The Department of Labor ("DOL") issued a Field Assistance Bulletin announcing a "temporary enforcement policy" related to the recently proposed 60-day delay of the April 10, 2017 applicability date (see previous coverage) for the DOL's rule defining who is a fiduciary under ERISA and Section 4975 of the Internal Revenue Code and certain related prohibited transaction exemptions ("PTEs"). The DOL indicated that while it intends to issue a decision on the March 2, 2017 proposal before the original applicability date, it has determined that:

"[T]emporary enforcement relief is appropriate to protect against investor confusion and related marketplace disruptions attributable to uncertainty regarding the timing of the Department's decision on whether to delay the applicability date of the fiduciary duty rule and related PTEs."

Subject to certain conditions, the temporary enforcement policy states the following:

1. In the event the DOL issues a final rule after April 10, 2017 that implements a delay in the applicability date: The DOL will not initiate an enforcement action against advisers or financial institutions that failed to satisfy conditions of the fiduciary rule or relevant PTEs (including the provision of certain disclosures or other required documentation) during the "gap" period between when the rule became applicable and when the delay is implemented.

2. In the event the DOL decides not to issue a decision to delay the fiduciary duty rule and related PTEs: The DOL will not initiate an enforcement action against advisers or financial institutions that fail to satisfy conditions of the fiduciary rule or relevant PTEs as of April 10, 2017. This exemption applies so long as such advisers or financial institutions satisfy the applicable conditions (including those that relate to the provision of certain disclosures or other required documentation) within a reasonable period after the publication of a decision not to delay the applicability date.

The DOL noted that, to the extent circumstances relating to the decision on the proposed delay of the April 10 applicability date result in the need for other temporary relief, the DOL will consider taking additional action as necessary.

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