WASHINGTON (March 20, 2026) — NAFA is proud to announce its efforts, in partnership with the American Council of Life Insurers (ACLI), Finseca, the Insured Retirement Institute (IRI), and the National Association of Insurance and Financial Advisors (NAIFA) and its participating chapters, to continue protecting the industry from the Department of Labor’s overreach via its lawsuit filed May 24, 2024, which challenged the legality of the Biden-era 2024 fiduciary rule, have succeeded.
On March 17, 2026, federal district court judge Reed O’Connor vacated the 2024 Department of Labor fiduciary rule and all of the amendments to the associated Prohibited Transaction Exemptions, granting the joint trade plaintiffs’ unopposed motion for entry of final judgment. Under the terms of the unopposed motion, the Department of Labor acknowledged that it has had “full and sufficient opportunity to present any arguments against vacatur of the Rule” and further agreed that the proper remedy is universal vacatur of the Rule in its entirety.
Moreover, DOL acknowledged that the holding of the 2018 Chamber of Commerce case is controlling in this case, with the Court explaining that Chamber “unambiguously forecloses all of [DOL’s] arguments” in defense of the Rule. The Chamber Court held that ERISA “codified the common law understanding” of fiduciary status “a relationship of trust and confidence between a fiduciary and her client” and embraced the “industry distinction between investment advice and mere sales conduct.”
NAFA president and CEO Chuck DiVencenzo reflected on the years-long legal challenge: “This decision is a direct result of the strength and unity of our membership. NAFA members showed up, remained engaged and supported this effort every step of the way. The collective commitment to protecting consumers’ access to financial guidance made this outcome possible and will continue to drive our work moving forward.”
The following day, the U.S. Department of Labor Employee Benefits Security Administration (EBSA) announced a Final Rule and technical amendment that would vacate in its entirety the preamble to the 2020 fiduciary rule, Prohibited Transaction Exemption (PTE) 2020-02. This decision implements the vacatur of the 2024 fiduciary rule and amendments to related PTEs, as well as the vacaturs of portions of the preamble language that resulted from earlier federal court decisions in cases challenging the Department’s guidance with respect to rollover advice.
Accordingly, the Department’s 2020 interpretation of the 1975 five-part test to determine fiduciary status has been revoked and the original 1975 test is restored. The exemption itself is also restored to its original formulation: the new Final Rule republishes in full the operative text of PTE 2020-02, as published in the Federal Register on Dec. 18, 2020. The Final Rule was published in the Federal Register today, and will take effect April 20, 2026.
Explaining their decision in vacating the preamble language, the Department stated, “To protect stakeholders from relying on preamble language that either has been directly invalidated by the courts’ vacaturs, or preamble language that may be rendered logically flawed or misinterpreted as a direct or indirect consequence of the courts’ vacaturs, the Department, in this document, clarifies its view that the entire preamble of PTE 2020-02 is effectively vacated.”
As a procedural matter, the Department determined that because it is merely giving effect to the courts’ orders and is not exercising discretion, the action here is not subject to the notice and comment requirements under the Administrative Procedures Act. Moreover, the 2020-02 preamble was an interpretive position and not final agency rulemaking action requiring notice and comment; this new Final Rule is simply “unmaking that preamble interpretively.”
“This is a very welcome and extremely positive development for our industry and for NAFA members. For more than 15 years and through multiple iterations of this rulemaking process, NAFA and its members have remained steadfast in their commitment to reaching the right outcome. That perseverance and collaboration have been essential to getting here. We will continue to advocate for retirement policy that preserves consumers’ access to professional financial guidance and that recognizes the vital role annuities play in helping Americans achieve lasting financial security in retirement,” DiVencenzo remarked.