition by or of the pooled plan 
provider, enter the date of the acquisition and identify the parties to 
the transaction.
    Line 8c. If the pooled plan provider (or any affiliates) involved 
in the operations of or providing services to the pooled employer plan 
files for bankruptcy or receivership of the pooled plan provider enter 
date of filing, enter name of court where action is proceeding, and 
enter caption and docket number for the proceeding.
    Line 8d. Enter the date the pooled plan provider ceased operations.
    Line 8e. You must complete Line 8e upon receiving written notice 
that there has been an initiation of any administrative enforcement 
action in any court or administrative tribunal by any federal or state 
government agency or other regulatory authority against the pooled plan 
provider or any officer, director, or employee of the pooled plan 
provider, related to the provision of services to, operation of, or 
investments of any pooled employer plan or other employee benefit plan.
    Line 8f. You must complete Line 8f upon receiving written notice of 
a finding by a federal or state court or governmental agency of fraud 
or dishonesty against the pooled plan provider or any officer, 
director, or employee of the pooled plan provider, related to the 
provision of services to, operation of, or investments of any pooled 
employer plan or other employee benefit plan.
    Line 8g. You must complete Line 8g upon learning that any criminal 
charges

[[Page 54311]]

have been filed in any federal or state court against the pooled plan 
provider or any officer, director, or employee of the pooled plan 
provider, related to the provision of services to, operation of, or 
investments of any pooled employer plan or other employee benefit plan.

Paperwork Reduction Act Notice

    We ask for the information on this form to carry out the law as 
specified in ERISA sections 3(43) (29 U.S.C. 1002(43)) and 3(44) (29 
U.S.C. 1002(44)). You are required to give us the information if you 
wish to operate as a pooled plan provider. We need it to determine 
whether the pooled plan provider is eligible to operate as such under 
ERISA and the Code. You are not required to provide the information 
requested on a form that is subject to the Paperwork Reduction Act 
unless the form displays a valid OMB control number. Books and records 
relating to a form or its instructions must be retained as long as 
their contents may become material in the administration of the 
Internal Revenue Code or are required to be maintained pursuant to 
ERISA.
    Generally, filings on Form PR (Registration Statement for Pooled 
Plan Providers) are open to public inspection and are subject to 
publication on the internet. You are not required to respond to this 
collection of information unless it displays a current, valid OMB 
control number. The average time needed to complete and file the form 
is estimated below. These times will vary depending on individual 
circumstances.
    The estimated average time to complete are as follows:

Initial filing: 45 minutes
Supplemental filing: 30 minutes
Amended filing: 30 minutes
Final filing: 30 minutes

    If you have comments concerning the accuracy of these time 
estimates or suggestions for making this form simpler, we would be 
happy to hear from you. You can write to: U.S. Department of Labor, 
Office of Policy and Research, Attention: PRA Official, 200 
Constitution Avenue NW, Room N-5711, Washington, DC 20210 and reference 
Form PR (Registration Statement for Pooled Plan Providers). Do not send 
this form to this address. The forms and schedules must be filed 
electronically. See How To File-Electronic Filing Requirement.

                           OMB Control Numbers
------------------------------------------------------------------------
                         Agency                               OMB No.
------------------------------------------------------------------------
Employee Benefits Security Administration...............           1210-
Internal Revenue Service................................           1545-
------------------------------------------------------------------------

[FR Doc. 2020-18504 Filed 8-27-20; 4:15 pm]
BILLING CODE 4510-29-P