Department of Labor March 10, 2005 – Federal Register Recent Federal Regulation Documents

This document contains a notice of a proposed class exemption from certain prohibited transaction restrictions of the Employee Retirement Income Security Act of 1974 (ERISA or the Act) and from certain taxes imposed by the Internal Revenue Code of 1986, as amended (the Code). If granted, the proposed class exemption would permit a ``qualified termination administrator'' (QTA) of an individual account plan that has been abandoned by its sponsoring employer to select itself or an affiliate to provide services to the plan in connection with the termination of the plan, and to pay itself or an affiliate fees for those services. The proposed exemption also would permit a qualified termination administrator of an abandoned plan to: Designate itself or an affiliate as provider of an individual retirement plan or other account; select a proprietary investment product as the initial investment for the rollover distribution of benefits for a participant or beneficiary who fails to make an election regarding the disposition of such benefits; and pay itself or its affiliate fees in connection therewith. This exemption is being proposed in connection with the Department's proposed regulation to be promulgated at 29 CFR 2578, relating to the Termination of Abandoned Individual Account Plans, and 2550.404a-3, relating to the Safe Harbor For Rollover Distributions from Terminated Individual Account Plans, which are being published simultaneously in this issue of the Federal Register. The proposed exemption, if granted, would affect individual account plans, the participants and beneficiaries of such plans, certain plan service providers, and the fiduciaries of such plans.