Over the last year or so, we’ve been keeping tabs on the rules surrounding fee disclosure in all of its forms current and newly proposed. Specifically, the new proposals are the final 408(b)(2) disclosures and the Participant fee disclosure rules under ERISA §404(a)(5). The 408(b)(2) rules have been delayed twice and are currently due to come into effect on January 1st, 2012. In a filing just published at the Federal Register, the U.S. Department of Labor has officially proposed the previously discussed extension for those 408(b)(2) regulations. The Federal Register filing formally effectuates that intent.
The new announcement in this filing is that the DOL stated it would propose an amendment to the participant level fee disclosure regulation which would provide a 120-day transition period (instead of 60 days) to provide the initial participant disclosures. However, it does not appear there will be any extension provided for quarterly expense disclosures. According to the DOL release , a calendar year plan would have to furnish the initial participant disclosures no later than April 30, 2012. The quarterly expense disclosures required by paragraphs (c)(2)(ii) and (c)(3)(ii) of the regulation (e.g., quarterly statement of fees/expenses actually deducted) would have to be furnished no later than May 15, 2012.
In essence, this gives the service providers an extra quarter to get into compliance. Not a big deal, but worth noting as in previous posts we referenced Q4, 2011 and now it will be Q1, 2012.
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