§ 1341a TITLE 29—LABOR Page 522

tion 4041(b)(2)(C)(i) of such Act (as so amended) for a period not to exceed 60 days.’’

SPECIAL TEMPORARY RULE FOR TERMINATION OF

SINGLE-EMPLOYER PLAN

Section 11008(d) of Pub. L. 99–272 provided that:

‘‘(1) REQUIREMENTS TO BE MET BEFORE FINAL DISTRIBUTION OF ASSETS.—In the case of the termination of a

single-employer plan described in paragraph (2) with respect to which the amount payable to the employer

pursuant to section 4044(d) [29 U.S.C. 1344(d)] exceeds

$1,000,000 (determined as of the proposed date of final

distribution of assets), the final distribution of assets

pursuant to such termination may not occur unless the

Pension Benefit Guaranty Corporation—

‘‘(A) determines that the assets of the plan are sufficient for benefit commitments (within the meaning

of section 4041(d)(1) of the Employee Retirement Income Security Act of 1974 (as amended by section

11007) [29 U.S.C. 1341(d)(1)]) under the plan, and

‘‘(B) issues to the plan administrator a written notice setting forth the determination described in subparagraph (A).

‘‘(2) PLANS TO WHICH SUBSECTION APPLIES.—A singleemployer plan is described in this paragraph if—

‘‘(A) the plan administrator has filed a notice of intent to terminate with the Pension Benefit Guaranty

Corporation, and—

‘‘(i) the filing was made before January 1, 1986,

and the Corporation has not issued a notice of sufficiency for such plan before the date of the enactment of this Act [Apr. 7, 1986], or

‘‘(ii) the filing is made on or after January 1, 1986,

and before 60 days after the date of the enactment

of this Act and the Corporation has not issued a notice of sufficiency for such plan before the date of

the enactment of this Act, and

‘‘(B) of the persons who are (as of the termination

date) participants in the plan, the lesser of 10 percent

or 200 have filed complaints with the Corporation regarding such termination—

‘‘(i) in the case of plans described in subparagraph

(A)(i), before 15 days after the date of the enactment of this Act, or

‘‘(ii) in any other case, before the later of 15 days

after the date of the enactment of this Act or 45

days after the date of the filing of such notice.

‘‘(3) CONSIDERATION OF COMPLAINTS.—The Corporation

shall consider and respond to such complaints not later

than 90 days after the date on which the Corporation

makes the determination described in paragraph (1)(A).

The Corporation may hold informal hearings to expedite consideration of such complaints. Any such hearing shall be exempt from the requirements of chapter 5

of title 5, United States Code.

‘‘(4) DELAY ON ISSUANCE OF NOTICE.—

‘‘(A) GENERAL RULE.—Except as provided in subparagraph (B), the Corporation shall not issue any

notice described in paragraph (1)(B) until 90 days

after the date on which the Corporation makes the

determination described in paragraph (1)(A).

‘‘(B) EXCEPTION IN CASES OF SUBSTANTIAL BUSINESS

HARDSHIP.—Except in the case of an acquisition, takeover, or leveraged buyout, the preceding provisions of

this subsection shall not apply if the contributing

sponsor demonstrates to the satisfaction of the Corporation that the contributing sponsor is experiencing substantial business hardship. For purposes of

this subparagraph, a contributing sponsor shall be

considered as experiencing substantial business hardship if the contributing sponsor has been operating,

and can demonstrate that the contributing sponsor

will continue to operate, at an economic loss.’’

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 1303, 1342, 1348,

1350, 1362, 1363, 1364, 1370 of this title; title 26 sections

404, 418, 4972.

§ 1341a. Termination of multiemployer plans

(a) Determinative factors

Termination of a multiemployer plan under

this section occurs as a result of—

(1) the adoption after September 26, 1980, of

a plan amendment which provides that participants will receive no credit for any purpose

under the plan for service with any employer

after the date specified by such amendment;

(2) the withdrawal of every employer from

the plan, within the meaning of section 1383 of

this title, or the cessation of the obligation of

all employers to contribute under the plan; or

(3) the adoption of an amendment to the

plan which causes the plan to become a plan

described in section 1321(b)(1) of this title.

(b) Date of termination

(1) The date on which a plan terminates under

paragraph (1) or (3) of subsection (a) of this section is the later of—

(A) the date on which the amendment is

adopted, or

(B) the date on which the amendment takes

effect.

(2) The date on which a plan terminates under

paragraph (2) of subsection (a) of this section is

the earlier of—

(A) the date on which the last employer

withdraws, or

(B) the first day of the first plan year for

which no employer contributions were required under the plan.

(c) Duties of plan sponsor of amended plan

Except as provided in subsection (f)(1) of this

section, the plan sponsor of a plan which terminates under paragraph (2) of subsection (a) of

this section shall—

(1) limit the payment of benefits to benefits

which are nonforfeitable under the plan as of

the date of the termination, and

(2) pay benefits attributable to employer

contributions, other than death benefits, only

in the form of an annuity, unless the plan assets are distributed in full satisfaction of all

nonforfeitable benefits under the plan.

(d) Duties of plan sponsor of nonoperative plan

The plan sponsor of a plan which terminates

under paragraph (2) of subsection (a) of this section shall reduce benefits and suspend benefit

payments in accordance with section 1441 of this

title.

(e) Amount of contribution of employer under

amended plan for each plan year subsequent

to plan termination date

In the case of a plan which terminates under

paragraph (1) or (3) of subsection (a) of this section, the rate of an employer’s contributions

under the plan for each plan year beginning on

or after the plan termination date shall equal or

exceed the highest rate of employer contributions at which the employer had an obligation

to contribute under the plan in the 5 preceding

plan years ending on or before the plan termination date, unless the corporation approves a

reduction in the rate based on a finding that the

plan is or soon will be fully funded.
Page 523 TITLE 29—LABOR § 1342

(f) Payment of benefits; reporting requirements

for terminated plans and rules and standards

for administration of such plans

(1) The plan sponsor of a terminated plan may

authorize the payment other than in the form of

an annuity of a participant’s entire nonforfeitable benefit attributable to employer contributions, other than a death benefit, if the value of

the entire nonforfeitable benefit does not exceed

$1,750. The corporation may authorize the payment of benefits under the terms of a terminated plan other than nonforfeitable benefits, or

the payment other than in the form of an annuity of benefits having a value greater than

$1,750, if the corporation determines that such

payment is not adverse to the interest of the

plan’s participants and beneficiaries generally

and does not unreasonably increase the corporation’s risk of loss with respect to the plan.

(2) The corporation may prescribe reporting

requirements for terminated plans, and rules

and standards for the administration of such

plans, which the corporation considers appropriate to protect the interests of plan participants and beneficiaries or to prevent unreasonable loss to the corporation.

(Pub. L. 93–406, title IV, §4041A, as added Pub. L.

96–364, title I, §103, Sept. 26, 1980, 94 Stat. 1216.)

EFFECTIVE DATE

Section effective Sept. 26, 1980, except as specifically

provided, see section 1461(e) of this title.

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 1081, 1322a, 1342,

1348, 1383, 1396, 1412, 1413, 1421, 1441, 1461 of this title;

title 26 sections 412, 418.

§ 1342. Institution of termination proceedings by

the corporation

(a) Authority to institute proceedings to terminate a plan

The corporation may institute proceedings

under this section to terminate a plan whenever

it determines that—

(1) the plan has not met the minimum funding standard required under section 412 of title

26, or has been notified by the Secretary of the

Treasury that a notice of deficiency under section 6212 of title 26 has been mailed with respect to the tax imposed under section 4971(a)

of title 26,

(2) the plan will be unable to pay benefits

when due,

(3) the reportable event described in section

1343(c)(7) of this title has occurred, or

(4) the possible long-run loss of the corporation with respect to the plan may reasonably

be expected to increase unreasonably if the

plan is not terminated.

The corporation shall as soon as practicable institute proceedings under this section to terminate a single-employer plan whenever the corporation determines that the plan does not have

assets available to pay benefits which are currently due under the terms of the plan. The corporation may prescribe a simplified procedure to

follow in terminating small plans as long as

that procedure includes substantial safeguards

for the rights of the participants and beneficiaries under the plans, and for the employers

who maintain such plans (including the requirement for a court decree under subsection (c) of

this section). Notwithstanding any other provision of this subchapter, the corporation is authorized to pool assets of terminated plans for

purposes of administration, investment, payment of liabilities of all such terminated plans,

and such other purposes as it determines to be

appropriate in the administration of this subchapter.

(b) Appointment of trustee

(1) Whenever the corporation makes a determination under subsection (a) of this section

with respect to a plan or is required under subsection (a) of this section to institute proceedings under this section, it may, upon notice to

the plan, apply to the appropriate United States

district court for the appointment of a trustee

to administer the plan with respect to which the

determination is made pending the issuance of a

decree under subsection (c) of this section ordering the termination of the plan. If within 3 business days after the filing of an application under

this subsection, or such other period as the

court may order, the administrator of the plan

consents to the appointment of a trustee, or

fails to show why a trustee should not be appointed, the court may grant the application

and appoint a trustee to administer the plan in

accordance with its terms until the corporation

determines that the plan should be terminated

or that termination is unnecessary. The corporation may request that it be appointed as

trustee of a plan in any case.

(2) Notwithstanding any other provision of

this subchapter—

(A) upon the petition of a plan administrator

or the corporation, the appropriate United

States district court may appoint a trustee in

accordance with the provisions of this section

if the interests of the plan participants would

be better served by the appointment of the

trustee, and

(B) upon the petition of the corporation, the

appropriate United States district court shall

appoint a trustee proposed by the corporation

for a multiemployer plan which is in reorganization or to which section 1341a(d) of this

title applies, unless such appointment would

be adverse to the interests of the plan participants and beneficiaries in the aggregate.

(3) The corporation and plan administrator

may agree to the appointment of a trustee without proceeding in accordance with the requirements of paragraphs (1) and (2).

(c) Adjudication that plan must be terminated

If the corporation is required under subsection

(a) of this section to commence proceedings

under this section with respect to a plan or,

after issuing a notice under this section to a

plan administrator, has determined that the

plan should be terminated, it may, upon notice

to the plan administrator, apply to the appropriate United States district court for a decree

adjudicating that the plan must be terminated

in order to protect the interests of the participants or to avoid any unreasonable deterioration of the financial condition of the plan or any