August 23, 2022

Trade Associations Request Extension to Respond to Proposal on "QPAM" Class Exemption

A group of financial trade associations requested an extension to a comment deadline on proposed amendments to the Prohibited Transaction Class Exemption 84-14 (the "QPAM" Exemption). The exemption allows qualified registered investment advisers, banks, savings and loan associations and insurance companies to engage in otherwise prohibited transactions related to ERISA plan assets.

In a letter to the Office of Exemption Determinations, Employee Benefits Security Administration at the Department of Labor, the associations argued that the DOL should further consider the significant costs the proposed amendments will impose on plans, participants and providers. The associations said that implementing the proposal would effectively require all ERISA and pension plan managers to amend their current agreements, imposing significant costs on fund managers. Additionally, the associations argued that the proposal "significantly expands the [DOL]'s reach and overhauls the relationship between plan sponsors and their chosen advisors." The associations maintained that, as is, the proposal would produce unintended consequences that would ultimately harm consumers.

Accordingly, the associations requested a 60-day extension on the current comment deadline of September 26, 2022 to allow market participants additional time to understand the full impact of the proposal.