The guidance is the first of three waves of FAQs.
On October 27, the US Department of Labor (DOL) released a long-awaited frequently asked questions (FAQs) document regarding the fiduciary rule, as released on April 8, 2016 (the Rule), and related prohibited transaction exemptions (PTEs). The FAQs aim to answer 34 questions on the new exemptions, including the Best-Interest Contract Exemption, and amendments to existing exemptions, such as PTEs 75-1, 77-4, 80-83, 83-1, 84-24, and 86-128.
The DOL indicated that this is the first wave of FAQs that it will release about the Rule. Phyllis Borzi, the assistant secretary of labor at the DOL’s Employee Benefits Security Administration, confirmed that the DOL is aiming to release three sets of FAQs in total, with the second wave coming “very soon.”
Assistant Secretary Borzi asserted in a recent blog post that the FAQs are based on input that the DOL received from the financial services industry and others. She stated that the DOL hopes these FAQs will “head off misunderstandings that could lead to bad results for retirement savers, or financial services professionals.”