This comes after President Donald Trump’s February 3, 2017, Executive Order asking the Department of Labor to re-examine the Conflict of Interest Rule to determine whether it may adversely impact the ability of Americans to gain access to retirement information and financial advice.

The Conflict of Interest Rule imposes fiduciary status on investment advisors who make recommendations to participants in IRAs and ERISA-covered plans (e.g., 401(k) plans, etc.) with respect to securities or other investment property where the advisor receives a fee or other compensation for rendering the advice. The Rule also requires investment advisors to act in the best interest of the investor, limits the compensation that investment advisors can receive and imposes extensive disclosure and recordkeeping obligations upon them, including fee transparency.

The Rule’s fiduciary requirements were set to become enforceable in phases beginning on April 10, 2017. Following President Trump’s February 3 Executive Order, however, the DOL officially extended the first, partial effective date of the final regulation to June 9, 2017, while the agency conducted the required review.

Secretary Acosta stated in his article this week that the DOL will “seek additional public input on the entire Fiduciary Rule.” However, he emphasized that the agency has “found no principled legal basis to change the June 9 date while [it] seek[s] public input.”

Therefore, firms and advisors will become fiduciaries as of 11:59 p.m. on June 9 and must either structure their compensation arrangements to avoid prohibited transactions or comply with an exemption such as the Best Interest Contract Exemption or the Principal Transactions Exemption.

Additional information concerning the phased-in implementation of the Rule can be found on the updated FAQ issued by the Employee Benefits Security Administration to coincide with Secretary Acosta’s article.

The U.S. Department of Labor’s decision to move forward with the June 9 implementation of the Fiduciary Rule does not mean that the agency has concluded its review of the Rule. To the contrary, Secretary Acosta announced that the agency will seek public comment as it continues to analyze the impact of the Rule on institutions, advisors and investors.

The Fiduciary Rule may be revised as a result of input received during that notice and comment period. Alternatively, implementation of the Rule may yet be impacted by court decisions, executive order or subsequent legislation.