On March 10, 2017, the Department of Labor (“DOL”) issued “Field Assistance Bulletin No. 2017-01,” notifying financial services firms that the DOL will not, “in the short term,” pursue enforcement of its proposed new fiduciary “investment advice” rule (the “Rule”) under the Employee Retirement Income Security Act of 1974. The DOL bulletin is intended to address confusion regarding the apparent conflict between the April 10, 2017 Rule implementation date and the potential for a 60-day delay in implementation of the Rule. Specifically, the DOL recognizes the likelihood that there will be a “gap period” between the current April 10 implementation date and the date that the DOL issues a final rule delaying implementation of the Rule.

The problem arose when on March 2, 2017, the DOL published for comment (15-day) a proposed 60-day delay of implementation of the Rule in order to give the DOL time to address a February 3, 2017 memorandum from President Trump to the Secretary of Labor requesting additional analysis of the Rule. The President’s memorandum instructed the DOL to analyze the economic and legal implications of the Rule in order to assess whether to modify or rescind the Rule to the extent necessary to bring the DOL in line with the Administration’s priorities.

The timing of this proposed 60-day delay caused significant uncertainty with firms as to how to proceed if the final rule on a 60-day delay is published after the April 10 implementation date or if the DOL decides not to issue a delay at all. Intended to provide firms some certainty pending final disposition of the Rule, the DOL Bulletin provides that the DOL will not pursue enforcement actions based on the Rule during any gap period. Further, the Bulletin provides that in the event the implementation date of the Rule is not ultimately extended beyond the current April 10, 2017 date, the DOL will still refrain from initiating enforcement actions based on the Rule, provided that there is compliance with the Rule within a “reasonable period.” Notably, the Bulletin does not define “reasonable period.” Moreover, the Bulletin does not address, much less provide any protections, with respect to the private-civil-action enforcement aspects of the Rule.

Further complicating matters is a new round of legal challenges seeking to further delay or permanently derail the Rule. The prevailing uncertainty must be considered in connection with any decision about whether to defer or stop current efforts to comply with the Rule.