Page 429 TITLE 29—LABOR § 1102

pliance by such insurer with sections 1104, 1106,

and 1107 of this title with respect to those assets

of the insurer’s general account which support a

policy described in paragraph (3).

(5)(A) Subject to subparagraph (B), any regulations issued under paragraph (1) shall not take

effect before the date on which such regulations

become final.

(B) No person shall be subject to liability

under this part or section 4975 of title 26 for conduct which occurred before the date which is 18

months following the date described in subparagraph (A) on the basis of a claim that the assets

of an insurer (other than plan assets held in a

separate account) constitute assets of the plan,

except—

(i) as otherwise provided by the Secretary in

regulations intended to prevent avoidance of

the regulations issued under paragraph (1), or

(ii) as provided in an action brought by the

Secretary pursuant to paragraph (2) or (5) of

section 1132(a) of this title for a breach of fiduciary responsibilities which would also constitute a violation of Federal or State criminal law.

The Secretary shall bring a cause of action described in clause (ii) if a participant, beneficiary, or fiduciary demonstrates to the satisfaction of the Secretary that a breach described

in clause (ii) has occurred.

(6) Nothing in this subsection shall preclude

the application of any Federal criminal law.

(7) For purposes of this subsection, the term

‘‘policy’’ includes a contract.

(Pub. L. 93–406, title I, §401, Sept. 2, 1974, 88 Stat.

874; Pub. L. 101–239, title VII, §7891(a)(1), Dec. 19,

1989, 103 Stat. 2445; Pub. L. 104–188, title I,

§1460(a), Aug. 20, 1996, 110 Stat. 1820.)

REFERENCES IN TEXT

The Investment Company Act of 1940, referred to in

subsec. (b)(1), is title I of act Aug. 22, 1940, ch. 686, 54

Stat. 789, as amended, which is classified generally to

subchapter I (§80a–1 et seq.) of chapter 2D of Title 15,

Commerce and Trade. For complete classification of

this Act to the Code, see section 80a–51 of Title 15 and

Tables.

AMENDMENTS

1996—Subsec. (c). Pub. L. 104–188 added subsec. (c).

1989—Subsec. (a)(2). Pub. L. 101–239 substituted ‘‘Internal Revenue Code of 1986’’ for ‘‘Internal Revenue

Code of 1954’’, which for purposes of codification was

translated as ‘‘title 26’’ thus requiring no change in

text.

EFFECTIVE DATE OF 1996 AMENDMENT

Section 1460(b) of Pub. L. 104–188 provided that:

‘‘(1) IN GENERAL.—Except as provided in paragraph (2),

the amendment made by this section [amending this

section] shall take effect on January 1, 1975.

‘‘(2) CIVIL ACTIONS.—The amendment made by this

section shall not apply to any civil action commenced

before November 7, 1995.’’

EFFECTIVE DATE OF 1989 AMENDMENT

Amendment by Pub. L. 101–239 effective, except as

otherwise provided, as if included in the provision of

the Tax Reform Act of 1986, Pub. L. 99–514, to which

such amendment relates, see section 7891(f) of Pub. L.

101–239, set out as a note under section 1002 of this title.

PLAN AMENDMENTS NOT REQUIRED UNTIL

JANUARY 1, 1998

For provisions directing that if any amendments

made by subtitle D [§§1401–1465] of title I of Pub. L.

104–188 require an amendment to any plan or annuity

contract, such amendment shall not be required to be

made before the first day of the first plan year beginning on or after Jan. 1, 1998, see section 1465 of Pub. L.

104–188, set out as a note under section 401 of Title 26,

Internal Revenue Code.

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in section 1003 of this title;

title 26 section 4975.

§ 1102. Establishment of plan

(a) Named fiduciaries

(1) Every employee benefit plan shall be established and maintained pursuant to a written instrument. Such instrument shall provide for one

or more named fiduciaries who jointly or severally shall have authority to control and manage

the operation and administration of the plan.

(2) For purposes of this subchapter, the term

‘‘named fiduciary’’ means a fiduciary who is

named in the plan instrument, or who, pursuant

to a procedure specified in the plan, is identified

as a fiduciary (A) by a person who is an employer or employee organization with respect to

the plan or (B) by such an employer and such an

employee organization acting jointly.

(b) Requisite features of plan

Every employee benefit plan shall—

(1) provide a procedure for establishing and

carrying out a funding policy and method consistent with the objectives of the plan and the

requirements of this subchapter,

(2) describe any procedure under the plan for

the allocation of responsibilities for the operation and administration of the plan (including any procedures described in section

1105(c)(1) of this title),

(3) provide a procedure for amending such

plan, and for identifying the persons who have

authority to amend the plan, and

(4) specify the basis on which payments are

made to and from the plan.

(c) Optional features of plan

Any employee benefit plan may provide—

(1) that any person or group of persons may

serve in more than one fiduciary capacity with

respect to the plan (including service both as

trustee and administrator);

(2) that a named fiduciary, or a fiduciary

designated by a named fiduciary pursuant to a

plan procedure described in section 1105(c)(1)

of this title, may employ one or more persons

to render advice with regard to any responsibility such fiduciary has under the plan; or

(3) that a person who is a named fiduciary

with respect to control or management of the

assets of the plan may appoint an investment

manager or managers to manage (including

the power to acquire and dispose of) any assets

of a plan.

(Pub. L. 93–406, title I, §402, Sept. 2, 1974, 88 Stat.

875.)

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 1002, 1103, 1105,

1114 of this title.
§ 1103 TITLE 29—LABOR Page 430

§ 1103. Establishment of trust

(a) Benefit plan assets to be held in trust; authority of trustees

Except as provided in subsection (b) of this

section, all assets of an employee benefit plan

shall be held in trust by one or more trustees.

Such trustee or trustees shall be either named

in the trust instrument or in the plan instrument described in section 1102(a) of this title or

appointed by a person who is a named fiduciary,

and upon acceptance of being named or appointed, the trustee or trustees shall have exclusive authority and discretion to manage and

control the assets of the plan, except to the extent that—

(1) the plan expressly provides that the

trustee or trustees are subject to the direction

of a named fiduciary who is not a trustee, in

which case the trustees shall be subject to

proper directions of such fiduciary which are

made in accordance with the terms of the plan

and which are not contrary to this chapter, or

(2) authority to manage, acquire, or dispose

of assets of the plan is delegated to one or

more investment managers pursuant to section 1102(c)(3) of this title.

(b) Exceptions

The requirements of subsection (a) of this section shall not apply—

(1) to any assets of a plan which consist of

insurance contracts or policies issued by an

insurance company qualified to do business in

a State;

(2) to any assets of such an insurance company or any assets of a plan which are held by

such an insurance company;

(3) to a plan—

(A) some or all of the participants of which

are employees described in section 401(c)(1)

of title 26; or

(B) which consists of one or more individual retirement accounts described in section

408 of title 26;

to the extent that such plan’s assets are held

in one or more custodial accounts which qualify under section 401(f) or 408(h) of title 26,

whichever is applicable.

(4) to a plan which the Secretary exempts

from the requirement of subsection (a) of this

section and which is not subject to any of the

following provisions of this chapter—

(A) part 2 of this subtitle,

(B) part 3 of this subtitle, or

(C) subchapter III of this chapter; or

(5) to a contract established and maintained

under section 403(b) of title 26 to the extent

that the assets of the contract are held in one

or more custodial accounts pursuant to section 403(b)(7) of title 26.

(6) Any plan, fund or program under which

an employer, all of whose stock is directly or

indirectly owned by employees, former employees or their beneficiaries, proposes

through an unfunded arrangement to compensate retired employees for benefits which

were forfeited by such employees under a pension plan maintained by a former employer

prior to the date such pension plan became

subject to this chapter.

(c) Assets of plan not to inure to benefit of employer; allowable purposes of holding plan

assets

(1) Except as provided in paragraph (2), (3), or

(4) or subsection (d) of this section, or under sections 1342 and 1344 of this title (relating to termination of insured plans), or under section 420

of title 26 (as in effect on January 1, 1995), the

assets of a plan shall never inure to the benefit

of any employer and shall be held for the exclusive purposes of providing benefits to participants in the plan and their beneficiaries and defraying reasonable expenses of administering

the plan.

(2)(A) In the case of a contribution, or a payment of withdrawal liability under part 1 of subtitle E of subchapter III of this chapter—

(i) if such contribution or payment is made

by an employer to a plan (other than a multiemployer plan) by a mistake of fact, paragraph (1) shall not prohibit the return of such

contribution to the employer within one year

after the payment of the contribution, and

(ii) if such contribution or payment is made

by an employer to a multiemployer plan by a

mistake of fact or law (other than a mistake

relating to whether the plan is described in

section 401(a) of title 26 or the trust which is

part of such plan is exempt from taxation

under section 501(a) of title 26), paragraph (1)

shall not prohibit the return of such contribution or payment to the employer within 6

months after the plan administrator determines that the contribution was made by such

a mistake.

(B) If a contribution is conditioned on initial

qualification of the plan under section 401 or

403(a) of title 26, and if the plan receives an adverse determination with respect to its initial

qualification, then paragraph (1) shall not prohibit the return of such contribution to the employer within one year after such determination, but only if the application for the determination is made by the time prescribed by law

for filing the employer’s return for the taxable

year in which such plan was adopted, or such

later date as the Secretary of the Treasury may

prescribe.

(C) If a contribution is conditioned upon the

deductibility of the contribution under section

404 of title 26, then, to the extent the deduction

is disallowed, paragraph (1) shall not prohibit

the return to the employer of such contribution

(to the extent disallowed) within one year after

the disallowance of the deduction.

(3) In the case of a withdrawal liability payment which has been determined to be an overpayment, paragraph (1) shall not prohibit the return of such payment to the employer within 6

months after the date of such determination.

(d) Termination of plan

(1) Upon termination of a pension plan to

which section 1321 of this title does not apply at

the time of termination and to which this part

applies (other than a plan to which no employer

contributions have been made) the assets of the

plan shall be allocated in accordance with the

provisions of section 1344 of this title, except as

otherwise provided in regulations of the Secretary.