9376 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 

DEPARTMENT OF JUSTICE 

Antitrust Division 

Notice Pursuant to the National 

Cooperative Research and Production 

Act of 1993—3D PDF Consortium Inc. 

Notice is hereby given that, on 

January 22, 2021, pursuant to Section 

6(a) of the National Cooperative 

Research and Production Act of 1993, 

15 U.S.C. 4301 et seq. (‘‘the Act’’), 3D 

PDF Consortium Inc. (‘‘3D PDF’’) has 

filed written notifications 

simultaneously with the Attorney 

General and the Federal Trade 

Commission disclosing changes in its 

membership. The notifications were 

filed for the purpose of extending the 

Act’s provisions limiting the recovery of 

antitrust plaintiffs to actual damages 

under specified circumstances. 

Specifically, Kubotek3D, Marlborough, 

MA, has been added as a party to this 

venture. 

Also, Linda Shave (individual), 

Endwell, NY; NetApp Inc., Waltham, 

MA; Patricia C. Franks (individual), 

NorthWard, Australia; Jean-Franc ̧ois 

Blanchette (individual), Los Angeles, 

CA; KOM Software, Ottawa, Canada; 

Terri Jackson (individual), Waterloo, 

Canada; Amitabh Srivastav (individual), 

Ottawa, Canada; Lucidi Piergiorgio 

(individual), Roma, Italy; Ontario 

Lottery Group, Toronto, Canada; Kamel 

Shaath (individual), Ottawa, Canada; 

Owen Ambur (individual), Hilton Head, 

SC; Rick Laxman (individual), Salt Lake 

City, UT; Bill Corey (individual), 

Charlottesville, VA; National Institute of 

Standards and Technology (NIST) 

Engineering Lab, Gaithersburg, MD; AFP 

Consortium, Corvallis, OR; Association 

for Digital Document Standards e.V., 

Berlin, Germany; and Aras Corporation, 

Andover, MA, have withdrawn as 

parties to this venture. 

Additionally, ITI TranscenData 

Business has changed its name to ITI, a 

Wipro company, Milford, OH. 

No other changes have been made in 

either the membership or planned 

activity of the group research project. 

Membership in this group research 

project remains open, and 3D PDF 

intends to file additional written 

notifications disclosing all changes in 

membership. 

On March 27, 2012, 3D PDF filed its 

original notification pursuant to Section 

6(a) of the Act. The Department of 

Justice published a notice in the Federal 

Register pursuant to Section 6(b) of the 

Act on April 20, 2012 (77 FR 23754). 

The last notification was filed with 

the Department on February 21, 2020. A 

notice was published in the Federal 

Register pursuant to Section 6(b) of the 

Act on March 11, 2020 (85 FR 14247). 

Suzanne Morris, 

Chief, Premerger and Division Statistics, 

Antitrust Division. 

[FR Doc. 2021–02919 Filed 2–11–21; 8:45 am] 

BILLING CODE P 

DEPARTMENT OF JUSTICE 

Antitrust Division 

Notice Pursuant to the National 

Cooperative Research and Production 

Act of 1993—National Spectrum 

Consortium 

Notice is hereby given that, on 

January 15, 2021, pursuant to Section 

6(a) of the National Cooperative 

Research and Production Act of 1993, 

15 U.S.C. 4301 et seq. (‘‘the Act’’), 

National Spectrum Consortium (‘‘NSC’’) 

has filed written notifications 

simultaneously with the Attorney 

General and the Federal Trade 

Commission disclosing changes in its 

membership. The notifications were 

filed for the purpose of extending the 

Act’s provisions limiting the recovery of 

antitrust plaintiffs to actual damages 

under specified circumstances. 

Specifically, PAE Applied 

Technologies, Fort Worth, TX; Mantech 

Advanced Systems International 

Incorporated, Herndon, VA; Intelsat 

General Communications LLC, McLean, 

VA; Micron Technology Inc., Seattle, 

WA; CellAntenna Corporation, Coral 

Springs, FL; NxGen Partners Manager, 

LLC, Dallas, TX; Granite 

Telecommunications, McLean, VA; 

1901 Group, LLC, Reston, VA; Anritsu 

Company, Morgan Hills, CA; Capraro 

Technologies, Inc., Utica, NY; Cirrus360 

LLC, Richardson, TX; Rafael System 

Global Sustainment, LLC, Bethesda, 

MD; Gigamon Inc., Santa Clara, CA; 

MedCognition, Inc., San Antonio, TX; 

Kutta Technologies, Inc., Phoenix, AZ 

have been added as parties to this 

venture. 

Also, Ball Aerospace & Technologies 

Corp, Fairborn, OH; Beatty and 

Company Computing Inc., Southlake, 

TX; Sprint Solutions, Inc., Overland 

Park, KS; Indiana Tool & Mfg. Co., Inc. 

DBA ITAMCO, Plymouth, IN; Bear 

Systems, Boulder, CO; Vectrona, LLC, 

Virginia Beach, VA; Pareto Frontier, 

LLC, Westford, MA; IJK Controls LLC, 

Dallas, TX; IMSAR LLC, Springville, 

UT; Phase Sensitive Innovations, Inc., 

Newark, DE; Technology Unlimited 

Group, San Diego, CA; University of 

Arizona—Electrical and Computer 

Engineering, Tucson, AZ have 

withdrawn as parties from this venture. 

No other changes have been made in 

either the membership or planned 

activity of the group research project. 

Membership in this group research 

project remains open, and NSC intends 

to file additional written notifications 

disclosing all changes in membership. 

On September 24, 2014, NSC filed its 

original notification pursuant to Section 

6(a) of the Act. The Department of 

Justice published a notice in the Federal 

Register pursuant to Section 6(b) of the 

Act on November 4, 2014 (79 FR 65424). 

The last notification was filed with 

the Department on November 10, 2020. 

A notice was published in the Federal 

Register pursuant to Section 6(b) of the 

Act on November 23, 2020 (85 FR 

74762). 

Suzanne Morris, 

Chief, Premerger and Division Statistics, 

Antitrust Division. 

[FR Doc. 2021–02918 Filed 2–11–21; 8:45 am] 

BILLING CODE 4410–11–P 

DEPARTMENT OF LABOR 

Employee Benefits Security 

Administration 

[Exemption Application No. D–12018] 

Proposed Exemption for Certain 

Prohibited Transaction Restrictions 

Involving DWS Investment 

Management Americas, Inc. (DIMA or 

the Applicant) and Certain Current and 

Future Asset Management Affiliates of 

Deutsche Bank AG (Each a DB QPAM) 

Located in New York, New York 

AGENCY: Employee Benefits Security 

Administration, Labor. 

ACTION: Notice of Proposed Exemption. 

SUMMARY: This document provides 

notice of the pendency before the 

Department of Labor (the Department) of 

a proposed individual exemption from 

certain of the prohibited transaction 

restrictions of the Employee Retirement 

Income Security Act of 1974 (ERISA or 

the Act) and/or the Internal Revenue 

Code of 1986 (the Code). If this 

proposed exemption is granted, certain 

entities with specified relationships to 

Deutsche Bank AG will not be 

precluded from relying on the 

exemptive relief provided by Prohibited 

Transaction Class Exemption 84–14. 

DATES: If granted, this proposed 

exemption will be in effect for a period 

of three (3) years beginning on April 18, 

2021. Written comments and requests 

for a public hearing on the proposed 

exemption should be submitted to the 

Department by March 22, 2021. 

Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 9377 

1For purposes of this proposed exemption, 

references to specific provisions of Title I of the 

Act, unless otherwise specified, should be read to 

refer as well to the corresponding provisions of 

section 4975 of the Code. 

2 49 FR 9494 (March 13, 1984), as corrected at 50 

FR 41430 (October 10, 1985), as amended at 70 FR 

49305 (August 23, 2005), and as amended at 75 FR 

38837 (July 6, 2010), hereinafter referred to as ‘‘PTE 

84–14’’ or the ‘‘QPAM Exemption.’’ 

3The Summary of Facts and Representations is 

based on the Applicant’s representations, and does 

not reflect factual findings or opinions of the 

Department, unless indicated otherwise. 

4 In general terms, a QPAM is an independent 

fiduciary that is a bank, savings and loan 

association, insurance company, or investment 

adviser that meets certain equity or net worth 

requirements and other licensure requirements and 

that has acknowledged in a written management 

agreement that it is a fiduciary with respect to each 

plan that has retained the QPAM. 

ADDRESSES: All written comments and 

requests for a hearing (at least three 

copies) should be sent to the Employee 

Benefits Security Administration 

(EBSA), Office of Exemption 

Determinations, U.S. Department of 

Labor, 200 Constitution Avenue NW, 

Suite 400, Washington, DC 20210, 

Attention: Application No. D–12018 or 

via private delivery service or courier to 

the Employee Benefits Security 

Administration (EBSA), Office of 

Exemption Determinations, U.S. 

Department of Labor, 122 C St. NW, 

Suite 400, Washington, DC 20001. 

Attention: Application No. D–12018. 

Interested persons may also submit 

comments and/or hearing requests to 

EBSA via email to e-OED@dol.gov or by 

FAX to (202) 693–8474, or online 

through http://www.regulations.gov. 

Any such comments or requests should 

be sent by the end of the scheduled 

comment period. The application for 

exemption and the comments received 

will be available for public inspection in 

the Public Disclosure Room of the 

Employee Benefits Security 

Administration, U.S. Department of 

Labor, Room N–1515, 200 Constitution 

Avenue NW, Washington, DC 20210. 

See SUPPLEMENTARY INFORMATION below 

for additional information regarding 

comments. 

FOR FURTHER INFORMATION CONTACT: 

Frank Gonzalez of the Department at 

(202) 693–8553. (This is not a toll-free 

number.) 

SUPPLEMENTARY INFORMATION: 

Comments 

Comments should state the nature of 

the person’s interest in the proposed 

exemption and the manner in which the 

person would be adversely affected by 

the exemption, if granted. Any person 

who may be adversely affected by an 

exemption can request a hearing on the 

exemption. A request for a hearing must 

state: (1) The name, address, telephone 

number, and email address of the 

person making the request; (2) the 

nature of the person’s interest in the 

exemption and the manner in which the 

person would be adversely affected by 

the exemption; and (3) a statement of 

the issues to be addressed and a general 

description of the evidence to be 

presented at the hearing. The 

Department will grant a request for a 

hearing made in accordance with the 

requirements above where a hearing is 

necessary to fully explore material 

factual issues identified by the person 

requesting the hearing. A notice of such 

hearing shall be published by the 

Department in the Federal Register. The 

Department may decline to hold a 

hearing if: (1) The request for the 

hearing does not meet the requirements 

above; (2) the only issues identified for 

exploration at the hearing are matters of 

law; or (3) the factual issues identified 

can be fully explored through the 

submission of evidence in written 

(including electronic) form. 

Warning: All comments received will 

be included in the public record 

without change and may be made 

available online at http://

www.regulations.gov, including any 

personal information provided, unless 

the comment includes information 

claimed to be confidential or other 

information whose disclosure is 

restricted by statute. If you submit a 

comment, EBSA recommends that you 

include your name and other contact 

information in the body of your 

comment, but DO NOT submit 

information that you consider to be 

confidential, or otherwise protected 

(such as Social Security number or an 

unlisted phone number) or confidential 

business information that you do not 

want publicly disclosed. However, if 

EBSA cannot read your comment due to 

technical difficulties and cannot contact 

you for clarification, EBSA might not be 

able to consider your comment. 

Additionally, the http://

www.regulations.gov website is an 

‘‘anonymous access’’ system, which 

means EBSA will not know your 

identity or contact information unless 

you provide it in the body of your 

comment. If you send an email directly 

to EBSA without going through http:// 

www.regulations.gov, your email 

address will be automatically captured 

and included as part of the comment 

that is placed in the public record and 

made available on the internet. 

Background 

The Department is considering 

granting an exemption under the 

authority of section 408(a) of the 

Employee Retirement Income Security 

Act of 1974, as amended (ERISA or the 

Act), and section 4975(c)(2) of the 

Internal Revenue Code of 1986, as 

amended (the Code), and in accordance 

with the procedures set forth in 29 CFR 

part 2570, subpart B (75 FR 66637, 

66644, October 27, 2011).1 If the 

proposed exemption is granted, certain 

qualified professional asset managers 

within the corporate family of Deutsche 

Bank AG (Deutsche Bank), including 

DWS Investment Management Americas 

Inc. (DIMA or the Applicant), and 

certain current and future affiliates of 

Deutsche Bank (each a DB QPAM) shall 

not be precluded from relying on the 

class exemptive relief granted in 

Prohibited Transaction Exemption (PTE) 

84–14 (PTE 84–14 or the QPAM Class 

Exemption), notwithstanding the 2017 

criminal conviction of DB Group 

Services UK Limited (the U.S. 

Conviction), provided the conditions set 

forth in the exemption are met.2 This 

proposed exemption, if granted, will be 

effective for a period of three (3) years 

beginning on April 18, 2021, provided 

that the conditions, as set forth below in 

Section I are satisfied. 

Summary of Facts and 

Representations 3

Deutsche Bank 

1. Deutsche Bank is a publicly-held 

global banking and financial services 

company headquartered in Frankfurt, 

Germany. Deutsche Bank, with and 

through its affiliates, subsidiaries, and 

branches, provides a wide range of 

services to corporations, institutions, 

governments, employee benefit plans, 

and private investors, among others. 

2. Deutsche Bank’s asset management 

affiliates that currently qualify as 

‘‘qualified professional asset managers’’ 

(as defined in Section VI(a) of PTE 84– 

14),4 and that rely on the relief provided 

by PTE 84–14, are DIMA, a Delaware 

corporation; RREEF America L.L.C., a 

Delaware limited liability company; 

DWS Alternatives Global Limited, an 

entity based in London, United 

Kingdom; and DWS Investments 

Australia Limited, which is based in 

Sydney, Australia (the DB QPAMs). The 

DB QPAMs’ clients include plans that 

are subject to Part 4 of Title I of ERISA 

(ERISA Plans) or section 4975 of the 

Code (IRAs) with respect to which the 

DB QPAMs rely on PTE 84–14, or with 

respect to which the DB Affiliated 

QPAMs (or a Deutsche Bank affiliate) 

have expressly represented that the 

managers qualify as a QPAM or rely on 

the QPAM Exemption. The proposed 

exemption refers to these plans as 

9378 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 

5Under the Code such parties, or similar parties, 

are referred to as ‘‘disqualified persons.’’ 

6The prohibited transaction provisions also 

include certain fiduciary prohibited transactions 

under section 406(b) of ERISA and 4975(c)(1)(E) 

and (F) of the Code. These include transactions 

involving fiduciary self-dealing, fiduciary conflicts 

of interest, and kickbacks to fiduciaries. PTE 84–14 

provides only very narrow conditional relief for 

transactions described in Section 406(b) of ERISA. 

7Section VI(d) of PTE 84–14 defines the term 

‘‘affiliate’’ for purposes of Section I(g) as ‘‘(1) Any 

person directly or indirectly through one or more 

intermediaries, controlling, controlled by, or under 

common control with the person, (2) Any director 

of, relative of, or partner in, any such person, (3) 

Any corporation, partnership, trust or 

unincorporated enterprise of which such person is 

an officer, director, or a 5 percent or more partner 

or owner, and (4) Any employee or officer of the 

person who—(A) Is a highly compensated employee 

(as defined in Section 4975(e)(2)(H) of the Code) or 

officer (earning 10 percent or more of the yearly 

wages of such person), or (B) Has direct or indirect 

authority, responsibility or control regarding the 

custody, management or disposition of plan assets.’’ 

8 80 FR 53574 (September 4, 2015). 

9 81 FR 75153 (October 28, 2016). 

10 81 FR 94028 (December 22, 2016). 

11 82 FR 61840 (December 29, 2017). 

12Unless otherwise noted, PTEs 2015–15, 2016– 

12, 2016–13, and 2017–04 are also referred to 

herein as the ‘‘Prior Exemptions.’’ 

Covered Plans. For purposes of this 

proposed exemption, a Covered Plan 

does not include an ERISA-covered plan 

or IRA to the extent the DB QPAM has 

expressly disclaimed reliance on QPAM 

status or PTE 84–14 in entering into a 

contract, arrangement, or agreement 

with the ERISA-covered plan or IRA. 

Relevant ERISA Provisions and PTE 84– 

14 

3. The rules set forth in section 406 

of ERISA and section 4975(c)(1) of the 

Code proscribe certain ‘‘prohibited 

transactions’’ between plans and related 

parties with respect to those plans. 

Under ERISA, such parties are known as 

‘‘parties in interest.’’ Under section 

3(14) of ERISA, parties in interest with 

respect to a plan include, among others, 

the plan fiduciary, a sponsoring 

employer of the plan, a union whose 

members are covered by the plan, 

service providers with respect to the 

plan, and certain of their affiliates.5

4. The prohibited transaction 

provisions under section 406(a) of 

ERISA and 4975(c)(1) of the Code 

prohibit, in relevant part, sales, leases, 

loans or the provision of services 

between a party in interest and a plan 

(or an entity whose assets are plan 

assets), as well as the use of plan assets 

by or for the benefit of, or a transfer of 

plan assets to, a party in interest.6

Under the authority of section 408(a) of 

ERISA and section 4975(c)(2) of the 

Code, the Department has the authority 

to grant exemptions from such 

‘‘prohibited transactions’’ in accordance 

with the procedures set forth in 29 CFR 

part 2570, subpart B (76 FR 66637, 

66644, October 27, 2011). 

5. PTE 84–14 reflects the 

Department’s conclusion that it could 

provide broad relief from the prohibited 

transaction provisions of section 406(a) 

of ERISA and 4975(c)(1) of the Code, in 

the circumstances set forth in that 

exemption, only if the commitments 

and the investments of plan assets, and 

the negotiations leading thereto, are the 

sole responsibility of an independent, 

discretionary manager. 

6. Section I(g) of PTE 84–14 prevents 

an entity that may otherwise meet the 

definition of a QPAM from utilizing the 

exemptive relief provided by PTE 84– 

14, for itself and its client plans, if that 

entity or an ‘‘affiliate’’ 7 thereof or any 

owner, direct or indirect, of a 5 percent 

or more interest in the QPAM has, 

within 10 years immediately preceding 

the transaction, been either convicted or 

released from imprisonment, whichever 

is later, as a result of criminal activity 

described in that section. 

7. The inclusion of Section I(g) in PTE 

84–14 is, in part, based on an 

expectation that QPAMs will maintain a 

high standard of integrity. This 

expectation extends not only to the 

QPAM itself, but also to those who may 

be in a position to influence the policies 

of the QPAM. 

Prior Conviction and Related 

Exemptions 

8. On October 11, 2011, DIMA first 

requested an administrative exemption 

from the Department (the First Request) 

to allow certain DB QPAMs to continue 

utilizing the relief set forth in PTE 84– 

14, notwithstanding an impending 

criminal conviction of Deutsche 

Securities Korea Co. (DSK), a Deutsche 

Bank subsidiary based in the Republic 

of Korea (Korea), under Korean law for 

spot/futures-linked market price 

manipulation (the Korean Conviction). 

9. While the Department was 

considering the First Request, DIMA 

submitted a second exemption 

application (the Second Request) to 

allow certain DB QPAMs to continue 

relying on PTE 84–14 for a period of 10 

years, notwithstanding both the Korean 

Conviction, and the then-anticipated 

additional criminal conviction of DB 

Group Services UK Limited (DB Group 

Services), Deutsche Bank’s indirect 

wholly-owned subsidiary based in 

London, United Kingdom, under U.S. 

law for one count of wire fraud in 

connection with its role in manipulating 

the United States Dollar (U.S. Dollar) 

based London Interbank Offered Rate 

(LIBOR) (the U.S. Conviction). 

10. On September 4, 2015, the 

Department published PTE 2015–15, in 

connection with the First Request, 

which provided temporary exemptive 

relief permitting DB QPAMs to continue 

relying on PTE 84–14 for a period of 

nine months, notwithstanding the 

Korean Conviction.8 PTE 2015–15 had 

an effective date of January, 25, 2016, 

which was the day on which the Korean 

court entered the Korean Conviction. 

11. On October 28, 2016, the 

Department granted PTE 2016–12, also 

in connection with the First Request, 

which extended the relief provided in 

PTE 2015–15.9 PTE 2016–12 had an 

effective date of October 24, 2016, and 

was scheduled to end on the earlier of 

April 23, 2017, or the effective date of 

the Department’s final action in 

connection with the exemption request. 

12. On December 22, 2016, the 

Department published PTE 2016–13, in 

connection with the Second Request, 

which granted temporary exemptive 

relief permitting DB QPAMs to rely on 

PTE 84–14 for a period of nine months, 

notwithstanding the Korean Conviction 

and the U.S. Conviction (collectively, 

the Convictions).10 PTE 2016–13 had an 

effective date of April 18, 2017, ending 

on the earlier of twelve months or the 

effective date of the Department’s grant 

of permanent exemptive relief. 

13. On December 29, 2017, the 

Department granted PTE 2017–04,11

which provided temporary exemptive 

relief, permitting the DB QPAMs to 

continue to rely on PTE 84–14 for a 

period of three years beginning April 18, 

2018, and ending on April 17, 2021, 

notwithstanding the Convictions. 

Thereafter, on February 18, 2018, the 

Department issued certain technical 

corrections with respect to PTE 2017– 

04.12

14. On December 12, 2018, Korea’s 

Seoul High Court for the 7th Criminal 

Division reversed the Seoul Central 

District Court’s decision and declared 

the defendants not guilty. Korea’s Seoul 

High Court’s decision is currently under 

appellate review. 

The Applicant’s Third Exemption 

Request 

15. On April 24, 2020, the Applicant 

submitted another prohibited 

transaction exemption application (the 

Third Request) seeking to extend the 

relief provided in PTE 2017–04, which 

expires on April 17, 2021, for an 

additional six years. The Applicant 

requested that the reversed Korean 

Conviction not be taken into 

consideration in enacting conditions for 

the Third Request. 

Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 9379 

13The Applicant cited the following individual 

exemptions: PTE 2017–03, JPMorgan Chase & Co., 

82 FR 61816 (December 29, 2017); PTE 2017–05, 

Citigroup Inc., 82 FR 61816 (December 29, 2017); 

and PTE 2017–06, Barclays Capital Inc., 82 FR 

61816 (December 29, 2017). 

16. According to the Applicant, since 

the granting of PTE 2017–04, the DB 

QPAMs have enhanced their policies 

and procedures, implemented numerous 

protocols to improve their compliance 

processes, and acted in accordance with 

a culture of regulatory compliance in 

the asset management business. The 

Applicant states that, if the extension of 

PTE 2017–04 is denied, the DB QPAMs 

may be effectively eliminated as asset 

managers for many ERISA-covered 

plans and IRAs because they would be 

unable to provide the trading 

efficiencies and breadth of investment 

choices and potential counterparties 

afforded by the QPAM Exemption. 

17. The Applicant states that the 

proposed exemption may prevent the 

following harms/costs to affected plans: 

Loss of plans’ preferred asset manager; 

fees incurred to search, hire and 

transition to a new private manager; 

and/or transaction costs relating to early 

liquidation of real estate and other 

investments. 

18. The Department specifically 

requests that the Applicant provide 

information verifying the various 

potential costs and harms associated 

with denial of the exemption. In 

addition, the Department requests that 

the Applicant provide information on 

the size of any adverse impacts relative 

to the size of the affected portfolios; any 

costs or harms in excess of the normal 

transaction costs associated with 

changing asset managers; and the basis 

for concluding that any benefits to 

affected investors would be insufficient 

to offset any transaction costs or other 

adverse impacts flowing from denial of 

the exemption. The Department also 

specifically requests comments from the 

public, particularly including Covered 

Plans and IRA owners, on these same 

issues, including the magnitude of 

possible costs or harms, if any, that 

would stem from denial of the 

exemption, as well as the public’s views 

on whether the Department should deny 

the exemption, rather than adopt the 

proposal as set forth herein. 

Applicant’s Requested Modifications to 

PTE 2017–04: No More Audits 

19. The Applicant requests that the 

DB QPAMs not be required to undergo 

further independent audits because: (a) 

The Independent Auditor determined 

that the DB QPAMs adhered to the 

conditions in the previously granted 

related exemptions; (b) the U.S. 

Conviction occurred outside of the DB 

QPAMs’ operations, in an entity that is 

entirely separate from the asset 

management business; (c) the need for 

the current exemption rests on a single 

crime, and the exemption should be 

treated consistently with other 

similarly-situated applicants; 13 (d) the 

Compliance Officer requirement that 

PTE 2017–04 imposed is a reasonable 

substitute for a full audit; and (e) 

elimination of the audit requirement 

would benefit Covered Plan participants 

because audits are expensive and 

require the expenditure of significant 

amounts of time by the asset managers’ 

control functions. 

20. Alternatively, in the event that the 

Department requires additional audits, 

the Applicant asks the Department to 

impose an audit requirement every 

other year, as imposed on other 

applicants convicted of a single crime. 

Department’s Response: As noted by 

the Applicant, the Department has 

previously granted individual 

exemptions containing biennial audits, 

that permit asset managers to continue 

to rely on the relief provided by PTE 

84–14, notwithstanding a single 

violation of Section I(g) of PTE 84–14. 

Those exemptions (the FX Exemptions) 

arose from judgments of convictions 

against JPMorgan Chase & Co., Citicorp 

and Barclays PLC, for violations of the 

Sherman Antitrust Act, 15 U.S.C. 1, for 

criminal misconduct affecting the 

Foreign Exchange (FX) Spot Market (the 

FX Convictions). The conditions in the 

FX Exemptions include a biennial audit. 

21. In developing the FX Exemptions, 

the Department considered a variety of 

factors associated with the criminal 

misconduct that gave arise to the FX 

Convictions. In granting the FX 

Exemptions, the Department determined 

that a biennial audit, combined with the 

FX Exemptions’ other protective 

conditions, provided adequate 

protection for affected Covered Plans. 

22. With respect to this proposed 

exemption, the Department considered a 

variety of factors specific to this 

application. The scope and seriousness 

of the misconduct by the DB Group 

Services’ traders (the Traders) was 

extensive and egregious. The Traders 

manipulated LIBOR, which is a variable 

rate that is linked to the global 

derivatives market, which includes plan 

investors. According to the Statement of 

Facts filed in the U.S. Conviction, from 

approximately 2003 through at least 

2010, the Traders defrauded their 

counterparties by secretly manipulating 

the LIBOR for the U.S. Dollar, Yen, and 

Pound Sterling, as well as the EURIBOR 

(collectively, the IBORs). The Traders 

requested that the IBORs submitters that 

Deutsche Bank employed send IBORs 

that would benefit the traders’ 

derivatives positions rather than 

accurate rates that comported with the 

definitional provisions governing 

IBORs. The Traders’ misconduct 

affected the value, and cash flows, of 

derivatives contracts, including interest 

rate swap contracts. 

23. The Department also notes that on 

January 8, 2021, Deutsche Bank entered 

into a deferred prosecution agreement 

with the U.S. Department of Justice. 

Deutsche Bank agreed to pay more than 

$130 million to resolve the U.S. 

government’s investigation into 

violations of the Foreign Corrupt 

Practices Act (FCPA) and a separate 

investigation into a commodities fraud 

scheme. The resolution includes 

criminal penalties of $85,186,206, 

criminal disgorgement of $681,480, 

victim compensation payments of 

$1,223,738, and $43,329,622 to be paid 

to the U.S. Securities & Exchange 

Commission. In the deferred 

prosecution agreement, Deutsche Bank 

admitted, accepted, and acknowledged 

that, among other things, it was 

responsible under United States law for 

the acts of its officers, directors, 

employees, and agents, as charged. The 

charges stem from a scheme to conceal 

corrupt payments and bribes made to 

third-party intermediaries by making 

false entries on Deutsche Bank’s books 

and records, as well as related internal 

accounting control violations, and a 

separate scheme to engage in fraudulent 

and manipulative commodities trading 

practices involving publicly-traded 

precious metals futures contracts. The 

FCPA misconduct occurred between 

2009 and 2016, and the Commodities 

fraud misconduct occurred between 

2009 and 2013. 

24. After reviewing the record, 

including evidence of the magnitude, 

gravity, duration and pervasiveness of 

the LIBOR misconduct, the FCPA 

misconduct, and the commodities fraud 

misconduct, the Department believes 

that a three-year exemption with annual 

audits is appropriate. The Department 

further views it as appropriate to 

preclude relief to the extent that either: 

The DB QPAMs were involved in the 

conduct that gave rise to the deferred 

prosecution agreement; or Covered Plan 

assets were involved in the transactions 

that gave rise to the deferred 

prosecution agreement. A three-year 

exemption will enable the Department 

to review the DB QPAMs’ ongoing 

compliance efforts after a reasonable 

period, and determine whether any 

adjustments are necessary to the 

conditions of this exemption. The need 

for such ongoing review is amply 

9380 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 

14 Dominic Lau, et al., Deutsche Bank Probing 

Sales of Investment Banking Products, 

Bloomberg.com, https://www.bloomberg.com/news/ 

articles/2021-01-24/deutsche-bank-probesmisselling-of-investment-bank-products-ft (last 

updated Jan. 25, 2021). 

15Specifically, Section II(a) of PTE 2017–04 

defines the term ‘‘Convictions’’ to mean, in part: (1) 

The judgment of conviction against DB Group 

Services, in Case 3:15–cr–00062–RNC to be entered 

in the United States District Court for the District 

of Connecticut to a single count of wire fraud, in 

violation of 18 U.S.C. 1343, and (2) the judgment 

of conviction against DSK entered on January 25, 

2016, in Seoul Central District Court, relating to 

charges filed against DSK under Articles 176, 443, 

and 448 of South Korea’s Financial Investment 

Services and Capital Markets Act for spot/futureslinked market price manipulation. 

16PTE 2017–03, 82 FR 61816 (December 29, 

2017); PTE 2017–05, 82 FR 61816 (December 29, 

2017); and PTE 2017–06, 82 FR 61816 (December 

29, 2017). 

supported by the seriousness of the 

misconduct cited above. In addition, 

however, the Department notes recent 

media reports concerning potential 

misconduct relating to the sale of a wide 

range of investment products, including 

hedges, swaps, and derivatives; a 

possible price-fixing conspiracy relating 

to Treasury securities; possible 

violations of the Markets in Financial 

Instruments Directive; and other 

matters.14 The Department requests 

comments from the Applicant and 

interested parties with information on 

these matters and their bearing on 

whether to grant the proposed 

exemption on the terms proposed. 

Applicant’s Requested Modification to 

PTE 2017–04: Removal of DSK and 

Revision of the Term ‘‘Convictions.’’ 

25. PTE 2017–04 provides relief for 

the U.S. Conviction and the Korean 

Conviction, using the defined term 

‘‘Convictions.’’ 15 The Applicant notes 

that DSK’s conviction in Korea was 

reversed, and requests that this 

proposed exemption redefine the term 

‘‘Convictions’’ to reference only the U.S. 

Conviction. The Applicant further 

requests that the Department remove all 

references to ‘‘DSK’’ in the operative 

language of the proposed exemption. 

Department’s Response: The 

Department concurs with the 

Applicant’s request. 

26. Employees Covered by Sections 

I(a) and I(b). Section I(a) of PTE 2017– 

04 provides, in pertinent part, that: 

‘‘[t]he DB QPAMs (including their 

officers, directors, agents other than 

Deutsche Bank, and employees of such 

QPAMs) did not know of, have reason 

to know of, or participate in the criminal 

conduct . . .’’ In addition, Section I(b) 

of PTE 2017–04 provides, in pertinent 

part, that: ‘‘[t]he DB QPAMs (including 

their officers, directors, and agents other 

than Deutsche Bank, and employees of 

such DB QPAMs) . . .’’ 

27. The Applicant requests that the 

Department add following language to 

Section I(a) after the words ‘‘such 

QPAMs:’’ ‘‘Who had responsibility for, 

or exercised authority in connection 

with, the management of plan assets.’’ 

The Applicant requests that the 

Department add the following language 

to Section I(b) after the words ‘‘such 

QPAMs:’’ ‘‘Who had responsibility for, 

or exercised authority in connection 

with, the management of plan assets.’’ 

28. The Applicant notes that the 

above-described language is consistent 

with parallel provisions in some of the 

other individual exemptions previously 

granted by the Department that involve 

a single conviction.16

Department’s Response: The 

Department is not persuaded that the 

conditions in this exemption should 

mirror the conditions in the exemptions 

cited by the Applicant. Each applicant 

for an exemption must demonstrate, and 

the Department must affirmatively find, 

on the record, that the requested relief 

is in the interest of, and protective of, 

affected plans and IRAs, and 

administratively feasible based on the 

specific record before it. In the 

Department’s view, the original 

language of PTE 2017–04 remains 

appropriate as applied to the Applicant. 

The Department also notes in this 

connection that it will not automatically 

decline to impose a condition it believes 

appropriate for the protection of affected 

plans and IRAs merely because an 

earlier exemption does not contain that 

condition. 

29. The conduct that is the subject of 

the exemptions cited by the Applicant, 

including the roles and corporate 

responsibilities of the persons who 

carried out that conduct, is materially 

different than, and distinguishable from, 

the conduct, including the roles and 

corporate responsibilities of the persons 

involved in the conduct that is the 

subject of this proposed exemption. The 

Applicant has not demonstrated that it 

would be in the interest of Covered 

Plans to grant relief that allows nonasset management personnel at a DB 

QPAM to have participated in the 

criminal conduct that gave rise to the 

U.S. Conviction. Finally, Section I(a) 

and (b) of this proposal are consistent 

with the Department’s understanding of 

the record, which includes express 

representations made by the Applicant. 

30. Training Conducted 

Electronically. Section I(h)(2) of PTE 

2017–04 provides that: ‘‘Each DB QPAM 

must develop and implement a program 

of training (the Training), to be 

conducted at least annually, for all 

relevant DB QPAM asset/portfolio 

management, trading, legal, 

compliance, and internal audit 

personnel . . . The training must: . . . 

(ii) Be conducted by a professional who 

has been prudently selected and who 

has appropriate technical training and 

proficiency with ERISA and the Code.’’ 

The Applicant requests that the 

Department add the following language 

to the proposed exemption: ‘‘[t]he 

Training may be conducted 

electronically or via website.’’ 

Department’s Response: Section 

I(h)(2) of this proposed exemption is 

consistent with the Applicant’s request, 

which is particularly appropriate 

because of the ongoing pandemic. 

31. Auditor’s Failure to Comply. 

Section I(i)(11) of PTE 2017–04 provides 

that: ‘‘The auditor must provide the 

Department, upon request, for 

inspection and review, access to all the 

work papers created and utilized in the 

course of the audit, provided such 

access and inspection is otherwise 

permitted by law.’’ In addition, Section 

I(r) of PTE 2017–04 provides that: ‘‘A 

DB QPAM will not fail to meet the terms 

of this exemption, solely because a 

different DB QPAM fails to satisfy a 

condition for relief described in Sections 

I(c), (d), (h), (i), (j), (k), (l), (o), and (q) 

if the independent auditor described in 

Section I(i) fails a provision of the 

exemption other than the requirement 

described in Section I(i)(11), provided 

that such failure did not result from any 

actions or inactions of Deutsche Bank or 

its affiliates.’’ 

32. The Applicant requests that relief 

to the DB QPAMs and the Covered Plans 

not be conditioned on the Independent 

Auditor’s cooperation with the 

Department or disclosure of work 

papers because the DB QPAMs and the 

Covered Plans cannot control the 

Independent Auditor’s actions. 

Department’s Response: The 

Department declines to make the 

Applicant’s requested revisions. The 

Department expects the DB QPAMs and 

the Independent Auditor to make every 

effort to ensure that their respective 

responsibilities under the exemption are 

fulfilled, and to contact the Office of 

Exemption Determinations in a timely 

manner any time guidance is needed. 

33. Modification of Notice 

Requirements. PTE 2017–04 requires 

that various notifications be given to 

Covered Plan clients, such as a notice of 

clients’ right to receive summary 

policies. The Applicant requests that 

this proposed exemption not require 

current Covered Plan clients to receive 

notifications that they previously 

received pursuant to PTE 2017–04. 

Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 9381 

17As noted in the text, the Department 

specifically requests comments on the scope and 

magnitude of alleged negative impacts, including 

any increased costs, which Covered Plans and IRAs 

would sustain if the Department were to deny the 

exemption. 

Department’s Response: Section I(j)(7) 

of this proposal is consistent with the 

Applicant’s request. 

34. Miscellaneous Provisions. The 

Applicant requests to modify the term 

‘‘General Counsel’’ as referred to in PTE 

2017–04, and changing such term to 

‘‘general counsel’’ since it is not a 

defined term. 

Department’s Response: This 

proposed exemption uses the term ‘‘the 

QPAM’s general counsel’’ to clarify 

relevant provisions of the proposed 

exemption. 

35. Lastly, the Applicant requests 

adding the phrase ‘‘or modifying’’ to the 

definition of Covered Plan in Section 

II(b) of PTE 2017–04, to clarify that a 

disclaimer may be made in a 

modification of a contract, arrangement, 

or agreement with a Covered Plan. The 

definition, once modified, would read, 

in pertinent part: ‘‘A Covered Plan does 

not include an ERISA-covered Plan or 

IRA to the extent the DB QPAM has 

expressly disclaimed reliance on QPAM 

status or PTE 84–14 in entering into or 

modifying its contract, arrangement, or 

agreement with the ERISA-covered plan 

or IRA.’’ 

Department’s Response: The 

Department declines to make the 

requested revision. The Applicant has 

not demonstrated that each of the DB 

QPAM’s processes for modifying its 

contracts, arrangements or agreements 

with Covered Plans would alert and 

inform a Covered Plan fiduciary to the 

same extent as an express disclaimer set 

forth in a Covered Plan’s initial contract, 

arrangement or agreement with a DB 

QPAM. 

Statutory Findings 

36. Section 408(a) of ERISA provides, 

in part, that the Department may not 

grant an exemption unless the 

Department finds that the exemption is 

administratively feasible, in the interest 

of affected plans and of their 

participants and beneficiaries, and 

protective of the rights of such 

participants and beneficiaries. 

a. ‘‘Administratively Feasible.’’ The 

Department has tentatively determined 

that the proposal is administratively 

feasible since, among other things, a 

qualified independent auditor will be 

required to perform an in-depth audit 

covering, among other things, each DB 

QPAM’s compliance with the 

exemption, and a corresponding written 

audit report will be provided to the 

Department and available to the public. 

The independent audit will provide an 

incentive for, and a measure of, 

compliance, while reducing the 

immediate need for review and 

oversight by the Department. 

b. ‘‘In the interest of.’’ The 

Department has tentatively determined 

that the proposed exemption is in the 

interests of the participants and 

beneficiaries of each affected Covered 

Plan. It is the Department’s 

understanding, based on representations 

from the Applicant, that if the requested 

exemption is denied, Covered Plans 

may be unable to maintain their 

investment strategy with their current 

asset manager, and may be subject to 

disruptions and costs associated with 

changing asset managers. The DB 

QPAMs claim that their ERISA plan 

clients have long availed themselves of 

the benefit of the DB QPAMs’ 

investment expertise, even after the 

grant of PTE 2017–04. As noted above, 

however, the Department specifically 

requests commenters, including 

Covered Plans and IRA owners, 

comment on the magnitude of costs or 

harms, if any, that would stem from 

denial of the Exemption. 

37. The DB QPAMs state that granting 

the exemption would enable the DB 

QPAMs to continue to effect a wide 

range of beneficial transactions on their 

ERISA clients’ behalf without undue 

administrative delay, or other 

conditions or limitations that could be 

disadvantageous to the ERISA plan 

clients. The Applicant represents that 

without the ability to serve as QPAMs, 

certain prudent and appropriate 

investment opportunities may not be 

available to the ERISA plan clients of 

Deutsche Bank asset managers. Here too, 

the Department specifically requests 

comments from Covered Plans and IRAs 

as to the specific costs or harms, if any, 

that would flow from denial of the 

exemption, including evidence as to any 

valuable investment opportunities that 

plans would have to forego, and the 

basis for concluding that those 

investments would no longer be 

available to plans on advantageous 

terms. 

38. The Applicant states that PTE 84– 

14 is one of the most commonly used 

prohibited transaction exemptions and, 

for some transactions, may be the only 

available exemption. If the requested 

exemption were not granted, ERISA 

plan clients could be effectively 

prohibited from entering into certain 

transactions, either because no other 

exemption is available or the 

counterparty is not willing to enter into 

the transaction without the protections 

provided by PTE 84–14. The Applicant 

claims that the loss of the ability to use 

PTE 84–14 could significantly delay or 

even make impossible transactions that 

would be beneficial for the ERISA 

plans.17

39. The Applicant represents that 

Covered Plan fiduciaries expend 

significant resources, including time 

and money, in selecting asset managers 

for their plans. Forcing Plan fiduciaries 

to terminate their chosen managers— 

because the managers are unable to rely 

on PTE 84–14’s relief will cause plans 

to incur a number of additional costs. 

The following costs are in addition to 

the opportunity costs of investing in 

cash pending reinvestment with a new 

manager; terminating such management 

services may result in the following 

specific harm to the relevant ERISA 

plan: Loss of the investor’s preferred 

manager, loss of leading investment 

manager/performance, consulting fees, 

time loss in evaluating alternative 

investment managers, legal fees, 

transaction costs for direct real estate 

early liquidation, costs for non-direct 

real estate liquidation, and legal costs 

for new trading agreements. If the 

extension of PTE 2017–04 were to be 

denied, then the DB QPAMs may be 

effectively eliminated as asset managers 

for many Covered Plans because they 

would be unable to provide the trading 

efficiencies, breadth of investment 

choices, and potential counterparties 

afforded by the QPAM Exemption. The 

Department specifically seeks comments 

from Covered Plans and IRAs, as well as 

the Applicant, on the validity of these 

concerns and the magnitude of the 

associated costs and harms, if any, 

should the Department decline to grant 

the requested exemption. 

c. ‘‘Protective of.’’ The Department 

has tentatively determined that this 

proposed exemption, if granted, is 

protective of Covered Plans. The 

proposal has a limited term of three 

years, and has similar conditions to PTE 

2017–04. However, the Department has 

determined to revise certain of those 

conditions so that it can make its 

required finding that the proposed 

three-year exemption will be protective 

of the rights of participants and 

beneficiaries of Covered Plans. For 

example, this proposed exemption 

clarifies that the term ‘‘participate in,’’ 

as referenced below, refers not only to 

active participation in the criminal 

conduct that is the subject of the U.S. 

Conviction, but also to knowing 

approval of the criminal conduct that is 

the subject of the U.S. Conviction, or 

knowledge of the conduct without 

9382 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 

18For clarity, references to the DB QPAMs 

include any individual employed by or engaged to 

work on behalf of these QPAMs during or after the 

period of misconduct. 

taking active steps to prohibit the 

conduct, including reporting the 

conduct to the individual’s supervisors, 

and to the Board of Directors. 

40. Several of this proposed 

exemption’s conditions are aimed at 

ensuring that the DB QPAMs were not 

involved in the conduct that gave rise to 

the U.S. Conviction. Accordingly, the 

proposal generally precludes relief to 

the extent the DB QPAMs were aware 

of, participated in, approved of, 

furthered, benefitted, or profited from, 

the conduct that gave rise to the U.S. 

Conviction.18 Further, the DB QPAMs 

may not employ or knowingly engage 

any of the individuals that participated 

in the conduct attributable to the U.S. 

Conviction. 

41. The proposal further provides that 

no DB QPAM will use its authority or 

influence to direct an ‘‘investment 

fund’’ that is subject to ERISA or the 

Code and managed by such DB QPAM 

with respect to one of more Covered 

Plans, to enter into any transaction with 

DB Group Services to provide any 

service to such investment fund, for a 

direct or indirect fee borne by such 

investment fund, regardless of whether 

such transaction or service may 

otherwise be within the scope of relief 

provided by an administrative or 

statutory exemption. 

42. If granted, the exemption will 

terminate if Deutsche Bank or any of its 

affiliates are convicted of any additional 

crimes described in Section I(g) of PTE 

84–14, or if any of the other conditions 

of PTE 84–14 have not been met. Also, 

with limited exceptions, DB Group 

Services will not act as a fiduciary 

within the meaning of section 

3(21)(A)(i) or (iii) of ERISA, or section 

4975(e)(3)(A) and (C) of the Code, with 

respect to ERISA-covered plan and IRA 

assets, except DB Group Services may 

act as such a fiduciary with respect to 

employee benefit plans sponsored for its 

own employees or employees of an 

affiliate. 

43. The proposal requires each DB 

QPAM to update, implement and follow 

certain written policies and procedures 

(the Policies). These Policies are similar 

to the policies and procedures 

mandated by PTE 2017–04. In general 

terms, the Policies must require, and 

must be reasonably designed to ensure 

that, among other things: The asset 

management decisions of the DB 

QPAMs are conducted independently of 

the corporate management and business 

activities of DB Group Services; the DB 

QPAMs fully comply with ERISA’s 

fiduciary duties, as applicable, and with 

ERISA and the Code’s prohibited 

transaction provisions, as applicable; 

the DB QPAMs do not knowingly 

participate in any other person’s 

violation of ERISA or the Code with 

respect to Covered Plans; any filings or 

statements made by the DB QPAMs to 

regulators, on behalf of or in relation to 

Covered Plans, are materially accurate 

and complete; the DB QPAMs do not 

make material misrepresentations or 

omit material information in 

communications with such regulators 

with respect to Covered Plans; the DB 

QPAMs do not make material 

misrepresentations or omit material 

information in communications with 

Covered Plans; the DB QPAMs comply 

with the terms of the exemption; and 

any violation of, or failure to comply 

with any of these items, is corrected as 

soon as reasonably possible upon 

discovery, or as soon after the DB 

QPAM reasonably should have known 

of the noncompliance (whichever is 

earlier). Any such violation or 

compliance failure not so corrected 

must be reported, upon the discovery of 

such failure to so correct, in writing, to 

appropriate corporate officers, the head 

of compliance and the QPAM’s general 

counsel (or their functional equivalent), 

and the independent auditor 

responsible for reviewing compliance 

with the Policies. 

44. This proposal mandates training 

(Training), which is similar to the 

training required under PTE 2017–04. In 

this regard, all relevant DB QPAM asset/ 

portfolio management, trading, legal, 

compliance, and internal audit 

personnel must be trained during the 

Exemption Period. Among other things, 

the Training must, at a minimum, cover 

the Policies, ERISA and Code 

compliance, ethical conduct, the 

consequences for not complying with 

the conditions of this exemption 

(including any loss of exemptive relief 

provided herein), and the requirement 

for prompt reporting of wrongdoing. 

The Training must be conducted by a 

professional who has been prudently 

selected and who has appropriate 

technical training and proficiency with 

ERISA and the Code. 

45. Under this proposal, as in PTE 

2017–04, each DB QPAM must submit 

to an annual audit conducted by an 

independent auditor. Among other 

things, the auditor must test a sample of 

each DB QPAM’s transactions involving 

Covered Plans, sufficient in size and 

nature to afford the auditor a reasonable 

basis to determine such QPAM’s 

operational compliance with the 

Policies and Training. The auditor’s 

conclusions cannot be based solely on 

the Exemption Report created by the 

Compliance Officer, described below, in 

lieu of independent determinations and 

testing performed by the auditor. 

46. The Audit Report must be 

certified by the respective DB QPAM’s 

general counsel or one of the three most 

senior executive officers of the DB 

QPAM to which the Audit Report 

applies. A copy of the Audit Report 

must be provided to the Audit 

Committee of Deutsche Bank’s 

Supervisory Board. A senior executive 

officer, who has a direct reporting line 

to Deutsche Bank’s highest ranking legal 

compliance officer, must review the 

Audit Report for each DB QPAM and 

must certify in writing, under penalty of 

perjury, that such officer has reviewed 

each Audit Report. Deutsche Bank must 

notify the Department in the event of a 

change in the committee to which the 

Audit Report will be provided. 

47. This proposal requires that, 

throughout the Exemption Period, with 

respect to any arrangement, agreement, 

or contract between a DB QPAM and a 

Covered Plan, the DB QPAM must agree 

and warrant: (i) To comply with ERISA 

and the Code, as applicable with respect 

to such Covered Plan; and (ii) to refrain 

from engaging in prohibited transactions 

that are not otherwise exempt (and to 

promptly correct any inadvertent 

prohibited transactions). The DB 

QPAMs must further agree and warrant 

to comply with the standards of 

prudence and loyalty set forth in section 

404 of ERISA with respect to each such 

ERISA-covered plan. Each DB QPAM 

must also agree and warrant to 

indemnify and hold harmless such 

Covered Plan for any actual losses 

resulting directly from any of the 

following: (a) A DB QPAM’s violation of 

ERISA’s fiduciary duties, as applicable, 

and/or the prohibited transaction 

provisions of ERISA and the Code, as 

applicable; (b) a breach of contract by 

the DB QPAM; or (c) any claim arising 

out of the failure of such DB QPAM to 

qualify for the exemptive relief provided 

by PTE 84–14 as a result of a violation 

of Section I(g) of PTE 84–14 other than 

the Conviction. This condition applies 

only to actual losses caused by the DB 

QPAM. The Department views actual 

losses arising from unwinding 

transactions with third parties, and from 

transitioning Covered Plan assets to 

third parties, to be ‘‘direct’’ results of 

violating the terms of this provision. 

48. This proposed exemption contains 

specific notice requirements. Each DB 

QPAM must provide a notice regarding 

the proposed three-year exemption, 

along with a separate summary 

describing the facts that led to the 

Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 9383 

19 In the event Applicant meets this disclosure 

requirement through Summary Policies, changes to 

the Policies do not result in a requirement of a new 

disclosure unless the Summary Policies are no 

longer accurate because of the changes. 

Conviction (the Summary), which have 

been submitted to the Department, and 

a prominently displayed statement (the 

Statement) that the Conviction results in 

a failure to meet a condition in PTE 84– 

14, to each sponsor and beneficial 

owner of a Covered Plan that entered 

into a written asset or investment 

management agreement with a DB 

QPAM, or the sponsor of an investment 

fund in any case where a DB QPAM acts 

as a sub-adviser to the investment fund 

in which such ERISA-covered plan and 

IRA invests. The notice, Summary and 

Statement must be provided prior to, or 

contemporaneously with, the client’s 

receipt of a written asset management 

agreement from the DB QPAM. The 

clients must receive a Federal Register 

copy of the notice of final three-year 

exemption within sixty (60) days of this 

exemption’s effective date. The notice 

may be delivered electronically 

(including by an email that has a link to 

this three-year exemption). 

49. The proposal requires that each 

DB QPAM maintain records necessary 

to demonstrate that the conditions of 

this exemption have been met, for six 

(6) years following the date of any 

transaction for which such DB QPAM 

relies upon the relief in the exemption. 

The proposal mandates that DB 

continue to designate a senior 

compliance officer (the Compliance 

Officer) who will be responsible for 

compliance with the Policies and 

Training requirements described herein. 

The Compliance Officer must conduct 

an exemption review (the Exemption 

Review) to determine the adequacy and 

effectiveness of the implementation of 

the Policies and Training. The 

Compliance Officer must be a 

professional with extensive relevant 

experience with a reporting line to the 

highest ranking corporate officer in 

charge of compliance for the applicable 

DB QPAM. At a minimum, the 

Exemption Review must include review 

of the following items: (i) Any 

compliance matter related to the 

Policies or Training that was identified 

by, or reported to, the Compliance 

Officer during the previous year; (ii) any 

material change in the relevant business 

activities of the DB QPAMs; and (iii) 

any change to ERISA, the Code, or 

regulations that may be applicable to the 

activities of the DB QPAMs. 

50. The Compliance Officer must 

prepare a written report (an Exemption 

Report) that summarizes his or her 

material activities during the Exemption 

Period and sets forth any instance of 

noncompliance discovered during the 

Exemption Period, and any related 

corrective action. In each Exemption 

Report, the Compliance Officer must 

certify in writing that to his or her 

knowledge the report is accurate and 

note whether the DB QPAMs have 

complied with the Policies and 

Training, and/or corrected (or are 

correcting) any instances of 

noncompliance. 

51. The Exemption Report must be 

provided to the appropriate corporate 

officers of Deutsche Bank and each DB 

QPAM to which such report relates and 

to the head of compliance and the 

QPAM’s general counsel (or their 

functional equivalent) of the relevant 

DB QPAM. The Exemption Report must 

be made unconditionally available to 

the independent auditor. The 

Exemption Review, including the 

Compliance Officer’s written Exemption 

Report, must be completed within three 

(3) months following the end of the 

period to which it relates. 

52. Deutsche Bank must also 

immediately disclose to the Department 

any deferred prosecution agreement or 

non-prosecution agreement with the 

U.S. Department of Justice, entered into 

by DB or any of its affiliates (as defined 

in Section VI(d) of PTE 84–14) in 

connection with conduct described in 

Section I(g) of PTE 84–14 or section 411 

of ERISA. Deutsche Bank must also 

immediately provide the Department 

with any information requested by the 

Department, as permitted by law, 

regarding the agreement and/or conduct 

and allegations that led to the 

agreement. 

53. The proposal mandates that, 

among other things, each DB QPAM 

clearly and prominently inform Covered 

Plan clients of their right to obtain a 

copy of the Policies or a description 

(Summary Policies) which accurately 

summarizes key components of the DB 

QPAM’s written Policies developed in 

connection with this exemption. If the 

Policies are thereafter changed, each 

Covered Plan client must receive a new 

disclosure within six (6) months 

following the end of the calendar year 

during which the Policies were 

changed.19 With respect to this 

requirement, the description may be 

continuously maintained on a website, 

provided that such website link to the 

Policies or Summary Policies is clearly 

and prominently disclosed to each 

Covered Plan. 

54. The proposal requires that DB 

QPAMs must comply with each 

condition of PTE 84–14, as amended, 

with the sole exception of the violation 

of Section I(g) of PTE 84–14 that is 

attributable to the U.S. Conviction. If, 

during the Exemption Period, an entity 

within the Deutsche Bank corporate 

structure is convicted of a crime 

described in Section I(g) of PTE 84–14, 

(other than the U.S. Conviction), as 

referenced in Section I(g) of PTE 84–14, 

relief in this proposed exemption would 

terminate immediately. 

Department’s Notes: This proposed 

three-year exemption provides relief 

from certain of the restrictions set forth 

in sections 406 and 407 of ERISA. No 

relief or waiver of a violation of any 

other law is provided by the exemption. 

The relief in this proposed three-year 

exemption would terminate 

immediately if, among other things, an 

entity within the Deutsche Bank 

corporate structure is convicted of any 

crime covered by Section I(g) of PTE 84– 

14 (other than the U.S. Conviction) 

during the effective period of the 

proposed three-year exemption. While 

such an entity could apply for a new 

exemption in that circumstance, the 

Department is not obligated to grant a 

requested exemption. 

55. When interpreting and 

implementing this exemption, the 

Applicant and the DB QPAMs should 

resolve any ambiguities in light of the 

exemption’s protective purposes. To the 

extent additional clarification is 

necessary, these persons or entities 

should contact EBSA’s Office of 

Exemption Determinations, at 202–693– 

8540. 

Notice to Interested Persons 

Notice of the proposed exemption 

will be provided to all interested 

persons within seven days of the 

publication of the notice of proposed 

exemption in the Federal Register. The 

notice will contain a copy of the notice 

of proposed exemption, as published in 

the Federal Register, and a 

supplemental statement, as required 

pursuant to 29 CFR 2570.43(a)(2). The 

supplemental statement will inform 

interested persons of their right to 

comment on the pending exemption. All 

Written comments are due within thirty 

seven (37) days of the publication of the 

notice of proposed exemption in the 

Federal Register. All comments will be 

made available to the public. 

Warning: If you submit a comment, 

EBSA recommends that you include 

your name and other contact 

information in the body of your 

comment, but DO NOT submit 

information that you consider to be 

confidential, or otherwise protected 

(such as Social Security number or an 

unlisted phone number) or confidential 

business information that you do not 

want publicly disclosed. All comments 

9384 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 

20For purposes of this proposed five-year 

exemption, references to section 406 of Title I of the 

Act, unless otherwise specified, should be read to 

refer as well to the corresponding provisions of 

section 4975 of the Code. 

21 49 FR 9494 (March 13, 1984), as corrected at 

50 FR 41430, (October 10, 1985), as amended at 70 

FR 49305 (August 23, 2005), and as amended at 75 

FR 38837 (July 6, 2010). 

22Section I(g) of PTE 84–14 generally provides 

relief only if ‘‘[n]either the QPAM nor any affiliate 

thereof . . . nor any owner . . . of a 5 percent or 

more interest in the QPAM is a person who within 

the 10 years immediately preceding the transaction 

has been either convicted or released from 

imprisonment, whichever is later, as a result of’’ 

certain felonies including fraud. 

may be posted on the internet and can 

be retrieved by most internet search 

engines. 

General Information 

The attention of interested persons is 

directed to the following: 

(1) The fact that a transaction is the 

subject of an exemption under section 

408(a) of the Act and/or section 

4975(c)(2) of the Code does not relieve 

a fiduciary or other party in interest or 

disqualified person from certain other 

provisions of the Act and/or the Code, 

including any prohibited transaction 

provisions to which the exemption does 

not apply and the general fiduciary 

responsibility provisions of section 404 

of the Act, which, among other things, 

require a fiduciary to discharge his 

duties respecting the plan solely in the 

interest of the participants and 

beneficiaries of the plan and in a 

prudent fashion in accordance with 

section 404(a)(1)(b) of the Act; nor does 

it affect the requirement of section 

401(a) of the Code that the plan must 

operate for the exclusive benefit of the 

employees of the employer maintaining 

the plan and their beneficiaries; 

(2) Before an exemption may be 

granted under section 408(a) of the Act 

and/or section 4975(c)(2) of the Code, 

the Department must find that the 

exemption is administratively feasible, 

in the interests of the plan and of its 

participants and beneficiaries, and 

protective of the rights of participants 

and beneficiaries of the plan; 

(3) The proposed exemption, if 

granted, will be supplemental to, and 

not in derogation of, any other 

provisions of the Act and/or the Code, 

including statutory or administrative 

exemptions and transitional rules. 

Furthermore, the fact that a transaction 

is subject to an administrative or 

statutory exemption is not dispositive of 

whether the transaction is in fact a 

prohibited transaction; and 

(4) The proposed exemption, if 

granted, will be subject to the express 

condition that the material facts and 

representations contained in each 

application are true and complete, and 

that each application accurately 

describes all material terms of the 

transaction which is the subject of the 

exemption. 

Proposed Exemption 

The Department is considering 

granting a five-year exemption under 

the authority of section 408(a) of the Act 

(or ERISA) and section 4975(c)(2) of the 

Internal Revenue Code (or Code), and in 

accordance with the procedures set 

forth in 29 CFR part 2570, subpart B (76 

FR 66637, 66644, October 27, 2011).20

Effective December 31, 1978, section 

102 of Reorganization Plan No. 4 of 

1978, 5 U.S.C. App. 1 (1996), transferred 

the authority of the Secretary of the 

Treasury to issue exemptions of the type 

requested to the Secretary of Labor. 

Therefore, this notice of proposed 

exemption is issued solely by the 

Department. 

Section I. Covered Transactions 

The DB QPAMs, as further defined in 

Section II(c), will not be precluded from 

relying on the exemptive relief provided 

by Prohibited Transaction Exemption 

84–14 (PTE 84–14),21 notwithstanding 

the ‘‘U.S. Conviction’’ against DB Group 

Services (as further defined in Section 

II(a)), during the Exemption Period, 

provided that the following conditions 

are satisfied: 22

(a) The DB QPAMs (including their 

officers, directors, agents other than 

Deutsche Bank, and employees of such 

QPAMs) did not know of, have reason 

to know of, or participate in the 

criminal conduct of DB Group Services 

that is the subject of the U.S. 

Conviction. For purposes of this 

exemption, ‘‘participate in’’ or 

‘‘participated in’’ refers not only to 

active participation in the criminal 

conduct that is the subject of the U.S. 

Conviction, but also to knowing 

approval of the criminal conduct that is 

the subject of the U.S. Conviction, or 

knowledge of the conduct without 

taking active steps to prohibit the 

conduct, including reporting the 

conduct to the individual’s supervisors, 

and to the Board of Directors; 

(b) The DB QPAMs (including their 

officers, directors, agents other than 

Deutsche Bank, and employees of such 

QPAMs) did not receive direct 

compensation, or knowingly receive 

indirect compensation, in connection 

with the criminal conduct that is the 

subject of the U.S. Conviction. 

(c) The DB QPAMs do not currently 

and will not in the future employ or 

knowingly engage any of the individuals 

that ‘‘participated in’’ the criminal 

conduct that is the subject of the U.S. 

Conviction; 

(d) At all times during the Exemption 

Period, no DB QPAM will use its 

authority or influence to direct an 

‘‘investment fund’’ (as defined in 

Section VI(b) of PTE 84–14) that is 

subject to ERISA or the Code and 

managed by such DB QPAM with 

respect to one or more Covered Plan (as 

defined in Section II(b), to enter into 

any transaction with DB Group Services, 

or to engage DB Group Services to 

provide any service to such investment 

fund, for a direct or indirect fee borne 

by such investment fund, regardless of 

whether such transaction, or service, 

may otherwise be within the scope of 

relief provided by an administrative or 

statutory exemption; 

(e) Any failure of the DB QPAMs to 

satisfy Section I(g) of PTE 84–14 arose 

solely from the U.S. Conviction; 

(f) A DB QPAM did not exercise 

authority over the assets of any plan 

subject to Part 4 of Title I of ERISA (an 

ERISA-covered plan) or section 4975 of 

the Code (an IRA) in a manner that it 

knew, or should have known, would: 

Further the criminal conduct that is the 

subject of the U.S. Conviction; or cause 

the DB QPAM or its affiliates to directly, 

or indirectly, profit from the criminal 

conduct that is the subject of the U.S. 

Conviction; 

(g) Other than with respect to 

employee benefit plans maintained or 

sponsored for its own employees or the 

employees of an affiliate, DB Group 

Services will not act as a fiduciary 

within the meaning of section 

3(21)(A)(i) or (iii) of ERISA, or section 

4975(e)(3)(A) and (C) of the Code, with 

respect to ERISA-covered plan and IRA 

assets; provided, however, DB Group 

Services will not be treated as violating 

the conditions of this exemption solely 

because it acted as an investment advice 

fiduciary within the meaning of section 

3(21)(A)(ii) of ERISA, or section 

4975(e)(3)(B) of the Code, or because DB 

Group Services employees may be 

double-hatted, seconded, supervised or 

otherwise subject to the control of a DB 

QPAM, including in a discretionary 

fiduciary capacity with respect to the 

DB QPAM clients; 

(h)(1) Each DB QPAM must continue 

to maintain, adjust (to the extent 

necessary), implement and follow 

written policies and procedures (the 

Policies). The Policies must require, and 

must be reasonably designed to ensure 

that: 

(i) The asset management decisions of 

the DB QPAM are conducted 

independently of the corporate 

management and business activities of 

DB Group Services; 

Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 9385 

(ii) The DB QPAM fully complies 

with ERISA’s fiduciary duties and with 

ERISA and the Code’s prohibited 

transaction provisions, in each such 

case as applicable with respect to each 

Covered Plan, and does not knowingly 

participate in any violation of these 

duties and provisions with respect to 

Covered Plans; 

(iii) The DB QPAM does not 

knowingly participate in any other 

person’s violation of ERISA or the Code 

with respect to Covered Plans; 

(iv) Any filings or statements made by 

the DB QPAM to regulators, including, 

but not limited to, the Department, the 

Department of the Treasury, the 

Department of Justice, and the Pension 

Benefit Guaranty Corporation, on behalf 

of or in relation to Covered Plans, are 

materially accurate and complete, to the 

best of such QPAM’s knowledge at that 

time; 

(v) To the best of the DB QPAM’s 

knowledge at the time, the DB QPAM 

does not make material 

misrepresentations or omit material 

information in its communications with 

such regulators with respect to Covered 

Plans, or make material 

misrepresentations or omit material 

information in its communications with 

Covered Plans; 

(vi) The DB QPAM complies with the 

terms of this exemption; and 

(2) Any violation of, or failure to 

comply with an item in subparagraphs 

(h)(1)(ii) through (h)(1)(vi), is corrected 

as soon as reasonably possible upon 

discovery, or as soon after the QPAM 

reasonably should have known of the 

noncompliance (whichever is earlier), 

and any such violation or compliance 

failure not so corrected is reported, 

upon the discovery of such failure to so 

correct, in writing, to the head of 

compliance and the DB QPAM’s general 

counsel (or their functional equivalent) 

of the relevant DB QPAM that engaged 

in the violation or failure, and the 

independent auditor responsible for 

reviewing compliance with the Policies. 

A DB QPAM will not be treated as 

having failed to develop, implement, 

maintain, or follow the Policies, 

provided that it corrects any instance of 

noncompliance as soon as reasonably 

possible upon discovery, or as soon as 

reasonably possible after the QPAM 

reasonably should have known of the 

noncompliance (whichever is earlier), 

and provided that it adheres to the 

reporting requirements set forth in this 

subparagraph (2); 

(3) Each DB QPAM must maintain, 

adjust (to the extent necessary) and 

implement a program of training (the 

Training), to be conducted at least 

annually, for all relevant DB QPAM 

asset/portfolio management, trading, 

legal, compliance, and internal audit 

personnel. The Training must: 

(i) At a minimum, cover the Policies, 

ERISA and Code compliance (including 

applicable fiduciary duties and the 

prohibited transaction provisions), 

ethical conduct, the consequences for 

not complying with the conditions of 

this exemption (including any loss of 

exemptive relief provided herein), and 

prompt reporting of wrongdoing; and 

(ii) Be conducted by a professional 

who has been prudently selected and 

who has appropriate technical training 

and proficiency with ERISA and the 

Code; and 

(iii) Be conducted in-person, 

electronically or via a website; 

(i)(1) Each DB QPAM submits to three 

audits conducted annually by an 

independent auditor, who has been 

prudently selected and who has 

appropriate technical training and 

proficiency with ERISA and the Code, to 

evaluate the adequacy of, and each DB 

QPAM’s compliance with, the Policies 

and Training described herein. The 

audit requirement must be incorporated 

in the Policies. The first audit must 

cover a 12 month period that begins on 

April 18, 2021 and ends on April 17, 

2022. The second and third audits must 

cover the 12 month period that begins 

on April 18, 2022, and April 18, 2023, 

respectively. Each of the three annual 

audits must be completed no later than 

six (6) months after the corresponding 

audit’s ending period; 

(2) Within the scope of the audit and 

to the extent necessary for the auditor, 

in its sole opinion, to complete its audit 

and comply with the conditions 

described herein, and only to the extent 

such disclosure is not prevented by state 

or federal statute, or involves 

communications subject to attorneyclient privilege, each DB QPAM and, if 

applicable, Deutsche Bank, will grant 

the auditor unconditional access to its 

business, including, but not limited to: 

Its computer systems; business records; 

transactional data; workplace locations; 

Training materials; and personnel. Such 

access is limited to information relevant 

to the auditor’s objectives, as specified 

by the terms of this exemption; 

(3) The auditor’s engagement must 

specifically require the auditor to 

determine whether each DB QPAM has 

developed, implemented, maintained, 

and followed the Policies in accordance 

with the conditions of this exemption, 

and has developed and implemented 

the Training, as required herein; 

(4) The auditor’s engagement must 

specifically require the auditor to test 

each DB QPAM’s operational 

compliance with the Policies and 

Training. In this regard, the auditor 

must test, for each QPAM, a sample of 

such QPAM’s transactions involving 

Covered Plans, sufficient in size and 

nature to afford the auditor a reasonable 

basis to determine such QPAM’s 

operational compliance with the 

Policies and Training; 

(5) For each audit, on or before the 

end of the relevant period described in 

Section I(i)(1) for completing the audit, 

the auditor must issue a written report 

(the Audit Report) to Deutsche Bank, 

and the DB QPAM to which the audit 

applies that describes the procedures 

performed by the auditor in connection 

with its examination. The auditor, at its 

discretion, may issue a single 

consolidated Audit Report that covers 

all the DB QPAMs. The Audit Report 

must include the auditor’s specific 

determinations regarding: 

(i) The adequacy of each DB QPAM’s 

Policies and Training; each DB QPAM’s 

compliance with the Policies and 

Training; the need, if any, to strengthen 

such Policies and Training; and any 

instance of the respective DB QPAM’s 

noncompliance with the written 

Policies and Training described above. 

The DB QPAM must promptly address 

any noncompliance. The DB QPAM 

must promptly address or prepare a 

written plan of action to address any 

determination as to the adequacy of the 

Policies and Training and the auditor’s 

recommendations (if any) with respect 

to strengthening the Policies and 

Training of the respective QPAM. Any 

action taken or the plan of action to be 

taken by the DB QPAM must be 

included in an addendum to the Audit 

Report (such addendum must be 

completed prior to the certification 

described in Section I(i)(7) below). In 

the event such a plan of action to 

address the auditor’s recommendation 

regarding the adequacy of the Policies 

and Training is not completed by the 

time of submission of the Audit Report, 

the following period’s Audit Report 

must state whether the plan was 

satisfactorily completed. Any 

determination by the auditor that the 

respective DB QPAM has implemented, 

maintained, and followed sufficient 

Policies and Training must not be based 

solely or in substantial part on an 

absence of evidence indicating 

noncompliance. In this last regard, any 

finding that a DB QPAM has complied 

with the requirements under this 

subparagraph must be based on 

evidence that the particular DB QPAM 

has actually implemented, maintained, 

and followed the Policies and Training 

required by this exemption. 

Furthermore, the auditor must not 

solely rely on the Exemption Report 

9386 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 

created by the compliance officer (the 

Compliance Officer), as described in 

Section I(m) below as the basis for the 

auditor’s conclusions in lieu of 

independent determinations and testing 

performed by the auditor as required by 

Section I(i)(3) and (4) above; 

(ii) The adequacy of the most recent 

Exemption Review described in Section 

I(m); 

(6) The auditor must notify the 

respective DB QPAM of any instance of 

noncompliance identified by the auditor 

within five (5) business days after such 

noncompliance is identified by the 

auditor, regardless of whether the audit 

has been completed as of that date; 

(7) With respect to each Audit Report, 

the DB QPAM’s general counsel, or one 

of the three most senior executive 

officers of the line of business engaged 

in discretionary asset management 

services through the DB QPAM with 

respect to which the Audit Report 

applies, must certify in writing, under 

penalty of perjury, that the officer has 

reviewed the Audit Report and this 

exemption; that, to the best of such 

officer’s knowledge at the time, the such 

DB QPAM has addressed, corrected, 

remedied any noncompliance and 

inadequacy or has an appropriate 

written plan to address any inadequacy 

regarding the Policies and Training 

identified in the Audit Report. Such 

certification must also include the 

signatory’s determination that, to the 

best of such officer’s knowledge at the 

time, the Policies and Training in effect 

at the time of signing are adequate to 

ensure compliance with the conditions 

of this exemption, and with the 

applicable provisions of ERISA and the 

Code; 

(8) The Audit Committee of Deutsche 

Bank’s Supervisory Board is provided a 

copy of each Audit Report; and a senior 

executive officer with a direct reporting 

line to the highest ranking legal 

compliance officer of Deutsche Bank 

must review the Audit Report for each 

DB QPAM and must certify in writing, 

under penalty of perjury, that such 

officer has reviewed each Audit Report. 

Deutsche Bank must provide notice to 

the Department in the event of a switch 

in the committee to which the Audit 

Report will be provided; 

(9) Each DB QPAM provides its 

certified Audit Report, by regular mail 

to: Office of Exemption Determinations 

(OED), 200 Constitution Avenue NW, 

Suite 400, Washington, DC 20210; or by 

private carrier to: 122 C Street NW, 

Suite 400, Washington, DC 20001–2109. 

This delivery must take place no later 

than forty-five (45) days following 

completion of the Audit Report. The 

Audit Report will be made part of the 

public record regarding this exemption. 

Furthermore, each DB QPAM must 

make its Audit Report unconditionally 

available, electronically or otherwise, 

for examination upon request by any 

duly authorized employee or 

representative of the Department, other 

relevant regulators, and any fiduciary of 

a Covered Plan; 

(10) Any engagement agreement with 

an auditor to perform the audit required 

by this exemption must be submitted to 

OED no later than two months after the 

execution of such agreement; 

(11) The auditor must provide the 

Department, upon request, for 

inspection and review, access to all the 

workpapers created and used in 

connection with the audit, provided 

such access and inspection is otherwise 

permitted by law; and 

(12) Deutsche Bank must notify the 

Department of a change in the 

independent auditor no later than two 

(2) months after the engagement of a 

substitute or subsequent auditor and 

must provide an accurate explanation of 

the basis for the substitution or change 

including an accurate description of any 

material disputes between the 

terminated auditor and Deutsche Bank 

or any of its affiliates; 

(j) As of April 18, 2021, with respect 

to any arrangement, agreement, or 

contract between a DB QPAM and a 

Covered Plan, the DB QPAM agrees and 

warrants to Covered Plans: 

(1) To comply with ERISA and the 

Code, as applicable with respect to such 

Covered Plan; to refrain from engaging 

in prohibited transactions that are not 

otherwise exempt (and to promptly 

correct any inadvertent prohibited 

transactions); and to comply with the 

standards of prudence and loyalty set 

forth in section 404 of ERISA, with 

respect to each such ERISA-covered 

plan and IRA to the extent that section 

404 is applicable; 

(2) To indemnify and hold harmless 

the Covered Plan for any actual losses 

resulting directly from a DB QPAM’s 

violation of ERISA’s fiduciary duties, as 

applicable, and of the prohibited 

transaction provisions of ERISA and the 

Code, as applicable; a breach of contract 

by the QPAM; or any claim arising out 

of the failure of such DB QPAM to 

qualify for the exemptive relief provided 

by PTE 84–14 as a result of a violation 

of Section I(g) of PTE 84–14 other than 

the U.S. Conviction. This condition 

applies only to actual losses caused by 

the DB QPAM’s violations. 

(3) Not to require (or otherwise cause) 

the Covered Plan to waive, limit, or 

qualify the liability of the DB QPAM for 

violating ERISA or the Code or engaging 

in prohibited transactions; 

(4) Not to restrict the ability of such 

Covered Plan to terminate or withdraw 

from its arrangement with the DB 

QPAM with respect to any investment 

in a separately managed account or 

pooled fund subject to ERISA and 

managed by such QPAM, with the 

exception of reasonable restrictions, 

appropriately disclosed in advance, that 

are specifically designed to ensure 

equitable treatment of all investors in a 

pooled fund in the event such 

withdrawal or termination may have 

adverse consequences for all other 

investors. In connection with any such 

arrangements involving investments in 

pooled funds subject to ERISA entered 

into after the effective date of PTE 2017– 

04, the adverse consequences must 

relate to a lack of liquidity of the 

underlying assets, valuation issues, or 

regulatory reasons that prevent the fund 

from promptly redeeming an ERISAcovered plan’s or IRA’s investment, and 

such restrictions must be applicable to 

all such investors and effective no 

longer than reasonably necessary to 

avoid the adverse consequences; 

(5) Not to impose any fees, penalties, 

or charges for such termination or 

withdrawal with the exception of 

reasonable fees, appropriately disclosed 

in advance, that are specifically 

designed to prevent generally 

recognized abusive investment practices 

or specifically designed to ensure 

equitable treatment of all investors in a 

pooled fund in the event such 

withdrawal or termination may have 

adverse consequences for all other 

investors, provided that such fees are 

applied consistently and in like manner 

to all such investors; and 

(6) Not to include exculpatory 

provisions disclaiming or otherwise 

limiting liability of the DB QPAM for a 

violation of such agreement’s terms. To 

the extent consistent with Section 410 

of ERISA, however, this provision does 

not prohibit disclaimers for liability 

caused by an error, misrepresentation, 

or misconduct of a plan fiduciary or 

other party hired by the plan fiduciary 

who is independent of Deutsche Bank, 

and its affiliates, or damages arising 

from acts outside the control of the DB 

QPAM; and 

(7) By August 18, 2021, each DB 

QPAM must provide a notice of its 

obligations under this Section I(j) to 

each Covered Plan. For Covered Plans 

that enter into a written asset or 

investment management agreement with 

a DB QPAM on or after April 18, 2021, 

the DB QPAM must agree to its 

obligations under this section I(j) in an 

updated investment management 

agreement between the DB QPAM and 

such clients or other written contractual 

Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 9387 

23 In the event the Applicant meets this disclosure 

requirement through Summary Policies, changes to 

the Policies shall not result in the requirement for 

Continued 

agreement. Notwithstanding the above, 

a DB QPAM will not violate the 

condition solely because a Covered Plan 

or IRA refuses to sign an updated 

investment management agreement. 

This condition will be deemed met for 

each Covered Plan that received notice 

pursuant to PTE 2017–04 that meets the 

terms of this condition. 

(k) Each DB QPAM provides a notice 

regarding the proposed exemption, 

along with a separate summary 

describing the facts that led to the U.S. 

Conviction (the Summary), which have 

been submitted to the Department, and 

a prominently displayed statement (the 

Statement) that the U.S. Conviction 

results in a failure to meet a condition 

in PTE 84–14, to each sponsor and 

beneficial owner of a Covered Plan that 

entered into a written asset or 

investment management agreement with 

a DB QPAM, or the sponsor of an 

investment fund in any case where a DB 

QPAM acts as a sub-adviser to the 

investment fund in which such ERISAcovered plan and IRA invests. The 

notice, Summary and Statement must be 

provided prior to, or 

contemporaneously with, the client’s 

receipt of a written asset management 

agreement from the DB QPAM. The 

clients must receive a Federal Register 

copy of the notice of final exemption 

within sixty (60) days of this 

exemption’s effective date. The notice 

may be delivered electronically 

(including by an email that has a link to 

this exemption); 

(l) The DB QPAMs must comply with 

each condition of PTE 84–14, as 

amended, with the sole exception of the 

violation of Section I(g) of PTE 84–14 

that is attributable to the U.S. 

Conviction; 

(m)(1) Deutsche Bank continues to 

designate a senior compliance officer 

(the Compliance Officer) who will be 

responsible for compliance with the 

Policies and Training requirements 

described herein. The Compliance 

Officer must conduct an annual review 

for each twelve month period, beginning 

on April 18, 2021, (the Exemption 

Review) to determine the adequacy and 

effectiveness of the implementation of 

the Policies and Training. With respect 

to the Compliance Officer, the following 

conditions must be met: 

(i) The Compliance Officer must be a 

professional who has extensive 

experience with, and knowledge of, the 

regulation of financial services and 

products, including under ERISA and 

the Code; and 

(ii) The Compliance Officer must have 

a direct reporting line to the highest 

ranking corporate officer in charge of 

legal compliance for asset management; 

(2) With respect to each Exemption 

Review, the following conditions must 

be met: 

(i) The Exemption Review includes a 

review of the DB QPAM’s compliance 

with and effectiveness of the Policies 

and Training and of the following: Any 

compliance matter related to the 

Policies or Training that was identified 

by, or reported to, the Compliance 

Officer or others within the compliance 

and risk control function (or its 

equivalent) during the previous year; 

the most recent Audit Report issued 

pursuant to this exemption or PTE 

2017–04; any material change in the 

relevant business activities of the DB 

QPAMs; and any change to ERISA, the 

Code, or regulations related to fiduciary 

duties and the prohibited transaction 

provisions that may be applicable to the 

activities of the DB QPAMs; 

(ii) The Compliance Officer prepares 

a written report for each Exemption 

Review (each, an Exemption Report) 

that (A) summarizes his or her material 

activities during the preceding year; (B) 

sets forth any instance of 

noncompliance discovered during the 

preceding year, and any related 

corrective action; (C) details any change 

to the Policies or Training to guard 

against any similar instance of 

noncompliance occurring again; and (D) 

makes recommendations, as necessary, 

for additional training, procedures, 

monitoring, or additional and/or 

changed processes or systems, and 

management’s actions on such 

recommendations; 

(iii) In each Exemption Report, the 

Compliance Officer must certify in 

writing that to the best of his or her 

knowledge at the time: (A) The report is 

accurate; (B) the Policies and Training 

are working in a manner which is 

reasonably designed to ensure that the 

Policies and Training requirements 

described herein are met; (C) any known 

instance of noncompliance during the 

preceding year and any related 

correction taken to date have been 

identified in the Exemption Report; and 

(D) the DB QPAMs have complied with 

the Policies and Training, and/or 

corrected (or are correcting) any known 

instances of noncompliance in 

accordance with Section I(h) above; 

(iv) Each Exemption Report must be 

provided to appropriate corporate 

officers of Deutsche Bank and to each 

DB QPAM to which such report relates, 

and to the head of compliance and the 

DB QPAM’s general counsel (or their 

functional equivalent) of the relevant 

DB QPAM; and the Exemption Report 

must be made unconditionally available 

to the independent auditor described in 

Section I(i) above; 

(v) Each Exemption Review, including 

the Compliance Officer’s written 

Exemption Report, must be completed 

within three (3) months following the 

end of the period to which it relates. 

The Exemption Review for the period 

April 18, 2020 through April 17, 2021 

must be conducted, and completed, 

under the requirements of PTE 2017–04; 

(n) In connection with the deferred 

prosecution agreement entered on 

January 8, 2021, between Deutsche Bank 

and the U.S. Department of Justice, to 

resolve the U.S. government’s 

investigation into violations of the 

Foreign Corrupt Practices Act and a 

separate investigation into a 

commodities fraud scheme, no DB 

QPAMs were involved in the conduct 

that gave rise to the deferred 

prosecution agreement, and no Covered 

Plan assets were involved in the 

transactions that gave rise to the 

deferred prosecution agreement; 

(o) Each DB QPAM will maintain 

records necessary to demonstrate that 

the conditions of this exemption have 

been met for six (6) years following the 

date of any transaction for which the DB 

QPAM relies upon the relief in the 

exemption; 

(p) During the Exemption Period, 

Deutsche Bank: (1) Immediately 

discloses to the Department any 

Deferred Prosecution Agreement or a 

Non-Prosecution Agreement with the 

U.S. Department of Justice entered into 

by Deutsche Bank or any of its affiliates 

(as defined in Section VI(d) of PTE 84– 

14) in connection with conduct 

described in Section I(g) of PTE 84–14 

or section 411 of ERISA; and (2) 

immediately provides the Department 

any information requested by the 

Department, as permitted by law, 

regarding the agreement and/or conduct 

and allegations that led to the 

agreement; 

(q) Each DB QPAM, in its agreements 

with, or in other written disclosures 

provided to Covered Plans, clearly and 

prominently informs Covered Plan 

clients of their right to obtain a copy of 

the Policies or a description (Summary 

Policies) which accurately summarizes 

key components of the DB QPAM’s 

written Policies developed in 

connection with this exemption. If the 

Policies are thereafter changed, each 

Covered Plan client must receive a new 

disclosure within six (6) months 

following the end of the calendar year 

during which the Policies were 

changed.23 With respect to this 

9388 Federal Register / Vol. 86, No. 28 / Friday, February 12, 2021 / Notices 

a new disclosure unless, as a result of changes to 

the Policies, the Summary Policies are no longer 

accurate. 

24 In general terms, a QPAM is an independent 

fiduciary that is a bank, savings and loan 

association, insurance company, or investment 

adviser that meets certain equity or net worth 

requirements and other licensure requirements and 

that has acknowledged in a written management 

agreement that it is a fiduciary with respect to each 

plan that has retained the QPAM. 

requirement, the description may be 

continuously maintained on a website, 

provided that such website links to the 

Policies or Summary Policies is clearly 

and prominently disclosed to each 

Covered Plan; and 

(r) A DB QPAM will not fail to meet 

the terms of this exemption solely 

because a different DB QPAM fails to 

satisfy a condition for relief described in 

Sections I(c), (d), (h), (i), (j), (k), (l), (o) 

and (q) or, if the independent auditor 

described in Section I(i) fails a provision 

of the exemption other than the 

requirement described in Section 

I(i)(11), provided that such failure did 

not result from any actions or inactions 

of Deutsche Bank or its affiliates. 

Section II. Definitions 

(a) The term ‘‘U.S. Conviction’’ means 

the judgment of conviction against DB 

Group Services UK Limited (DB Group 

Services), entered on April 18, 2017, by 

the United States District Court for the 

District of Connecticut, in case number 

3:15–cr–00062–RNC, for one (1) count 

of wire fraud, in violation of 18 U.S.C. 

1343. For all purposes under this 

exemption, ‘‘conduct’’ of any person or 

entity that is the ‘‘subject of [a] 

Conviction’’ encompasses the factual 

allegations described in Paragraph 13 of 

the Plea Agreement filed in the District 

Court in case number 3:15–cr–00062– 

RNC. 

(b) The term ‘‘Covered Plan’’ means a 

plan subject to Part 4 of Title I of ERISA 

(an ‘‘ERISA-covered plan’’) or a plan 

subject to section 4975 of the Code (an 

‘‘IRA’’), in each case, with respect to 

which a DB QPAM relies on PTE 84–14, 

or with respect to which a DB QPAM (or 

any Deutsche Bank affiliate) has 

expressly represented that the manager 

qualifies as a QPAM or relies on PTE 

84–14. A Covered Plan does not include 

an ERISA-covered plan or IRA to the 

extent the DB QPAM has expressly 

disclaimed reliance on QPAM status or 

PTE 84–14 in entering into a contract, 

arrangement, or agreement with the 

ERISA-covered plan or IRA. 

(c) The term ‘‘DB QPAM’’ or ‘‘DB 

QPAMs’’ means DWS Investment 

Management Americas, Inc., and any 

certain current, and future, Deutsche 

Bank’s asset management affiliates that 

qualify as a ‘‘qualified professional asset 

manager’’ (as defined in Section VI(a) of 

PTE 84–14),24 and that rely on the relief 

provided by PTE 84–14, and with 

respect to which Deutsche Bank is an 

‘‘affiliate’’ (as defined in section VI(d)(1) 

of PTE 84–14). The term ‘‘DB QPAM’’ 

excludes DB Group Services. 

(d) The term ‘‘Deutsche Bank’’ means 

Deutsche Bank AG, a publicly-held 

global banking and financial services 

company headquartered in Frankfurt, 

Germany; 

(e) The term ‘‘Exemption Period’’ 

means the three year period from April 

18, 2021 and ending on April 17, 2024; 

(f) The term ‘‘Plea Agreement’’ means 

the Plea Agreement entered into 

between DB Group Services and the 

U.S. Department of Justice, Fraud 

Section, Criminal Division, on April 23, 

2015 in connection with Case Number 

3:15–cr–00062–RNC filed in the U.S. 

District Court for the District of 

Connecticut, subsequently adjudged by 

the Court on March 28, 2017. 

Effective Date: This exemption will be 

in effect for three years, beginning on 

April 18, 2021. 

Signed at Washington, DC, this 8th day of 

February, 2021. 

Christopher Motta, 

Chief, Division of Individual Exemptions, 

Office of Exemption Determinations, 

Employee Benefits Security Administration, 

U.S. Department of Labor. 

[FR Doc. 2021–02886 Filed 2–11–21; 8:45 am] 

BILLING CODE 4510–29–P 

DEPARTMENT OF LABOR 

Office of the Secretary 

Agency Information Collection 

Activities; Submission for OMB 

Review; Comment Request; 

Department of Labor Events 

Management Platform 

ACTION: Notice of availability; request 

for comments. 

SUMMARY: The Department of Labor 

(DOL) is submitting this Office of the 

Secretary (OS)-sponsored information 

collection request (ICR) to the Office of 

Management and Budget (OMB) for 

review and approval in accordance with 

the Paperwork Reduction Act of 1995 

(PRA). Public comments on the ICR are 

invited. 

DATES: The OMB will consider all 

written comments that agency receives 

on or before March 15, 2021. 

ADDRESSES: Written comments and 

recommendations for the proposed 

information collection should be sent 

within 30 days of publication of this 

notice to www.reginfo.gov/public/do/ 

PRAMain. Find this particular 

information collection by selecting 

‘‘Currently under 30-day Review—Open 

for Public Comments’’ or by using the 

search function. 

Comments are invited on: (1) Whether 

the collection of information is 

necessary for the proper performance of 

the functions of the Department, 

including whether the information will 

have practical utility; (2) if the 

information will be processed and used 

in a timely manner; (3) the accuracy of 

the agency’s estimates of the burden and 

cost of the collection of information, 

including the validity of the 

methodology and assumptions used; (4) 

ways to enhance the quality, utility and 

clarity of the information collection; and 

(5) ways to minimize the burden of the 

collection of information on those who 

are to respond, including the use of 

automated collection techniques or 

other forms of information technology. 

FOR FURTHER INFORMATION CONTACT: 

Anthony May by telephone at 202–693– 

4129 (this is not a toll-free number) or 

by email at DOL_PRA_PUBLIC@dol.gov. 

SUPPLEMENTARY INFORMATION: The DOL 

Events Management Platform is a shared 

service that allows a DOL agency to 

collect registration information in a way 

that can be tailored to a particular event. 

As the information needed to register for 

specific events may vary, this ICR 

provides a generic format to obtain any 

required PRA authorization from the 

OMB. DOL notes that registration 

requirements for many events do not 

require PRA clearance, because the 

information requested is minimal (e.g. 

information necessary to identify the 

attendee, address). This information 

collection, however, is subject to the 

Paperwork Reduction Act (PRA). A 

Federal agency generally cannot 

conduct or sponsor a collection of 

information and the public is generally 

not required to respond to an 

information collection unless the OMB 

approves it for use and the agency 

displays a currently valid OMB Control 

Number. In addition, notwithstanding 

any other provisions of law, no person 

shall generally be subject to penalty for 

failing to comply with a collection of 

information that does not display a 

valid OMB Control Number. The DOL 

seeks PRA authorization for this 

information collection for three (3) 

years. OMB authorization for an 

information Collection Review cannot 

be for more than three (3) years without 

renewal. The DOL notes that currently 

approved information collection 

requirements submitted to the OMB 

receive a month-to-month extension