The U.S. Department of Labor (DOL) is seeking to delay implementation of certain provisions of its new fiduciary rule for retirement advice until mid-2019.
The DOL is set to publish a rule proposal that would further extend the transition period for aspects of the DOL fiduciary rule, which was introduced under former U.S. President Barack Obama and is now being questioned by the Trump administration. The DOL had already decided to delay implementation of parts of the rule until Jan. 1, 2018 in response to an executive order. It’s now proposing to push the deadline back to July 1, 2019.
The DOL’s rule-making proposal, which is scheduled to be published in the Federal Register on Thursday, says that the primary purpose of the proposed delay is to give it more time to consider possible changes and alternatives to the rule’s provisions.
The agency says it’s “particularly concerned” that unless the implementation is delayed, the investment industry may occur costs to comply with requirements that it ultimately decides to revise or scrap altogether.
The DOL notes that, as it stands, the aspects of the rule that require financial services firms and advisors to “give prudent advice that is in retirement investors’ best interest, charge no more than reasonable compensation, and avoid misleading statements,” will remain in effect. However, certain enforcement provisions would be further delayed.
“We commend the DOL’s proposed delay announcement and will be submitting comments in support of the delay,” says Kenneth Bentsen Jr., president and CEO of investment industry trade group, the U.S. Securities Industry and Financial Markets Association, in a statement. “Finalizing a long-term delay as soon as practicable would be a positive step that would help mitigate customer confusion around the rule and give the DOL adequate time to complete its comprehensive review as mandated by the president.”