Timeline of the Department of Labor’s Fiduciary Rule (Rules 1.0 – 3.0)
The U.S. Department of Labor has been on a singular mission for well over a decade to extend ERISA fiduciary duty status on financial professionals — including insurance producers — when making product recommendations and investment advice to retirement plans, plan participants, and IRA owners.
- Rule 1.0: DOL first proposed a rule in 2010 but withdrew it a year later in the face of widespread opposition from members of Congress, industry and other interested parties.
- Rule 2.0: In April 2015, the Obama-era DOL released an updated proposal, upending the 1975 five-part test defining fiduciary investment advice and creating a new best interest contract exemption (BICE) that contained a host of unworkable conditions and requirements. Fiduciary Rule 2.0 was finalized in April 2016 but was ultimately vacated in its entirety by the U.S. Court of Appeals for the Fifth Circuit in March 2018.
- Rule 3.0: Two years later, the DOL under the Trump administration finalized a new prohibited transaction exemption, PTE 2020-02 which reinterpreted the prongs of the five-part test to effectively sweep in most all retirement advice or product recommendations as fiduciary in nature, including rollover advice, and, thus, requiring the use of a prohibited transaction exemption in order to receive compensation for that guidance. PTE 2020-02 was finalized in February 2021 and made effective in February 2022.
- Rule 4.0: Last fall, the DOL proposed yet another new fiduciary rule package, again redefining who is an investment advice fiduciary and amending existing PTEs, including both PTE 2020-02 and PTE 84-24. Access NAFA content and links to resources on Rule 4.0 here.
View detailed information about Rules 1.0 – 3.0, NAFA and industry responses, litigation, and other critical timeline updates below.
Fiduciary Rule 3.0
June 30, 2023
May 15, 2023
April 14, 2023
February 13, 2023
January 24, 2023
Oral arguments are held in the FACC case before District Magistrate Judge Rebecca Rutherford.
Cross-filing of Motions for Summary Judgment
Subsequent to the filing of the complaints by ASA and FACC, plaintiffs in both lawsuits and the DOL defendants agree to expedited schedules for summary judgment proceedings in lieu of the DOL answering the complaints. Both lawsuits are docketed for summary judgment proceedings in the respective venues.
February 9, 2022
February 1, 2022
February 1, 2022
The DOL Fiduciary Rule 3.0 goes into effect.
April 12, 2021
The Department of Labor issues two sets of Questions and Answers on PTE 2020-02. One set was a detailed analysis for the industry that included guidance that may be subject to additional more onerous regulation. The other Q&A was designed for consumers and titled “Choosing the Right Person to Give You Investment Advice: Information for Investors in Retirement Plans and Individual Retirement Accounts.
- “Choosing the Right Person to Give You Investment Advice: Information for Investors in Retirement Plans and Individual Retirement Accounts” includes questions a retirement investor can ask when interviewing potential advice providers, background information to help them understand the purpose of each question, and investor-focused frequently asked questions about the exemption.
- A set of compliance-focused frequently asked questions provides guidance for investment advice providers who are relying, or planning to rely, on the exemption.
February 12, 2021
In a surprising move the Department of Labor issues a statement that the DOL will let PTE 2020-02 go into effect on February 16, 2021. This statement shocked the industry and provided that the DOL provided that more information would be forthcoming.
December 18, 2020
The Department of Labor finalizes PTE 2020-02. This becomes effective February 16, 2021. This regulation was promulgated within 60 days of a new Administration so was subject to withdrawal by the new Biden Administration.
September 3, 2020
As part of an industry trade coalition, NAFA testifies before the DOL on the ramifications of the proposed rule and the importance to provide a carve out for Independent Agents providing one-off transactional advice to rollover participants.
August 6, 2020
NAFA submits a letter in response to the Department of Labor’s request for comments regarding its Notification of Proposed Class Exemption, “Improving Investment Advice for Workers and Retirees.
July 7, 2020
The Department of Labor issues proposed regulation “Improving Investment Advice for Workers and Retirees” that provides Proposed Prohibited Transaction Exemption 2020-02. This was deemed DOL Fiduciary Rule 3.0 and PTE 2020-02 is the latest iteration for compliance with Rollover and IRA transactions.
The DOL rule brings back the five-part test to determine if an advisor is a fiduciary as follows:
- The financial advisor must render advice as to the value of securities or other property;
- The advisor must do so on a regular basis;
- The advisor must do so under an agreement with the client;
- That advice will serve as a primary basis for the client’s investment decisions; and
- The recommendation is to be based on the particular needs of the investment or retirement plan.
In addition to the five-part test, the DOL withdrew guidance it had previously issued in the Deseret Letter.
Post-Issuance of Fiduciary Rule 2.0
May 2, 2018
The Fifth Circuit issues per curium order denying motions for intervention.
June 21, 2018
The U.S. Court of Appeals for the Fifth Circuit issues its highly anticipated mandate making official and permanent its March 15, 2018, decision to vacate the Department of Labor’s fiduciary rule in its entirety.
March 24, 2018
The NAFA Board of Directors announces it is withdrawing its lawsuit challenging the Department of Labor fiduciary rule. In a filing with the U.S. Court of Appeals for the D.C. Circuit, NAFA and the United States Department of Justice agreed to a voluntary dismissal of the appeal.
NAFA’s decision comes on the heels of a ruling by the Fifth Circuit Court of Appeals issued March 15, 2018, which vacated the fiduciary rule in its entirety. The NAFA lawsuit was one of two lawsuits challenging the authority of the Department of Labor to issue the rule.
March 16, 2018
September 15, 2017
August 9, 2017
July 25, 2017
April 17, 2017
In a letter submitted to the Department of Labor, NAFA, the National Association for Fixed Annuities is urging a further delay of the fiduciary duty rule beyond its current June 9 partial applicability date, while the Department completes its comprehensive examination of the rule as directed by President Trump in his White House Memorandum issued February 3.
March 14, 2017
February 17, 2017
November 29, 2016
November 23, 2016
November 7, 2016
October 27, 2016
August 25, 2016
June 16, 2016
June 2, 2016
April 26, 2016
April 21, 2016
April 6, 2016
April 6, 2016
Final Fiduciary Rule — Available in Federal Register Vol. 81, No. 68
Final Rule
Best Interest Contract Exemption
Class Exemption for Principal Transactions
Amendment to PTE 75-1, Part V
Amendments to and Partial Revocation of PTEs 86-128 and 75-1
Amendments to Class Exemptions 75-1, 77-4, 80-83 and 83-1
Amendment to and Partial Revocation of PTE 84-24
Pre-Issuance of Fiduciary Rule 2.0
December 9, 2015
December 4, 2015
October 30, 2015
October 9, 2015
September 24, 2015
August 10-13, 2015
Access the public hearing transcripts below.
August 10, 2015
August 11, 2015
August 12, 2015
August 13, 2015
August 12, 2015
View the television spots by clicking on the videos below.
August 6, 2015
July 29, 2015
July 21, 2015
View the Committee on Education and the Workforce comment letter here.
July 21, 2015
July 17, 2015
July 13, 2015
June 26, 2015
June 25, 2015
June 24, 2015
Download Reality versus the DOL Fiduciary Proposal fact sheet here.
Download the Flaws In A Fiduciary-Only/Best Practices Standard paper here.
June 23, 2015
June 18, 2015
Access NAFA’s position paper on Suitability: The Gold Standard here.
May 19, 2015
May 6, 2015
April 30, 2015
Fiduciary Rule 2.0
April 20, 2015
Available in Federal Register Vol. 80, No. 75
Proposed Conflicts of Interest Rule, Definition of “Fiduciary” – 29 CFR 2510.3-21
(80 FR 21928, rule text begins on page 21956)
Proposed Best Interest Contract Exemption – 29 CFR 2550 (80 FR 21960, rule text begins on page 21983)
Proposed Amendment to PTE 84-24 – (80 FR 22010, rule text begins on page 22018)
DOL’s Regulatory Impact Analysis – EBSA Conflicts of Interest RIA (The 11-page Executive Summary of the RIA provides a good understanding of the DOL’s position.)
Current Law/Code
Definition of “Fiduciary” – 29 CFR 2510.3-21
PTE 84-24 – See 71 FR 5887, as amended 2006
Prior to Issuance of Proposal
March 4, 2015
February 27, 2015
February 23, 2015
February 23, 2015
Fiduciary Rule 1.0
September 19, 2011
The U.S. Department of Labor’s Employee Benefits Security Administration announced that it will withdraw its proposed rule on the definition of a fiduciary. In announcing this decision, the agency conceded that it was due in part to requests from the public – including members of Congress – that the agency allow an opportunity for more input on the rule.
October 22, 2010
The Department of Labor – Employee Benefits Security Administration issues notice of proposed rulemaking (NPRM) in the Federal Register broadly redefining the circumstances under which a person is considered to be a fiduciary when giving investment advice to an employee benefits plan or a plan participant.
October 21, 2010
The U.S. Department of Labor’s Employee Benefits Security Administration today announced a proposed rule to update the definition of “fiduciary” to more broadly define the term as a person who provides investment advice to plans for a fee or other compensation. The department’s proposed rule would amend a 1975 regulation that defines when a person providing investment advice becomes a fiduciary under the Employee Retirement Income Security Act.
February 26, 2010
The White House announces U.S. Department of Labor rules that would “improve retirement security” as part of the WH Middle Class Task Force year-end report released by Vice President Joe Biden.