Alert: Fee Disclosure Rules for Defined Contribution Plans: Deadlines Extended for Disclosures to Plan Participants & New Obligations on Plan Sponsors under Service Provider Regulations

March 2012

At the end of 2011, we alerted you to final regulations (the “Final Regulations”) by the U.S. Department of Labor (“DOL”) that would apply as early as May 31, 2012 requiring plan administrators of participant-directed defined contribution retirement plans that are covered by the Employee Retirement Income Security Act (“ERISA”) to disclose certain plan and investment-related information, including fee, expense and investment performance information, to participants and beneficiaries. (For background and more detailed information regarding the Final Regulations, see our previous Alert located at http://www.pbwt.com/2012-new-disclosures-to-defined-contribution-plan-participants/) The DOL has now taken action that extends the deadlines associated with the Final Regulations by three months. The impact of this extension on the specific notices under the Final Regulations are as follows:

  • First Initial Notices: For calendar year plans and non-calendar year plans with a plan year beginning between November 1, 2011 and July 1, 2012, Initial Notices must be furnished by August 30, 2012 (instead of May 31, 2012 as reported in our initial Alert).

    For plans with a 2012 plan year that begins after July 1, 2012 and before November 1, 2012, Initial Notices must be furnished within 60 days following the first day of the plan’s 2012 plan year (for example, for a plan with a plan year that runs September 1 through August 31, the first Initial Notice under the Final Regulations will be due by October 31, 2012).

  • First Quarterly Disclosures. Because the first quarterly disclosures are due 45 days after the end of the first quarter in which the first Initial Notices are due, for calendar year plans and most non-calendar year plans the first quarterly disclosure must generally be furnished by November 14, 2012 (instead of August 14, 2012 as reported in our initial Alert).

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