48030 Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 

actions are considered FAA-approved if they 

are approved by the State of Design Authority 

(or their delegated agent). You are required 

to assure the product is airworthy before it 

is returned to service. 

(3) Reporting Requirements: For any 

reporting requirement in this AD, under the 

provisions of the Paperwork Reduction Act 

(44 U.S.C. 3501 et seq.), the Office of 

Management and Budget (OMB) has 

approved the information collection 

requirements and has assigned OMB Control 

Number 2120–0056. 

Related Information 

(h) Refer to MCAI Ageˆncia Nacional de 

Aviac ̧a ̃o Civil (ANAC) Brazilian 

Airworthiness Directive AD No.: 2009–09– 

01, dated September 3, 2009, and Phenom by 

Embraer Service Bulletin No. 500–55–0001, 

dated July 24, 2009, for related information. 

Issued in Kansas City, Missouri, on 

September 15, 2009. 

Scott A. Horn, 

Acting Manager, Small Airplane Directorate, 

Aircraft Certification Service. 

[FR Doc. E9–22642 Filed 9–18–09; 8:45 am] 

BILLING CODE 4910–13–P 

JOINT BOARD FOR THE 

ENROLLMENT OF ACTUARIES 

20 CFR Part 901 

[REG–159704–03] 

RIN 1545–BC82 

Performance of Actuarial Services 

Under the Employee Retirement 

Income Security Act of 1974 

AGENCY: Joint Board for the Enrollment 

of Actuaries. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: This document contains 

proposed amendments to 20 CFR part 

901 relating to the enrollment of 

actuaries under section 3042 of the 

Employee Retirement Income Security 

Act of 1974 (ERISA). The proposed 

amendments would update the 

eligibility requirements for performing 

actuarial services for ERISA-covered 

employee pension benefit plans, 

including the continuing education 

requirements, and the standards for 

performing such actuarial services. The 

proposed amendments would affect 

employee pension benefit plans and the 

actuaries providing actuarial services to 

those plans. 

DATES: Written or electronic comments 

must be received by November 20, 2009. 

ADDRESSES: Send written comments to: 

CC:PA:LPD:PR (REG–159704–03), Room 

5203, Internal Revenue Service, PO Box 

7604, Ben Franklin Station, Washington, 

DC 20044. Submissions may be handdelivered Monday through Friday 

between the hours of 8 a.m. and 4 p.m. 

to CC:PA:LPD:PR (REG–159704–03), 

Courier’s Desk, Internal Revenue 

Service, 1111 Constitution Avenue, 

NW., Washington, DC or sent 

electronically via the Federal 

eRulemaking Portal at http:// 

www.regulations.gov (IRS REG–159704– 

03). 

FOR FURTHER INFORMATION CONTACT: 

Patrick McDonough, Executive Director, 

Joint Board for the Enrollment of 

Actuaries, (202) 622–8229 (not a tollfree number). 

SUPPLEMENTARY INFORMATION: 

Paperwork Reduction Act 

The collections of information 

referenced in this notice of proposed 

rulemaking were previously reviewed 

and approved by the Office of 

Management and Budget in accordance 

with the Paperwork Reduction Act of 

1995 (44 U.S.C. 3507(d)) under control 

number 1545–0951, relating to Enrolled 

Actuaries under Employee Retirement 

Income Security Act of 1974, published 

on September 7, 1988, in the Federal 

Register (53 FR 34484). There are no 

proposals for substantive changes to this 

collection of information. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

unless it displays a valid control 

number assigned by the Office of 

Management and Budget. 

Books or records relating to a 

collection of information must be 

retained as long as their contents may 

become material in the administration 

of any internal revenue law. Generally, 

tax returns and tax return information 

are confidential, as required by 26 

U.S.C. 6103. 

Background 

This document contains proposed 

amendments to 20 CFR Part 901 under 

section 3042 of the Employee 

Retirement Income Security Act of 1974 

(88 Stat. 829), Public Law 93–406 

(ERISA). Section 3042 of ERISA 

provides that the Joint Board for the 

Enrollment of Actuaries (Joint Board) 

shall, by regulations, establish 

reasonable standards and qualifications 

for persons performing actuarial 

services with respect to plans subject to 

ERISA and, upon application by any 

individual, shall enroll such individual 

if the Joint Board finds that such 

individual satisfies such standards and 

qualifications. Section 3042 also 

provides that the Joint Board may, after 

notice and an opportunity for a hearing, 

suspend or terminate the enrollment of 

an individual who fails to discharge his 

duties under ERISA or who does not 

satisfy the requirements for enrollment. 

Consistent with section 3042, the 

Joint Board has promulgated regulations 

at 20 CFR part 901, addressing 

eligibility for enrollment, requirements 

for continuing education of enrolled 

actuaries, professional standards for 

performance of actuarial services under 

ERISA, bases for disciplinary actions 

and the procedures to be followed in 

taking those actions. Comprehensive 

regulations regarding section 3042 were 

last issued in 1988 (53 FR 34484). The 

Joint Board has determined that the 

regulations need to be updated to reflect 

changes in the law and in industry 

practice. In addition to these proposed 

regulations, final regulations relating to 

user fees for the initial enrollment and 

reenrollment as an enrolled actuary 

were published in the Federal Register 

on December 21, 2007 (72 FR 72606). 

In anticipation of amending the Joint 

Board regulations, the Joint Board 

issued a Request for Information (RFI) 

which was published in the Federal 

Register on June 30, 2004 (69 FR 39376). 

The RFI specifically requested 

comments as to whether, and to what 

extent, changes should be made to the 

regulations in the following five areas: 

1. Procedures and conditions for 

enrollment and reenrollments; 

2. Continuing professional education 

(CPE) requirements; 

3. Waivers of the CPE requirements; 

4. Types of enrollment statuses 

(active, inactive, and retired); and 

5. Standards of conduct. 

Eight comments were received. 

The current regulations prescribe 

various rules regarding the enrollment 

and reenrollment of actuaries. Section 

901.13 of the regulations provides that 

an individual applying for enrollment 

must satisfy requirements for: (1) 

Qualifying experience; (2) basic 

actuarial knowledge; and (3) pension 

actuarial knowledge. Basic actuarial 

knowledge may be demonstrated by 

passing a Joint Board examination (or an 

examination acceptable to the Joint 

Board) regarding basic actuarial 

mathematics and methodology, or by 

earning a degree pertaining to actuarial 

mathematics from an accredited college. 

Pension actuarial knowledge must be 

demonstrated by passing a Joint Board 

examination (or an examination 

acceptable to the Joint Board) in 

actuarial mathematics related to pension 

plans. 

Under section 901.11, an enrolled 

actuary must reenroll once every three 

years. To qualify for reenrollment an 

actuary must complete a minimum of 36 


srobinson on DSKHWCL6B1PROD with PROPOSALS
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1The regulations also include transitional rules 

for reenrollment cycles prior to 1993. This summary 

refers to the rules currently applicable. 

2This rule would be applied prospectively. 

Accordingly, the successful completion of a 

pension actuarial examination prior to the effective 

date of this regulation will be recognized for ten 

years after such effective date. 

hours of continuing education credit 

within the preceding three year period.1

Of these 36 hours, at least one-half must 

consist of core subject matter, which is 

subject matter directly related to the 

performance of actuarial services under 

ERISA or the Internal Revenue Code 

(Code). The remaining hours may 

consist of non-core subject matter. The 

regulations provide examples of both 

core and non-core subject matter. The 

regulations provide that the Executive 

Director of the Joint Board may review 

the CPE records of an enrolled actuary 

to verify compliance with these rules. 

The regulations also provide that the 

continuing education must be provided 

as part of a ‘‘qualifying program’’ 

conducted by a ‘‘qualifying sponsor.’’ A 

qualifying program is (1) a ‘‘formal 

program’’ (which requires the 

attendance of at least three individuals 

engaged in substantive pension service), 

(2) a correspondence or individual 

study program, or (3) a program 

utilizing teleconferencing. A qualifying 

sponsor is an accredited educational 

institution, an organization recognized 

by a State licensing body, or an 

organization recognized by the Joint 

Board under a sponsor agreement in 

effect for a given enrollment cycle. A 

qualifying sponsor must ensure that the 

CPE program satisfies various 

requirements regarding subject matter 

and administration, including 

recordkeeping. A separate provision 

applies to the recordkeeping 

requirements for the enrolled actuary. 

In addition to attending CPE 

programs, an enrolled actuary may earn 

CPE credits by serving as an instructor 

or speaker at a CPE program, publishing 

articles on topics directly related to the 

CPE requirements, serving on a Joint 

Board advisory committee, participating 

in the preparation of Joint Board 

examinations, passing examinations 

sponsored by recognized organizations, 

or by passing a Joint Board pension law 

actuarial examination. These alternative 

means for earning CPE credits are 

subject to various requirements and 

limitations. 

In the event an enrolled actuary 

applies for renewal but fails to comply 

with the applicable requirements, the 

regulations provide that the enrolled 

actuary shall be notified of his or her 

failure and given an opportunity to 

provide additional information. If the 

enrolled actuary fails to provide any 

additional information (or fails to apply 

for reenrollment) the actuary will be 

placed in inactive status for a period of 

three years (beginning on the date that 

renewal would have been effective) and 

will be ineligible to perform services as 

an enrolled actuary during this time. An 

individual placed in inactive status 

must file an application for renewal and 

satisfy the requirements for renewal 

within three years or his enrollment will 

terminate. If an individual’s enrollment 

is terminated, it can only be 

reestablished by satisfying the 

requirements for initial enrollment. 

The regulations also provide that an 

individual may request placement in an 

inactive retirement status during which 

time the actuary will be ineligible to 

perform services as an enrolled actuary. 

An individual placed in this status may 

be reinstated by completing the required 

CPE credits for the applicable period. 

Section 901.20 of the regulations 

prohibits an enrolled actuary from 

performing actuarial services under 

various circumstances including when 

the actuary is not qualified to perform 

the service, where the actuary has 

reasonable grounds to believe his or her 

services will be used in a fraudulent 

manner, or where there is a conflict of 

interest. The section also requires that 

an enrolled actuary must exercise due 

care, skill, and diligence in providing 

his or her pension actuarial services and 

proper utilization of the enrolled 

actuary designation. 

Explanation of Provisions 

The submitted comments and the 

related proposed changes to the 

regulations may be divided into the five 

categories of the RFI. 

A. Procedures for Enrollment and 

Reenrollment 

Various comments were received 

regarding the materials covered by the 

enrolled actuary examinations. Several 

comments supported broadening the 

scope of the material to include matters 

unrelated to defined benefit plans, such 

as the funding of post-retirement 

medical and life insurance benefits 

within the meaning of Code sections 

419 and 419A. To the extent that an 

enrolled actuary may need to practice 

before the IRS in these areas, one 

comment suggested that an enrolled 

actuary should be permitted to work 

together with a qualified health actuary. 

In contrast, another comment suggested 

focusing the examinations exclusively 

on pension actuarial issues under 

ERISA and the Code. Some comments 

called for a stronger emphasis on the 

selection of actuarial assumptions. One 

such comment acknowledged that the 

subject is not easily tested, but made 

suggestions as to how this could be 

done. 

Another comment proposed 

eliminating requirements for the 

examinations to cover specific materials 

and instead have the regulations grant 

the Joint Board the authority and 

flexibility to prescribe relevant and 

current topics. 

There were also suggestions regarding 

the process and form of testing. One 

comment suggested that focusing each 

examination question on a single 

concept (instead of multiple concepts as 

is done currently) would enable a 

candidate to avoid losing credit for an 

entire question if he/she responds 

correctly to all but one of the concepts 

being tested. It was also suggested that 

the regulations allow more flexibility in 

the number of exams and that they 

clarify any time limit for their 

completion. 

One comment recommended the use 

of computer-based testing and other 

emerging alternative testing procedures, 

and coordination of changes in the Joint 

Board examinations with related 

examinations offered by recognized 

organizations. 

There was general agreement among 

the comments in keeping the current 

qualifying experience requirement 

unchanged although one comment 

suggested that the regulations require 

that an applicant’s actuarial experience 

be certified by an enrolled actuary. 

No changes are made under the 

proposed regulations to the materials 

covered by either the basic actuarial 

examination or to the examination for 

pension actuarial knowledge. The Joint 

Board believes that the provisions of the 

current regulations regarding the general 

form and structure of the examinations, 

as updated from time to time, are 

adequate. 

The proposed regulations, however, 

would require that the pension actuarial 

examination must be completed within 

the ten-year period immediately 

preceding the date of application for 

initial enrollment. The Joint Board 

believes such a requirement is needed 

because of the frequent changes in 

pension law and a need for an enrolled 

actuary to have current knowledge of 

pension requirements.2 On the other 

hand, because the material in the basic 

actuarial examination is generally 

mathematical in nature and is not 

affected by changes in pension law, a 

similar rule for the basic actuarial 

examination would not apply. 

With respect to computer-based 

testing, the Joint Board acknowledges 


srobinson on DSKHWCL6B1PROD with PROPOSALS
48032 Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 

that new technologies can serve many 

uses. The Joint Board believes, however, 

that the language in the current 

regulations would not preclude the use 

of computer-based testing and does not 

believe it is necessary to amend the 

regulations to specify the format for 

taking examinations. 

With respect to qualifying experience, 

the proposed regulations would require 

that all actuarial and pension actuarial 

experience be certified in writing by 

individuals with knowledge of the 

individual’s experience. If the 

individual’s supervisor is not an 

enrolled actuary, the pension actuarial 

experience must be certified by both the 

supervisor and an enrolled actuary with 

knowledge of the individual’s pension 

experience. As in the current 

regulations, the qualifying experience 

must have been completed within the 

last 10 years before the application for 

enrollment. 

B. CPE Requirements 

Several comments were received 

regarding the distinction between core 

and non-core subject matter. One 

comment suggested that the distinction 

between core and non-core subject 

matter be eliminated for purposes of 

meeting CPE requirements as the 

distinction does not serve a useful 

purpose in a rapidly evolving financial 

marketplace and regulatory 

environment. The comment added that, 

assuming these core/non-core categories 

were kept, additional guidance should 

be provided as to what constitutes core 

and non-core credit subject matter. 

Other comments suggested that the 

list of core subject matter be expanded 

to include such topics as pension 

accounting, Code sections 419, 419A 

and 420, risk theory, and finance. 

Another comment specifically 

supported adding pension accounting, 

but objected to counting investment 

topics as core topics. Another comment 

recommended including various 

additional topics in an expanded list of 

acceptable non-core topics such as 

defined contribution plans, Social 

Security and Medicare benefits, pension 

valuation software programming, other 

accounting, risk management and new 

emerging topics in actuarial practice. 

Another comment recommended 

replacing the core/non-core 

classification with three new categories: 

(1) Retirement plan rules under ERISA 

and the Code (including, but not limited 

to, sections 401 through 420), (2) 

funding issues in relation to defined 

benefit plans, and (3) actuarial ethics. 

This comment also suggested requiring 

at least 45 hours of CPE credit (with a 

minimum of three hours in funding 

issues and in actuarial ethics) and 

granting the Joint Board the authority to 

designate additional mandatory areas of 

CPE. One comment recommended that 

the definition of ‘‘core’’ subject matter 

should continue to be focused on 

pension actuarial services under ERISA 

and the Code and opposed any 

expansion of the definition of core 

subject matter. 

Some comments suggested 

distinguishing between CPE credits 

required early in an actuary’s career, 

where core courses may be necessary to 

help cement the actuary’s 

understanding of actuarial principles, 

and credits needed later in an actuary’s 

career. One comment suggested, for 

example, that 18 hours of core CPE 

credit be required for the first two 

enrollment cycles and that 12 hours of 

core credit be required in subsequent 

enrollment cycles. It was also suggested 

that a minimum of three hours of ethics 

be required. 

Many comments, particularly from 

sponsors of CPE programs, requested 

flexibility in the use of the web and 

other alternatives to formal meetings. 

For example, some suggested that 

computer-based self-study or distance 

learning programs and webcasts should 

be included as qualifying CPE programs. 

A number of comments sought 

additional guidance from the Joint 

Board regarding the use of webcasts and 

self-study programs to earn CPE credits. 

The issues raised in this regard included 

the need for appropriate safeguards and 

mechanisms to validate participation by 

the actuary. In recognition that future 

technological advances are almost 

certain to occur, another comment 

recommended that the regulations be 

revised to allow a qualifying sponsor to 

apply to the Joint Board for approval to 

use those technologies. The comment 

also suggested that the regulations 

specifically give the Joint Board the 

authority to permit the use of those 

emerging technologies, with acceptance 

of the technology being communicated 

via a public announcement without 

requiring the Joint Board to further 

update the regulations. 

One comment recommended 

permitting actuaries to attest in their 

professional capacities to their 

completion of continuing education 

credit, and the establishment of an 

appropriate audit process to oversee 

compliance with the rules. The 

comment further recommended that the 

Joint Board undertake random audits of 

CPE records to ensure compliance with 

the attestation requirement. Similarly, 

another comment recommended an 

enrolled actuary should be required to 

certify that he/she has satisfied certain 

CPE requirements and to provide 

information regarding whether or not 

he/she has been disciplined or is under 

disciplinary review by any professional 

body. 

One comment suggested that the 

requirement that a formal program be 

attended by at least three individuals 

engaged in substantive pension service 

may be satisfied, in the case of programs 

viewed simultaneously at multiple 

locations via teleconference, web cast, 

conference call or other similar 

technology, if the total combined 

audience at all locations contains at 

least three such individuals. 

Several comments recommended 

various electronic means to retain 

records and to streamline the 

application process. One comment 

recommended that a qualifying sponsor 

be required to keep electronic copies of 

the session materials, but make them 

accessible to the Joint Board should they 

need to be reviewed or audited for 

content. Another comment 

recommended that the Joint Board 

provide for on-line renewal of 

enrollment and an on-line process for an 

actuary to respond to an audit of his/her 

CPE credits. A third comment 

recommended that all records be 

maintained electronically and that CPE 

credit hours be provided and stored 

electronically, enabling the Joint Board 

to have access to the credit hours earned 

by actuaries at all times and reducing 

the volume of hard copy recordkeeping. 

One comment recommended 

extending the enrollment cycle to 5 

years with an increase in the required 

CPE credits to 60 hours, including a 

minimum of 8 hours in each year of the 

cycle. Another comment suggested that 

the current CPE requirement (36 credit 

hours over a three year cycle) is 

appropriate, with some possible 

refinements such as either reducing the 

credits that could be earned for each 

hour as a presenter and increasing the 

current limit on such credits as a 

portion of total CPE; allowing CPE 

credits as a co-author (if not the primary 

author); or withholding session credit to 

an attendee for inattentive or disruptive 

conduct. 

One comment suggested that the 

regulations should provide guidance on 

renewal of approval for qualifying 

sponsors. There were a few comments 

that suggested changing the enrollment 

cycle for qualifying sponsors so as not 

to be coterminous with the enrolled 

actuary enrollment cycle or to increase 

the number of years in the sponsor 

enrollment cycle. Another comment 

suggested the regulations be amended to 

allow the Joint Board to periodically 

publish a list of qualifying sponsors in 


srobinson on DSKHWCL6B1PROD with PROPOSALS
Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 48033 

order to facilitate a search for programs 

that are eligible for CPE credits. 

The Joint Board continues to believe 

that an important thrust of CPE should 

be core subject matter that is directly 

related to pension actuarial services 

under ERISA and the Code, an area in 

which an enrolled actuary must 

maintain minimum competencies at all 

times. The Joint Board also believes that 

there are other relevant non-core topics 

that enhance the knowledge of enrolled 

actuaries and keep them current in 

matters related to the performance of 

pension actuarial services. The 

proposed regulations would provide a 

revised definition of ‘‘core’’ subject 

matter which the Joint Board believes 

will be helpful in distinguishing 

between core and non-core subject 

matter. The lists of core and non-core 

subject matter are generally unchanged, 

but the proposed regulations would 

provide that all materials included on 

the syllabi of any of the pension 

actuarial examinations offered by the 

Joint Board during the current and 

immediately preceding enrollment 

cycles would constitute core subject 

matter. The Joint Board also invites 

further comments in this area. 

With respect to CPE programs, the 

proposed regulations would clarify the 

permissible forms of qualifying 

programs. The regulations would also 

retain the use of alternative means for 

completion of CPE, but continue to limit 

the portion of total CPE that may be 

earned under these alternative 

approaches. The regulations would also 

add a provision that awards CPE credits 

to a co-author of a publication or a 

person listed as a major contributor to 

a publication. 

The proposed regulations would also 

clarify the responsibilities of program 

sponsors by requiring that those who 

submit requests to the Executive 

Director to be recognized as qualifying 

sponsors include sufficient information 

in their requests to establish that their 

programs would satisfy the applicable 

requirements for qualifying programs. 

The Joint Board agrees that new 

technologies allow enrolled actuaries 

and qualifying sponsors more flexibility 

in their choices of form and delivery of 

CPE programs and should be reflected 

when granting CPE credits. However, 

new technologies also raise new 

challenges regarding verification of 

attendance and completion of CPE 

under certain programs. Therefore, the 

proposed regulations would allow 

qualifying programs to include both 

formal programs as well as 

correspondence or individual study 

programs (including audio and/or video 

taped programs) and teleconferencing 

(including web casts) provided that the 

qualifying program meets certain 

requirements with regard to verification 

of attendance and measurement of 

completion. 

The Joint Board also agrees that 

recordkeeping provisions under the 

current regulations should be updated. 

The proposed regulations would amend 

the recordkeeping requirements to place 

more reliance on qualifying sponsors to 

maintain records of the course content 

since they generally maintain records of 

that content in any event. The enrolled 

actuaries will now be required only to 

retain certificates of completion and/or 

instruction as evidence of satisfaction of 

CPE requirements. In addition, the 

proposed regulations would expressly 

allow the Joint Board to request CPE 

records from the enrolled actuary and 

the qualifying sponsor. The regulations 

do not reflect any changes in the 

method used to provide information to 

the office of the Executive Director. 

However, the Board is willing to 

consider web-based applications or 

other technology for this information in 

the future. 

With respect to the renewal cycle and 

required CPE credits, the Joint Board 

continues to believe that the current 

three-year renewal period is 

appropriate. The Board, however, 

proposes to delay the start date for the 

renewal cycle for qualifying sponsors by 

one year after the renewal cycle for 

enrolled actuaries in order to ease the 

administrative demands on the 

Executive Director and his staff, and to 

facilitate renewals by qualifying 

sponsors. 

The proposed regulations would also 

retain the current requirement for a total 

of 36 hours of CPE (half of which must 

be core subject matter) for the initial 

three-year enrollment renewal cycle, for 

individuals who renew on a timely 

basis. Recognizing, however, that 

experienced actuaries generally do not 

need to focus on core topics as much as 

newly enrolled actuaries, the proposed 

regulations would reduce the number of 

core CPE credits required after the 

enrolled actuary’s initial enrollment 

renewal from 18 required core hours to 

12 required core hours. The Joint Board 

also believes that enrolled actuaries 

should maintain high professional 

standards and thus proposes a new 

requirement that a minimum of two 

hours of core CPE be allocated to ethical 

standards in each enrollment cycle. 

Topics that would meet this 

requirement include (but are not limited 

to) discussions of professional codes of 

conduct, professional responsibilities, 

and any of the topics addressed in 

section 901.20 of these proposed 

regulations. 

The Joint Board believes that formal 

programs should continue to play a 

prominent role in fulfilling CPE 

requirements because of the additional 

learning opportunities that occur in 

face-to-face interactions with other 

enrolled actuaries. Therefore, no change 

is proposed to the current requirement 

that a formal program must have at least 

three individuals in attendance who are 

engaged in substantive pension service. 

Furthermore, the proposed regulations 

would add a new requirement that a 

minimum of one-third of the required 

total CPE credits must be in the form of 

formal programs. 

The proposed regulations would also 

retain current limits on the maximum 

number of CPE credits that can be 

obtained under alternative CPE 

programs, such as authoring published 

articles (25 percent), as a percentage of 

total CPE per enrollment cycle. Under 

the proposed regulations, however, 

college courses will no longer be 

available as an alternative program for 

purposes of fulfilling CPE requirements 

(unless they meet the requirements of a 

qualifying program) due to the practical 

difficulties in evaluating course 

curricula and the qualifications of the 

instructors. Despite the elimination of 

the specific list of conditions that would 

support a waiver, circumstances such as 

extended active military duty will 

continue to constitute strong evidence 

of the type of extraordinary 

circumstances that would justify a 

waiver. 

C. Waivers of the CPE Requirements 

One comment suggested expanding 

the list of conditions for which a waiver 

from CPE requirements may be granted 

to include parental leave. Another 

comment recommended that 

applications for a waiver of the CPE 

requirements be accepted during the 

normal enrollment renewal process, 

subject to the Joint Board’s discretion to 

accept late filings. A third comment did 

not perceive problems with the current 

waiver process and standards. There 

were no other specific recommendations 

regarding this issue except in 

conjunction with proposals regarding 

changes in enrollment status. 

The Joint Board believes that it is 

essential for practicing actuaries to keep 

their knowledge current, particularly 

given the frequent changes in pension 

law, court decisions, and other factors 

that affect an enrolled actuary’s practice. 

Accordingly, and in light of the 

expanded varieties of acceptable CPE 

programs, the proposed regulations 

would eliminate the list of reasons for 


srobinson on DSKHWCL6B1PROD with PROPOSALS
48034 Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 

which a CPE waiver may be granted and 

provide instead that a waiver from the 

CPE requirements may be granted only 

under extraordinary circumstances and 

only upon submission of evidence that 

every effort was made during the entire 

renewal cycle to complete such 

requirements. Despite the elimination of 

the specific list of conditions that would 

support a waiver, circumstances such as 

extended active military duty will 

continue to constitute strong evidence 

of the type of extraordinary 

circumstances that would justify a 

waiver. 

D. Enrollment Status 

Several comments were directed to 

the status for ‘‘inactive retirement’’ 

which may be elected by an actuary. 

One comment suggested that the Joint 

Board allow for some flexibility in the 

renewal process in order to reduce the 

need for individuals to request inactive 

retirement status and to ensure a 

minimal period of disruption of 

actuarial services to plans and 

employers. For example, it was 

recommended that any CPE credit hours 

completed between December 31 (or the 

end of the enrollment period by which 

CPE credits must be earned for that 

period) and the date the application for 

renewal is filed be permitted to be used 

to satisfy the CPE requirement for 

renewal of enrollment effective April 1. 

Thus, the comment stated that an 

enrolled actuary who files an 

application for renewal after March 1 

due to delayed completion of the CPE 

requirement should be eligible to 

perform services as an enrolled actuary 

30 days after the application filing date 

unless notified otherwise by the Joint 

Board. However, these delayed CPE 

credits would not be permitted to be 

applied to another enrollment cycle. 

Under the current regulations, an 

actuary in inactive retirement status is 

ineligible to perform services as an 

enrolled actuary, but the actuary may be 

reinstated by completing the ‘‘required 

continuing professional education 

credits for the applicable enrollment 

cycle’’ regardless of how long the 

actuary was inactive. Several comments 

stated that this status, and the 

requirements for reinstatement, were 

unclear. Some comments suggested that 

inactive retirement status be available 

for no more than three consecutive 

three-year enrollment cycles, but that if 

the individual has been retired for less 

than three three-year enrollment cycles, 

the actuary would be allowed to ‘‘back 

fill’’ any missing CPE requirements. 

One comment recommended that the 

regulations be revised to extend inactive 

status to six years (or a maximum of two 

three-year enrollment cycles). The 

comment stated that three years is too 

short since an enrolled actuary often 

leaves the workforce for child-rearing or 

other reasons, and should not be 

discouraged from resuming his/her 

career. Another comment recommended 

that the regulations be clarified to 

specify more clearly the CPE 

requirements for reinstatement as of 

various points of time during the 

following three-year cycle, and the 

relationship of those CPE requirements 

with the requirements for ongoing 

renewal after reinstatement. One 

comment suggested special catch-up 

requirements where an individual 

would have to ‘‘back fill’’ any missing 

CPE requirements (for example, 108 

hours of CPE credits would be required 

for an actuary who had missed two 

enrollment renewal cycles, with 36 

credits required for each inactive 

enrollment cycle plus 36 credits 

required for the enrollment cycle 

immediately preceding the date on 

which the individual returns to active 

status). The comment suggested that any 

individual who fails to complete the 

necessary back fill would need to follow 

current reenrollment procedures. The 

comment further stated that, depending 

on the circumstances, a waiver of some 

CPE requirements may be permitted for 

an enrolled actuary going from inactive 

to active status. 

The Joint Board agrees that the 

current rules relative to the different 

inactive statuses warrant simplification. 

The proposed regulations would limit 

enrollment statuses to only two 

categories, ‘‘active’’ or ‘‘inactive,’’ with 

special provisions for reinstatement 

depending on the length of the period 

during which an enrolled actuary is in 

inactive status and for those situations 

where an actuary’s status is terminated 

for cause. An enrolled actuary who 

timely renews his/her enrollment would 

be in active status. An enrolled actuary 

who fails to meet requirements for 

timely renewal of enrollment would be 

in inactive status. While in inactive 

status, an enrolled actuary would be 

prohibited from performing pension 

actuarial services under ERISA and the 

Code. 

The Joint Board also believes that the 

longer an actuary has been in inactive 

status, the less likely it is that he/she 

has kept up with current developments 

or had the current work experience 

necessary to competently function as an 

enrolled actuary. The proposed 

regulations would increase the CPE 

requirements and/or add experience 

requirements for reenrollment for 

actuaries in inactive status, with more 

stringent requirements applying to those 

who have been inactive for a longer 

period of time. Under the proposed 

regulations, an individual who applies 

for reenrollment during his or her first 

inactive enrollment cycle would need to 

complete 36 hours of CPE (including 

CPE credits from the immediately 

preceding enrollment cycle) in order to 

qualify for reenrollment. An individual 

who applies during the second inactive 

enrollment cycle would need to 

complete 48 hours of CPE (counting 

only those credits earned during the 

first and second inactive enrollment 

cycles) and must also have 18 months 

of certified responsible pension 

actuarial experience since the start of 

the first inactive cycle. An individual 

who applies during the third active 

enrollment cycle would need to 

complete 60 hours of CPE (counting 

only those credits earned during the 

second and third inactive enrollment 

cycles) and have 18 months of certified 

responsible pension actuarial 

experience since the start of the second 

inactive cycle. The proposed regulations 

present some examples to illustrate 

these changes. 

Furthermore, the proposed 

regulations would limit the time that an 

enrolled actuary can be in inactive 

status and remain eligible to apply for 

reenrollment. If the enrolled actuary 

does not qualify and apply for 

reenrollment after being in inactive 

status for three enrollment cycles, he or 

she would be placed in terminated 

status and would have to meet the 

requirements for initial enrollment 

(including the applicable examination 

requirements) in order to be reinstated 

as an enrolled actuary. 

Notwithstanding these general rules 

for reenrollment from inactive status, 

any application for reenrollment from 

termination status due to disciplinary 

reasons would be subject to special 

consideration by the Executive Director. 

An individual placed in inactive status 

prior to the effective date of the final 

regulations would be deemed to have 

been placed in inactive status on that 

date and thus considered to be in his/ 

her first inactive enrollment cycle on 

that date for purposes of determining 

the requirements for a return to active 

status. 

E. Standards of Conduct 

One comment states that the Joint 

Board has not been very active in 

investigating and disciplining enrolled 

actuaries whose performance does not 

meet applicable standards. One 

comment suggested that the Joint Board 

consider utilizing the Actuarial Board 

for Counseling and Discipline as an 

independent contractor to investigate 


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Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 48035 

complaints. Alternatively, it was 

recommended that the Joint Board 

either require an enrolled actuary to 

become a member of a professional 

actuarial organization as a condition of 

enrollment (thereby subjecting the 

member to the Actuarial Code of 

Professional Conduct (Code of Conduct) 

to which all the major actuarial 

organizations in the U.S. and Canada 

subscribe), or incorporate the Code of 

Conduct into the regulations. 

Another comment stated that, unlike 

other professionals, an enrolled actuary 

is not compelled to operate within 

certain standards by the underlying 

threat that failure to do so will result in 

the loss of his/her license to practice in 

the profession. Even if an enrolled 

actuary is a member of an actuarial 

organization and subject to that 

organization’s disciplinary procedures, 

this comment suggested that the Joint 

Board not rely on these organizations in 

this area, but rather that the Joint Board 

more actively utilize its current 

authority under ERISA to supervise and 

evaluate the provision of actuarial 

services and to discipline enrolled 

actuaries. This comment also suggested 

that the Joint Board periodically publish 

information regarding the nature and 

types of complaints received, the 

number of actuaries disciplined and the 

nature of the discipline. This comment 

indicated that publicizing such 

information would reassure the public 

that complaints are being acted upon 

and encourage compliance with the 

applicable standards. 

Another comment recommended that 

the Board coordinate with other 

actuarial or governmental bodies, for 

example, the IRS or PBGC, so that if any 

other body finds that an enrolled 

actuary has violated the standards of 

conduct, performance or practice 

relating to the performance of actuarial 

services, including all applicable 

regulations and revenue rulings, the 

respective body will refer the offending 

individual to the Joint Board for 

possible suspension or termination of 

his/her enrollment. 

One comment reiterated a concern 

that actuaries who do not have 

significant credentials in the health tax 

area should not be encouraged to engage 

in unqualified practice under the Code, 

or in an area where they do not meet the 

qualification standards in accordance 

with the Code of Conduct. The 

commentator recommended that the 

Joint Board outline those areas where 

the enrolled actuary may rely on the 

expertise of another actuary and any 

qualifications needed for those other 

actuaries as appropriate. 

One comment stated that the 

standards of performance of actuarial 

services set forth in current regulations 

are adequate. The comment suggested, 

however, in the event the Board were to 

decide that these standards need to be 

expanded, that any differences from the 

Code of Conduct be kept to a minimum 

or, wherever possible, any expanded 

regulatory standards should incorporate 

the applicable parts of the Code of 

Conduct. 

In light of the responses to the RFI 

regarding actuarial standards of 

performance, the proposed regulations 

would clarify existing provisions in this 

area and add some new provisions. 

Specifically, the proposed regulations 

would add a new general standard that 

would require enrolled actuaries to 

perform actuarial services in accordance 

with all applicable laws and the 

relevant standards of professional 

responsibility and, as under the current 

regulations, require that enrolled 

actuaries not perform any actuarial 

services where those services may be 

used in a fraudulent manner. The 

proposed regulations would also 

provide that an enrolled actuary must 

report any material violation of this 

section by another enrolled actuary to 

the Executive Director of the Joint 

Board. For example, an enrolled actuary 

that replaces another enrolled actuary as 

a plan’s actuary and discovers that the 

previous actuary had signed a Schedule 

B that listed plan contributions that the 

previous actuary knew had not been 

made would be required to report this 

violation to the Executive Director. 

The proposed regulations would also 

modify the rules regarding conflicts of 

interest. The regulations currently 

provide that in any situation in which 

an enrolled actuary has a conflict of 

interest with respect to the performance 

of actuarial services, the actuary shall 

not perform such services until full 

disclosure of the conflict has been made 

to the affected parties. The proposed 

regulations would add that such 

disclosure must be made in writing and 

that the affected parties must agree in 

writing to the enrolled actuary 

performing the services. The proposed 

regulations would also provide that the 

actuary must reasonably conclude that 

his or her ability to act impartially is not 

impaired by the conflict and the 

performance of such services is not 

prohibited by law. 

The current regulations also provide 

that an enrolled actuary must exercise 

due care, skill, prudence, and diligence 

to ensure that all actuarial assumptions 

are reasonable in the aggregate and that 

all calculations are accurately carried 

out. To reflect changes made in the law 

made by the Pension Protection Act of 

2006, Public Law 109–280, the proposed 

regulations would provide that an 

enrolled actuary must exercise sufficient 

due care, diligence, skill, and prudence 

as is required to ensure that all actuarial 

assumptions are reasonable individually 

and in combination. The proposed 

regulations would also require that all 

calculations not only be accurately 

carried out but also properly 

documented. 

The proposed regulations would also 

expressly expand the due diligence 

requirement into other areas. For 

example, the proposed regulations 

would require that an enrolled actuary 

must exercise due diligence in 

preparing documents to be filed with 

Federal and State entities and in 

determining the correctness of oral and 

written representations to those entities 

and to clients. This section of the 

proposed regulations follows section 

10.22(a) of the regulations governing 

practice before the IRS (Circular 230) 

except to include other agencies where 

enrolled actuaries typically file 

documents or make representations in 

connection with the performance of 

pension actuarial services. 

The proposed regulations would also 

include other provisions similar to those 

in Circular 230 regarding solicitations of 

employment. For example, the current 

regulations provide that an enrolled 

actuary shall not advertise his or her 

status as an enrolled actuary in any 

solicitation related to the performance 

of actuarial services and shall not 

employ or share fees with any 

individual who so solicits. The 

proposed regulations would modify this 

prohibition by adding a rule similar to 

that in section 10.30(a)(1) of Circular 

230 by providing that an enrolled 

actuary may not use any form of public 

or private solicitation containing a false, 

fraudulent, or misleading claim. Also, as 

provided in section 10.30(a)(2) of 

Circular 230, the proposed regulations 

would provide that an enrolled actuary 

may not make uninvited solicitations of 

employment if the solicitation violates 

Federal or State law and any lawful 

solicitations must clearly identify the 

solicitation as such and, if applicable, 

identify the source of the information 

used in choosing the recipient of the 

solicitation. 

The proposed regulations would also 

include provisions similar to those in 

Circular 230 regarding the prompt 

disposition of pending matters and the 

return of client records, except the 

Circular 230 rules would be modified 

for purposes of these regulations to 

reflect the fact that enrolled actuaries 

deal with government entities in 


srobinson on DSKHWCL6B1PROD with PROPOSALS
48036 Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 

addition to the IRS. Thus, as under 

section 10.23 of Circular 230, the 

proposed regulations would provide 

that an enrolled actuary may not 

unreasonably delay the prompt 

disposition of any matter before the IRS, 

but the proposed regulations would 

extend the rule for these purposes to 

matters before the Department of Labor, 

the PBGC and other applicable Federal 

and State entities. Similarly, the 

proposed regulations would adopt 

provisions similar to those in section 

10.27 of Circular 230 regarding the 

return and retention of client’s records, 

but they would define ‘‘records of the 

client’’ for these purposes to include 

documents related to legal obligations in 

addition to Federal tax obligations. The 

provisions of these proposed regulations 

would not modify the Circular 230 

regulations but would apply rules to 

enrolled actuaries in addition to those 

already applicable under Circular 230. 

The Joint Board believes that the 

current structure and procedures for the 

disciplining of enrolled actuaries are 

adequate and consistent with Federal 

statutes and so is not proposing any 

changes to the existing regulations in 

this regard. The Joint Board emphasizes 

that anyone, including other members of 

the profession and plan officials and 

participants, can make referrals to the 

Executive Director regarding any 

suspicious activity or conduct that may 

warrant further investigation or 

discipline. The Joint Board is also 

considering in a separate action 

amending the application forms for 

enrollment and renewal to require 

additional information that may be 

relevant to standards of performance, 

including any record of violations of the 

law or prior misconduct, and requests 

comments in that regard. 

Proposed Effective/Applicability Date 

These regulations are proposed to 

generally apply 30 days after the date 

these regulations are published as final 

regulations in the Federal Register. 

However, section 901.11 regarding the 

enrollment of actuaries would apply to 

the enrollment cycle beginning January 

1, 2011, and ending December 31, 2013, 

and to all subsequent enrollment cycles. 

Special Analyses 

It has been determined that this notice 

of proposed rulemaking is not a 

significant regulatory action as defined 

in Executive Order 12866. Therefore, a 

regulatory assessment is not required. It 

also has been determined that section 

553(b) of the Administrative Procedure 

Act (5 U.S.C. chapter 5) does not apply 

to these regulations, and therefore the 

Regulatory Flexibility Act (5 U.S.C. 

chapter 6) does not apply. This notice 

of proposed rulemaking will be 

submitted to the Chief Counsel for 

Advocacy of the Small Business 

Administration for comment on its 

impact on small business. 

Comments and Requests for Public 

Hearing 

Before these proposed regulations are 

adopted as final regulations, 

consideration will be given to any 

written (a signed original and eight (8) 

copies) or electronic comments that are 

submitted timely to the IRS. The Joint 

Board specifically requests comments 

on the clarity of the proposed 

regulations and how they may be made 

easier to understand. All comments will 

be available for public inspection and 

copying. A public hearing will be 

scheduled if requested in writing by any 

person that timely submits written 

comments. If a public hearing is 

scheduled, notice of the date, time, and 

place for the public hearing will be 

published in the Federal Register. 

Drafting Information 

The principal author of these 

regulations is Carolyn Zimmerman, IRS 

Employee Plans, Tax Exempt and 

Government Entities Division. However, 

other personnel from the Joint Board 

and the IRS participated in their 

development. 

List of Subjects in 20 CFR Part 901 

Regulations Governing the 

Performance of Actuarial Services under 

the Employee Retirement Income 

Security Act of 1974. 

Proposed Amendments to the 

Regulations 

Accordingly, 20 CFR part 901 is 

proposed to be amended as follows: 

PART 901—REGULATIONS 

GOVERNING THE PERFORMANCE OF 

ACTUARIAL SERVICES UNDER THE 

EMPLOYEE RETIREMENT INCOME 

SECURITY ACT OF 1974 

Paragraph 1. The authority citation 

for part 901 continues to read in part as 

follows: 

Authority: These rules are issued under 

authority of 88 Stat. 1002; 29 U.S.C. 1241, 

1242. See also 5 U.S.C. 301; 31 U.S.C. 330; 

and 31 U.S.C. 321. 

Par. 2. Section 901.0 is amended by 

revising the second sentence to read as 

follows: 

§ 901.0 Scope. 

* * * Subpart A of this part sets forth 

definitions and eligibility to perform 

actuarial services; subpart B of this part 

sets forth rules governing the enrollment 

of actuaries; subpart C of this part sets 

forth standards of performance to which 

enrolled actuaries must adhere; subpart 

D of this part sets forth rules applicable 

to suspension and termination of 

enrollment; and subpart E of this part 

sets forth general provisions. 

Par. 3. Section 901.1 is amended by: 

A. Adding new paragraph (d)(5). 

B. Revising paragraph (g). 

C. Adding new paragraphs (i), (j) and 

(k). 

The revisions and additions read as 

follows: 

§ 901.1 Definitions. 

* * * * * 

(d) * * * 

(5) Selection of assumptions. 

* * * * * 

(g) Enrolled actuary means an 

individual who has satisfied the 

standards and qualifications set forth in 

this part and who has been approved by 

the Joint Board for the Enrollment of 

Actuaries (the Joint Board), or its 

designee, to perform actuarial services 

required under ERISA or the 

regulations. 

* * * * * 

(i) Certified responsible actuarial 

experience means responsible actuarial 

experience of an individual that has 

been certified in writing by the 

individual’s supervisor. 

(j) Certified responsible pension 

actuarial experience means responsible 

pension actuarial experience of an 

individual that is certified in writing by 

the individual’s supervisor if the 

supervisor is an enrolled actuary. If the 

individual’s supervisor is not an 

enrolled actuary, the pension actuarial 

experience must be certified in writing 

by both the supervisor and an enrolled 

actuary with knowledge of the 

individual’s pension actuarial 

experience. 

(k) Enrollment cycle means the three 

year period from January 1, 2011, to 

December 31, 2013, and every three-year 

period thereafter. 

Par. 4. Section 901.10 is amended by 

revising paragraph (a) to read as follows: 

§ 901.10 Application for enrollment. 

(a) Form. As a requirement for 

enrollment, an applicant shall file with 

the Executive Director of the Joint Board 

(the Executive Director) a properly 

executed application on a form or forms 

specified by the Joint Board, and shall 

agree to comply with these regulations 

and any other guidance as required by 

the Joint Board. A reasonable nonrefundable fee may be charged for each 

application for enrollment filed. 

* * * * * 


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Par. 5. Section 901.11 is amended by: 

A. Revising the first sentence of 

paragraph (a). 

B. Revising paragraphs (c) and (d). 

C. Revising paragraphs (e) 

introductory text, (e)(1) and (e)(2)(i). 

D. Revising the last sentence of 

paragraph (e)(2)(ii). 

E. Adding new paragraphs (e)(2)(iv), 

(v), and (vi). 

F. Removing paragraph (e)(3). 

G. Revising paragraphs (f)(1) 

introductory text, and (f)(1)(i). 

H. Revising the second sentence of 

paragraph (f)(1)(ii), and paragraph 

(f)(1)(iv). 

I. Revising paragraph (f)(2). 

J. Adding paragraph (f)(3). 

K. Revising paragraph (g). 

L. Removing the last two sentences of 

paragraph (h)(2). 

M. Removing paragraph (l). 

N. Redesignating paragraphs (i), (j), 

and (k) as paragraphs (j), (k), and (l), 

respectively. 

O. Adding and reserving new 

paragraph (i). 

P. Revising newly redesignated 

paragraphs (j) and (k). 

Q. Revising the first sentences of 

newly redesignated paragraphs (l)(1) 

and (l)(2), and the second sentence of 

newly redesignated paragraph (l)(3). 

R. Revising newly redesignated 

paragraphs (l)(4), (l)(5), (l)(6), and (l)(7), 

and the first sentence of newly 

redesignated paragraph (l)(9). 

S. Revising paragraph (n). 

T. Adding new paragraphs (o) and (p). 

The revisions and additions read as 

follows: 

§ 901.11 Enrollment procedures. 

(a) Enrollment. The Joint Board shall 

enroll each applicant it determines has 

met the requirements of these 

regulations, and any other guidance as 

required by the Joint Board, and shall so 

notify the applicant. * * * 

* * * * * 

(c) Rosters. The Executive Director 

shall maintain rosters of all actuaries 

who are duly enrolled under this part 

and of all individuals whose enrollment 

has been suspended or terminated, or 

who are in inactive status. The 

Executive Director may publish any or 

all of these rosters, including display on 

the Joint Board’s Web site, to the extent 

permitted by law. 

(d) Renewal of enrollment. To 

maintain active enrollment to perform 

actuarial services under ERISA, each 

enrolled actuary is required to have his/ 

her enrollment renewed as set forth 

herein. 

(1) All enrolled actuaries must file an 

application for renewal of enrollment on 

the prescribed form between October 1, 

2010, and March 1, 2011, and between 

October 1 and March 1 of every third 

year thereafter. 

(2) The effective date of renewal of 

enrollment for individuals who file 

complete renewal applications by 

March 1 is the April 1 immediately 

following the date of application. The 

effective date of renewal of enrollment 

for individuals who file complete 

renewal applications after March 1 is 

the date the notice of renewal is mailed 

to that individual by the Joint Board. 

(3) Forms required for renewal may be 

obtained from the Executive Director. 

(4) A reasonable non-refundable fee 

may be charged for each application for 

renewal of enrollment filed. 

(e) Condition for renewal: Continuing 

professional education. To qualify for 

renewal of enrollment, an enrolled 

actuary must certify, on the form 

prescribed by the Executive Director, 

that he/she has completed the 

applicable minimum number of hours of 

continuing education credit required by 

this paragraph (e) and satisfied the 

recordkeeping requirements of 

paragraph (j) of this section. 

(1) Transition rule for renewal of 

enrollment effective April 1, 2011. (i) A 

minimum of 36 hours of continuing 

education credit must be completed 

between January 1, 2008 and December 

31, 2010. Of the 36 hours, at least 18 

must consist of core subject matter; the 

remainder may be non-core subject 

matter. 

(ii) An individual who receives initial 

enrollment in 2008 or 2009 must satisfy 

the following requirements by December 

31, 2010: Those enrolled during 2008 

must complete 24 hours of continuing 

education; those enrolled during 2009 

must complete 12 hours of continuing 

education. At least one-half of the 

applicable hours must consist of core 

subject matter; the remainder may 

consist of non-core subject matter. For 

purposes of this paragraph (e), credit 

will be awarded for continuing 

education completed after January 1 of 

the year in which initial enrollment was 

received. 

(iii) An individual who receives 

initial enrollment during 2010 is exempt 

from the continuing education 

requirements until the next enrollment 

cycle, but must file a timely application 

for renewal. 

(2) For renewal of enrollment effective 

April 1, 2014, and every third year 

thereafter. (i) A minimum of 36 hours of 

continuing education credit must be 

completed between January 1, 2011 and 

December 31, 2013, and between 

January 1 and December 31 for each 

three year period subsequent thereto. 

(ii) * * * For purposes of this 

paragraph (e), credit will be awarded for 

continuing education completed after 

January 1 of the year in which initial 

enrollment was received. 

* * * * * 

(iv) For an individual who was 

initially enrolled before January 1, 2008 

(and who has therefore completed at 

least one full enrollment cycle as of 

January 1, 2011), at least 12 hours of the 

36 hours of continuing education 

required for each enrollment cycle must 

consist of core subject matter; the 

remainder may consist of non-core 

subject matter. 

(v) For an individual who was 

initially enrolled on or after January 1, 

2008, at least 18 hours of his or her 36 

hours of continuing education required 

for the first full enrollment cycle must 

consist of core subject matter. 

Thereafter, for such individuals, for 

each subsequent enrollment cycle at 

least 12 hours of the 36 hours must 

consist of core subject matter. In each 

instance, the remainder may consist of 

non-core subject matter. 

(vi) As part of the core subject matter 

required for each enrollment cycle, an 

individual must complete a minimum of 

two hours of continuing education 

credit relating to ethical standards. 

(f) Qualifying continuing education— 

(1) In general. To qualify for continuing 

education credit an enrolled actuary 

must complete his/her hours of 

continuing education credit under a 

qualifying program, within the meaning 

of paragraph (f)(2) of this section, 

consisting of core and/or non-core 

subject matter. In addition, a portion of 

the continuing education credit may be 

earned under the provisions of 

paragraph (g) of this section. In any 

event, no less than 1⁄3 of the total hours 

of continuing education credit required 

for an enrollment cycle must be 

obtained by attending in person a formal 

program or programs, within the 

meaning of paragraph (f)(2)(ii)(A) of this 

section. 

(i) Core subject matter is program 

content and knowledge that is integral 

and necessary to the satisfactory 

performance of pension actuarial 

services and actuarial certification 

under ERISA and the Internal Revenue 

Code. Such core subject matter includes 

the characteristics of actuarial cost 

methods under ERISA, actuarial 

assumptions, minimum funding 

standards, titles I, II, and IV of ERISA, 

requirements with respect to the 

valuation of plan assets, requirements 

for qualification of pension plans, 

maximum deductible contributions, tax 

treatment of distributions from qualified 


srobinson on DSKHWCL6B1PROD with PROPOSALS
48038 Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 

pension plans, excise taxes related to 

the funding of qualified pension plans 

and standards of performance 

(including ethical standards) for 

actuarial services. Core subject matter 

includes all materials included on the 

syllabi of any of the pension actuarial 

examinations offered by the Joint Board 

during the applicable enrollment cycles. 

For this purpose, the applicable 

enrollment cycles are the current 

enrollment cycle and the enrollment 

cycle immediately preceding the current 

enrollment cycle. 

(ii) * * * Examples include 

economics, computer programming, 

pension accounting, investment and 

finance, risk theory, communication 

skills, and business and general tax law. 

* * * * * 

(iv) The same course of study cannot 

be used more than once within a given 

36-month period to satisfy the 

continuing education requirements of 

these regulations. A program or session 

bearing the same or a similar title to a 

previous one may be used to satisfy the 

requirements of these regulations if the 

major content of the program or session 

differs substantively from the previous 

one. 

(2) Qualifying Program—(i) In general. 

A qualifying program is a course of 

learning that— 

(A) Is conducted by a qualified 

sponsor, within the meaning of 

paragraph (f)(3) of this section; 

(B) Is developed by individual(s) 

qualified in the subject matter; 

(C) Covers current subject matter; 

(D) Includes written outlines or 

textbooks; 

(E) Is taught by instructors, discussion 

leaders, and speakers qualified with 

respect to the course content; 

(F) Includes means for evaluation by 

the Joint Board of technical content and 

presentation; 

(G) Provides a certificate of 

completion, within the meaning of 

paragraph (f)(3)(iv) of this section, to 

those who have successfully completed 

the program; and 

(H) Provides a certificate of 

instruction, within the meaning of 

paragraph (f)(3)(v) of this section, to 

those who have served as instructors, 

discussion leaders, or speakers. 

(ii) Types of qualifying programs. 

Qualifying programs may be formal 

programs, correspondence or individual 

study programs, and teleconferencing: 

(A) Formal programs. Formal 

programs are programs that meet all of 

the requirements of paragraph (f)(2)(i) of 

this section and also require physical 

attendance by at least three individuals 

engaged in substantive pension service 

in addition to the instructor, discussion 

leader, or speaker. 

(B) Correspondence or individual 

study programs (including audio and/or 

video taped programs). Correspondence 

or individual study programs are 

programs completed on an individual 

basis by the enrolled actuary. Such 

programs are qualifying programs if they 

meet all of the requirements of 

paragraph (f)(2)(i) of this section and 

also provide a means for measuring 

completion by the participants (for 

example, a written examination). 

(C) Teleconferencing. 

Teleconferencing or other 

communications technologies 

(including webcasting) are qualifying 

programs if they meet all of the 

requirements under paragraph (f)(2)(i) of 

this section and either— 

(1) Include a sign-on/sign-off capacity 

or similar technique to verify 

attendance; or 

(2) Provide a means for measuring 

completion by the participants (for 

example, a written examination). 

(3) Qualifying sponsors—(i) In 

general. Qualifying sponsors are 

organizations recognized by the 

Executive Director whose programs offer 

opportunities for continuing 

professional education in subject matter 

within the scope of this section. A sole 

proprietor shall not be treated as a 

qualifying sponsor for purposes of this 

section. 

(ii) Sponsor agreements. 

Organizations requesting qualifying 

sponsor status shall file sponsor 

agreement requests with the Executive 

Director and furnish information in 

support of such requests as deemed 

necessary for approval by the Executive 

Director. Such information shall include 

sufficient information to establish that 

all programs designated as qualifying 

programs offered by the qualifying 

sponsor will satisfy the requirements of 

paragraph (f)(2) of this section. 

(iii) Sponsor enrollment cycle. 

Qualifying sponsor agreements will 

remain in effect for no more than one 

sponsor enrollment cycle. The 

Executive Director shall publish the 

names of such sponsors on a periodic 

basis. 

(A) For sponsor agreements effective 

on or after January 1, 2008, and before 

January 1, 2012, the applicable sponsor 

enrollment cycle will end December 31, 

2011. 

(B) For sponsor agreements effective 

on or after January 1, 2012, the 

applicable sponsor enrollment cycle 

will be three years and will begin on 

January 1 and end on December 31 at 

the end of the three year period. Each 

such three year period is a ‘‘sponsor 

enrollment cycle.’’ The sponsor 

enrollment cycle is not affected by when 

during the enrollment cycle the sponsor 

agreement became effective. For 

example, for sponsor agreements 

effective on or after January 1, 2012 and 

before January 1, 2015, the applicable 

sponsor enrollment cycle will end 

December 31, 2014. The subsequent 

sponsor enrollment cycle will begin 

January 1, 2015, and end December 31, 

2017. 

(iv) Certificates of completion. 

Qualifying sponsors shall furnish to 

each attendee successfully completing a 

program presented by such qualifying 

sponsor a certificate listing the 

following information: 

(A) The name of the attendee. 

(B) The name of the sponsoring 

organization. 

(C) The title, location, and speaker(s) 

of each session attended. 

(D) The dates of the program 

completed. 

(E) The total credit hours claimed and 

the total core and non-core credit hours 

claimed. 

(v) Certificates of instruction. 

Qualifying sponsors shall furnish to 

each instructor, discussion leader, or 

speaker, a certificate listing the 

following information: 

(A) The name of the instructor, 

discussion leader, or speaker. 

(B) The name of the sponsoring 

organization. 

(C) The title and location of the 

program. 

(D) The dates of the program. 

(E) The total credit hours claimed and 

the total core and non-core credit hours 

claimed for the program. 

(g) Alternative means for completion 

of credit hours—(1) In general. In 

addition to credit hours completed 

under paragraph (f) of this section, an 

enrolled actuary may be awarded 

continuing education credit under the 

provisions of this paragraph (g). 

(2) Serving as an instructor, 

discussion leader or speaker. (i) Four 

credit hours (that is, 200 minutes) of 

continuing education credit will be 

awarded for each 50 minutes completed 

as an instructor, discussion leader, or 

speaker at a qualifying program which 

meets the continuing education 

requirements of paragraph (f) of this 

section. 

(ii) The credit for instruction and 

preparation may not exceed 50 percent 

of the continuing education requirement 

for an enrollment cycle. 

(iii) Presentation of the same material 

as an instructor, discussion leader, or 

speaker more than one time in any 36- 

month period will not qualify for 

continuing education credit. A program 


srobinson on DSKHWCL6B1PROD with PROPOSALS
Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 48039 

will not be considered to consist of the 

same material if a substantial portion of 

the content has been revised to reflect 

changes in the law or practices relative 

to the performance of pension actuarial 

service. 

(iv) Credit as an instructor, discussion 

leader, or speaker will not be awarded 

to panelists, moderators, or others who 

are not required to prepare substantive 

subject matter for their portion of the 

program. However, such individuals 

may be awarded credit for attendance, 

provided the other provisions of this 

section are met. 

(v) The nature of the subject matter 

will determine if credit will be of a core 

or non-core nature. 

(3) Credit for publications. (i) 

Continuing education credit will be 

awarded for the creation of peerreviewed materials for publication or 

distribution with respect to matters 

directly related to the continuing 

professional education requirements of 

this section. Credit will be awarded to 

the author, co-author, or a person listed 

as a major contributor. 

(ii) One hour of credit will be allowed 

for each hour of preparation time of the 

material. It will be the responsibility of 

the person claiming the credit to 

maintain records to verify preparation 

time. 

(iii) Publication or distribution may 

utilize any available technology for the 

dissemination of written, visual or 

auditory materials. 

(iv) The materials must be available 

on reasonable terms for acquisition and 

use by all enrolled actuaries. 

(v) The credit for the creation of 

materials may not exceed 25 percent of 

the continuing education requirement of 

any enrollment cycle. 

(vi) The nature of the subject matter 

will determine if credit will be of a core 

or non-core nature. 

(vii) Publication of the same material 

more than one time will not qualify for 

continuing education credit. A 

publication will not be considered to 

consist of the same material if a 

substantial portion has been revised to 

reflect changes in the law or practices 

relative to the performance of pension 

actuarial service. 

(4) Service on Joint Board advisory 

committee(s). Continuing education 

credit may be awarded by the Joint 

Board for service on (any of) its advisory 

committee(s), to the extent that the Joint 

Board considers warranted by the 

service rendered. 

(5) Preparation of Joint Board 

examinations. Continuing education 

credit may be awarded by the Joint 

Board for participation in drafting 

questions for use on Joint Board 

examinations or in pretesting its 

examinations, to the extent the Joint 

Board determines suitable. Such credit 

may not exceed 50 percent of the 

continuing professional education 

requirement for the applicable 

enrollment cycle. 

(6) Examinations sponsored by 

professional organizations or societies. 

Individuals may earn continuing 

professional education credit for 

achieving a passing grade on proctored 

examinations sponsored by a 

professional organization or society 

recognized by the Joint Board. Such 

credit is limited to the number of hours 

scheduled for each examination and 

may be applied only as non-core credit 

provided the content of the examination 

is core or non-core. No credit may be 

earned for hours attributable to any 

content that is neither core nor noncore. 

(7) Joint Board pension examination. 

Individuals may establish eligibility for 

renewal of enrollment for any 

enrollment cycle by— 

(i) Achieving a passing score on the 

Joint Board pension examination, as 

described in § 901.12(d)(1)(i), 

administered under this part during the 

applicable enrollment cycle; and 

(ii) Completing a minimum of 12 

hours of qualifying continuing 

education by attending a formal 

program during the same applicable 

enrollment cycle. This option of 

satisfying the continuing professional 

education requirements is not available 

to those who receive initial enrollment 

during the enrollment cycle. 

* * * * * 

(i) [Reserved] 

(j) Recordkeeping requirements—(1) 

Qualified sponsors. A qualified sponsor 

must maintain records to verify 

satisfaction of the requirements of this 

section. Such records must be retained 

for a period of six years following the 

end of the sponsor enrollment cycle in 

which the program is held. In the case 

of programs of more than one session, 

records must be maintained to verify 

completion of the program and 

attendance by each participant at each 

session of the program. Copies of any 

certificates of completion and 

certificates of instruction issued to the 

participants in each program must be 

retained. 

(2) Enrolled actuaries—(i) Qualifying 

program credits as student. To receive 

continuing education credit for 

completion of hours of continuing 

education credits under paragraph (f) of 

this section, an enrolled actuary must 

retain all certificates of completion 

evidencing completion of such hours for 

the three-year period following the end 

of the applicable enrollment cycle. 

(ii) Qualifying program credits as 

teacher or instructor. To receive 

continuing education credit for 

completion of hours earned under 

paragraph (g)(2) of this section, an 

enrolled actuary must retain all 

certificates of instruction evidencing 

completion of such hours for the three 

year period following the end of the 

applicable enrollment cycle. 

(iii) Credit for publications. To receive 

continuing education credit for a 

publication under paragraph (g)(3) of 

this section, the following information 

must be maintained by the enrolled 

actuary for the three year period 

following the end of the applicable 

enrollment cycle: 

(A) The name of the publisher. 

(B) The title and author of the 

publication. 

(C) A copy of the publication. 

(D) The date of the publication. 

(E) The total credit hours claimed and 

the total core and non-core credit hours 

claimed. 

(iv) Other credits. To receive 

continuing education credit for hours 

earned under paragraphs (g)(4) through 

(g)(7) of this section, an enrolled actuary 

must retain sufficient documentation to 

establish completion of such hours for 

the three-year period following the end 

of the applicable enrollment cycle. 

(k) Waivers. (1) Waiver from the 

continuing education requirements for a 

given period may be granted by the 

Executive Director only under 

extraordinary circumstances, and upon 

submission of sufficient evidence that 

every effort was made throughout the 

renewal cycle to complete such 

continuing education requirements 

through any one or more of the various 

qualifying programs offered by one or 

more of the qualified sponsors. 

(2) A request for waiver must be 

accompanied by appropriate 

documentation. The individual will be 

required to furnish any additional 

documentation or explanation deemed 

necessary by the Executive Director. 

(3) The individual will be notified by 

the Executive Director of the disposition 

of the request for waiver. If the waiver 

is not approved, and the individual does 

not otherwise satisfy the continuing 

education requirements within the 

allotted time, the individual will be 

placed on a roster of inactive enrolled 

individuals. 

(4) A request for waiver must be filed 

no later than the last day of the renewal 

application period. Those who are 

granted waivers are required to file 

timely applications for future renewal of 

enrollment. 


srobinson on DSKHWCL6B1PROD with PROPOSALS
48040 Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 

(l) * * * (1) Compliance by an 

individual with the requirements of this 

part shall be determined by the 

Executive Director. * * * 

(2) The Executive Director may 

require any individual, by first class 

mail sent to his/her mailing address of 

record with the Joint Board, to provide 

copies of any records required to be 

maintained under this section. * * * 

(3) * * * A request for review and the 

reasons in support of the request must 

be filed with the Joint Board within 30 

days of the date of the notice of failure 

to comply. 

(4) Inactive status. (i) An individual 

who has not filed a timely application 

for renewal of enrollment, who has not 

made a timely response to the notice of 

failure to comply with the renewal 

requirements, or who has not satisfied 

the requirements of eligibility for 

renewal will be placed on a roster of 

inactive enrolled actuaries for a period 

up to three enrollment cycles from the 

date renewal would have been effective. 

(ii) An individual in inactive status 

will be ineligible to perform pension 

actuarial services as an enrolled actuary 

under ERISA and the Internal Revenue 

Code. During such time in inactive 

status or at any other time an individual 

is ineligible to perform pension 

actuarial services as an enrolled actuary, 

the individual shall not in any manner, 

directly or indirectly, indicate he or she 

is so enrolled, or use the term ‘‘enrolled 

actuary,’’ the designation ‘‘E.A.,’’ or 

other form of reference to eligibility to 

perform pension actuarial services as an 

enrolled actuary. 

(iii) An individual placed in inactive 

status may return to active status by 

filing an application for renewal of 

enrollment (with the appropriate fee) 

and providing evidence of the 

completion of all required continuing 

professional education hours for the 

enrollment cycle and satisfaction of any 

applicable requirements for qualifying 

experience under paragraph (l)(7) of this 

section. If an application for return to 

active status is approved, the individual 

will be eligible to perform services as an 

enrolled actuary and to practice before 

the Internal Revenue Service effective 

with the date the notice of approval is 

mailed to that individual by the Joint 

Board. 

(5) Time for return to active 

enrollment. (i) An individual placed in 

inactive status must file an application 

for return to active enrollment, and 

satisfy the requirements for return to 

active enrollment as set forth in this 

section, within three enrollment cycles 

of being placed in inactive status. The 

name of such individual otherwise will 

be removed from the inactive 

enrollment roster and his/her 

enrollment will terminate. 

(ii) For purposes of paragraph (l)(5)(i) 

of this section, an individual placed in 

inactive status prior to the effective date 

of these regulations will be deemed to 

have been placed in inactive status on 

the effective date of these regulations. 

(6) An individual placed in inactive 

status may satisfy the requirements for 

return to active enrollment at any time 

during his/her period of inactive 

enrollment. If only completion of the 

continuing education requirement is 

necessary, the application for return to 

active enrollment may be filed 

immediately upon such completion. If 

qualifying experience is also required, 

the application for return to active 

enrollment may not be filed until the 

completion of both the continuing 

education and qualifying experience 

requirements set forth in this 

subsection. Continuing education credit 

under this subsection may not be used 

to satisfy the requirements of the 

enrollment cycle in which the 

individual has been placed back on the 

active roster. 

(7) Continuing education 

requirements for return to active 

enrollment from inactive status. (i) 

During the first inactive enrollment 

cycle: 36 hours of the qualifying 

continuing education requirement from 

the prior enrollment cycle as set forth in 

paragraph (e)(2) of this section, without 

regard to paragraph (e)(2)(ii) or (e)(2)(iii) 

of this section, must be completed. Any 

hours of continuing education credit 

from the immediately prior enrollment 

cycle may be applied in satisfying this 

requirement. 

(ii) During the second inactive 

enrollment cycle: Four-thirds of the 

qualifying continuing education 

requirements as set forth in paragraph 

(e)(2) of this section (that is, 48 hours), 

without regard to paragraph (e)(2)(ii) or 

(e)(2)(iii) of this section, plus eighteen 

months of the qualifying experience 

requirements set forth in § 901.12(b)(1), 

must be completed since the start of the 

first inactive enrollment cycle. Any 

hours of continuing education credit 

from the first inactive enrollment cycle 

may be applied in satisfying this 

requirement. 

(iii) During the third inactive 

enrollment cycle: Five-thirds of the 

qualifying continuing education 

requirements as set forth in paragraph 

(e)(2) of this section, (that is, 60 hours), 

without regard to paragraph (e)(2)(ii) or 

(e)(2)(iii) of this section plus eighteen 

months of the qualifying experience 

requirements set forth in § 901.12(b)(1), 

must be completed since the start of the 

second inactive enrollment cycle. Any 

hours of continuing education credit 

from the second inactive enrollment 

cycle may be applied in satisfying this 

requirement. No hours from the first 

inactive enrollment cycle may be 

applied in satisfying this requirement. 

* * * * * 

(9) An individual who has certified in 

good faith that he/she has satisfied the 

continuing education requirements of 

this section will not be considered to be 

in non-compliance with such 

requirements on the basis of a program 

he/she has attended later being found 

inadequate or not in compliance with 

the requirements for continuing 

education. * * * 

* * * * * 

(n) Verification. The Executive 

Director or his/her designee may request 

and review the continuing education 

records of an enrolled actuary, 

including programs attended, in a 

manner deemed appropriate to 

determine compliance with the 

requirements and standards for the 

renewal of enrollment as provided in 

this section. The Executive Director may 

also request and review the records of 

any qualified sponsor in a manner 

deemed appropriate to determine 

compliance with the requirements of 

paragraphs (f)(3) and (j)(1) of this 

section. 

(o) Examples. The following examples 

illustrate the application of the rules of 

paragraph (l)(7) of this section: 

Example 1. (i) Individual E, who was 

initially enrolled before January 1, 2008, 

completes 5 hours of core continuing 

education credit and 10 hours of non-core 

continuing education credit between January 

1, 2011, and December 31, 2013. 

Accordingly, effective April 1, 2014, E is 

placed on a roster of inactive enrolled 

actuaries and is ineligible to perform pension 

actuarial services as an enrolled actuary 

under ERISA and the Internal Revenue Code. 

(ii) E completes 7 hours of core continuing 

education credit and 14 hours of noncore 

continuing education credit between January 

1, 2014, and May 24, 2016. Because E has 

completed 12 hours of core continuing 

education and 24 hours of non-core 

continuing education during the last active 

enrollment period and the initial period 

when on inactive status, E has satisfied the 

requirements for reenrollment during the first 

inactive cycle. Accordingly, E may file an 

application for return to active enrollment on 

May 24, 2016. If this application is approved, 

E will be eligible to perform pension 

actuarial services as an enrolled actuary 

under ERISA and the Internal Revenue Code, 

effective with the date of such approval. 

(iii) Because E used the 21 hours of 

continuing education credit earned after 

January 1, 2014, for return from inactive 

status, E may not apply any of these 21 hours 

of core and non-core continuing education 

credits towards the requirements for renewed 


srobinson on DSKHWCL6B1PROD with PROPOSALS
Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 48041 

enrollment effective April 1, 2017. 

Accordingly, E must complete an additional 

36 hours of continuing education (12 core 

and 24 non-core) prior to December 31, 2016, 

to be eligible for renewed enrollment 

effective April 1, 2017. 

Example 2. (i) The facts are the same as in 

Example 1 except E completes 2 hours of 

core continuing education credit and 8 hours 

of non-core continuing education credit 

between January 1, 2014, and December 31, 

2016. Thus, because E did not fulfill the 

requirements for return to active status 

during his first inactive cycle, E must satisfy 

the requirements of paragraph (l)(7)(ii) of this 

section in order to return to active status. 

(ii) Accordingly, in order to be eligible to 

file an application for return to active status 

on or before December 31, 2019, E must 

complete an additional 38 hours of 

continuing education credit (of which at least 

14 hours must consist of core subject matter) 

between January 1, 2017, and December 31, 

2019, and have 18 months of responsible 

pension actuarial experience during the 

period subsequent to December 31, 2013. 

(iii) Note that the 5 hours of core 

continuing education credit and the 10 hours 

of non-core continuing education credit that 

E completes between January 1, 2011, and 

December 31, 2013, are not counted toward 

E’s return to active status and are also not 

taken into account toward the additional 

hours of continuing education credit that E 

must complete between January 1, 2017, and 

December 31, 2019, in order to apply for 

renewal of enrollment effective April 1, 2020. 

Example 3. (i) The facts are the same as in 

Example 1 except E completes 2 hours of 

core continuing education credit and 8 hours 

of non-core continuing education credit 

between January 1, 2014, and December 31, 

2016, and 12 hours of core continuing 

education credit and 24 hours of non-core 

continuing education credit between January 

1, 2017, and December 31, 2019. Thus, 

because E did not fulfill the requirements for 

return to active status during his first or 

second inactive cycles, E must satisfy the 

requirements of paragraph (l)(7)(iii) of this 

section in order to return to active status. 

(ii) Accordingly, in order to be eligible to 

file an application for return to active status 

on or before December 31, 2022, E must 

complete an additional 24 hours of 

continuing education credit (of which, at 

least 8 hours must consist of core subject 

matter) between January 1, 2020, and 

December 31, 2022, and have at least 18 

months of responsible pension actuarial 

experience during the period subsequent to 

December 31, 2016. 

(iii) Note that the total of 15 hours of 

continuing education credit that E completes 

between January 1, 2011, and December 31, 

2013, as well as the 10 hours of continuing 

education credit between January 1, 2014, 

and December 31, 2016, are not counted 

toward E’s return to active status and are not 

taken into account toward the additional 

hours of continuing education credit that E 

must complete between January 1, 2020, and 

December 31, 2022, in order to be eligible to 

file an application for renewal of enrollment 

active status effective April 1, 2023. 

Example 4. (i) Individual F, who was 

initially enrolled July 1, 2012, completes 1 

hour of core continuing education credit and 

2 hours of non-core continuing education 

credit between January 1, 2012, and 

December 31, 2013. Accordingly, effective 

April 1, 2014, F is placed on a roster of 

inactive enrolled actuaries and is ineligible to 

perform pension actuarial services as an 

enrolled actuary under ERISA and the 

Internal Revenue Code. 

(ii) F completes 5 hours of core continuing 

education credit and 4 hours of non-core 

continuing education credit between January 

1, 2014, and October 6, 2014. Because F has 

not completed the required 6 hours of core 

and 6 hours of non-core continuing 

education during F’s initial enrollment cycle, 

F is not eligible to file an application for a 

return to active enrollment on October 6, 

2014, notwithstanding the fact that had F 

completed such hours between January 1, 

2012, and December 31, 2013, F would have 

satisfied the requirements for renewed 

enrollment effective April 1, 2014. 

(iii) Accordingly, F must complete an 

additional 24 hours of continuing education 

(12 hours of core and 12 hours of non-core) 

during his/her first inactive enrollment cycle 

before applying for renewal of enrollment. 

Example 5. The facts are the same as in 

Example 4 except that F completes 17 hours 

of core continuing education credit and 16 

hours of non-core continuing education 

credit between January 1, 2014, and February 

12, 2015. Accordingly, because as of 

February 12, 2015, F satisfied the continuing 

education requirements as set forth in 

paragraph (e)(2) of this section without 

regard to paragraph (e)(2)(ii) thereof, F may 

file an application for return to active 

enrollment status on February 12, 2015. 

(p) With the exception of paragraphs 

(e)(1) and (f)(3)(iii), this section applies 

to the enrollment cycle beginning 

January 1, 2008, and all subsequent 

enrollment cycles. 

§ 901.12 [Removed] 

Par. 6. Section 901.12 is removed. 

§ 901.13 [Redesignated as § 901.12] 

Par. 7. Section 901.13 is redesignated 

as § 901.12. 

Par 8. Newly redesignated § 910.12 is 

amended by revising the section 

heading and paragraphs (a), (b), (d), and 

(e). 

The revisions read as follows: 

§ 901.12 Eligibility for enrollment. 

(a) In general. An individual applying 

to be an enrolled actuary must fulfill the 

experience requirement of paragraph (b) 

of this section, the basic actuarial 

knowledge requirement of paragraph (c) 

of this section, and the pension actuarial 

knowledge requirement of paragraph (d) 

of this section. 

(b) Qualifying experience. Within the 

10-year period immediately preceding 

the date of application, the applicant 

shall have completed either— 

(1) A minimum of 36 months of 

certified responsible pension actuarial 

experience; or 

(2) A minimum of 60 months of 

certified responsible actuarial 

experience, including at least 18 months 

of certified responsible pension 

actuarial experience. 

* * * * * 

(d) Pension actuarial knowledge. (1) 

The applicant shall demonstrate 

pension actuarial knowledge by one of 

the following: 

(i) Joint Board pension examination. 

Successful completion, within the 10- 

year period immediately preceding the 

date of the application, to a score 

satisfactory to the Joint Board, of an 

examination, prescribed by the Joint 

Board, in actuarial mathematics and 

methodology relating to pension plans, 

including the provisions of ERISA 

relating to the minimum funding 

requirements and allocation of assets on 

plan termination. 

(ii) Organization pension 

examinations. Successful completion, 

within the 10-year period immediately 

preceding the date of the application, to 

a score satisfactory to the Joint Board, of 

one or more proctored examinations 

which are given by an actuarial 

organization and which the Joint Board 

has determined cover substantially the 

same subject areas, have at least a 

comparable level of difficulty, and 

require at least the same competence as 

the Joint Board pension examination 

referred to in paragraph (d)(1)(i) of this 

section. 

(2) For purposes of this section, 

applicants who have successfully 

completed an examination pursuant to 

either paragraph (d)(1)(i) or (d)(1)(ii) of 

this section prior to the effective date of 

these regulations, will be deemed to 

have completed such examination on 

the effective date. 

(e) Form; fee. An applicant who 

wishes to take an examination 

administered by the Joint Board under 

paragraph (c)(1) or (d)(1) of this section 

shall file an application on a form 

prescribed by the Joint Board. Such 

application shall be accompanied by 

payment in the amount set forth on the 

application form. The amount 

represents a fee charged to each 

applicant for examination and is 

designed to cover the costs for the 

administration of the examination. The 

fee shall be retained whether or not the 

applicant successfully completes the 

examination or is enrolled. 

* * * * * 

Par. 9. Section 901.20 is amended as 

follows: 

A. Revising paragraphs (b), (d), (e), 

and (f). 

B. Redesignating paragraphs (g) and 

(h) as paragraph (k) and (l), respectively, 

and adding new paragraphs (g) and (h). 


srobinson on DSKHWCL6B1PROD with PROPOSALS
48042 Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 

C. Reserving paragraph (i). 

D. Adding new paragraphs (j) and (m). 

The revisions and additions read as 

follows: 

§ 901.20 Standards of performance of 

actuarial services. 

* * * * * 

(b) Professional duty. (1) An enrolled 

actuary shall perform actuarial services 

only in a manner that is fully in 

accordance with all of the duties and 

requirements for such persons under 

applicable law and consistent with 

relevant standards of professional 

responsibility and ethics for actuarial 

practice. 

(2) An enrolled actuary shall not 

perform actuarial services for any 

person or organization which he/she 

believes, or has reasonable grounds to 

believe, may utilize his/her services in 

a fraudulent manner or in a manner 

inconsistent with law. 

(3) An enrolled actuary, upon learning 

of another enrolled actuary’s material 

violation of this section, shall report the 

violation to the Executive Director. 

* * * * * 

(d) Conflicts of interest. In any 

situation in which an enrolled actuary 

has knowledge of an actual or potential 

conflict of interest with respect to the 

performance of actuarial services, he/ 

she shall not perform such actuarial 

services unless— 

(1) He/she has conducted a good faith 

evaluation of the circumstances giving 

rise to the conflict and reasonably 

concludes that his or her ability to act 

fairly is unimpaired; 

(2) The representation by the enrolled 

actuary is not prohibited by law; and 

(3) Full disclosure of the conflict has 

been made, in writing, to all present and 

known prospective principals whose 

interest would be affected by the 

conflict, including the plan trustees, any 

named fiduciary of the plan, the plan 

administrator thereof and, if the plan is 

subject to a collective bargaining 

agreement, the collective bargaining 

representative, and all such principals 

have expressly agreed, in writing, to 

such enrolled actuary performing the 

actuarial services. 

(e) Assumptions, calculations and 

recommendations. (1) The enrolled 

actuary shall exercise due care, skill, 

prudence and diligence when 

performing actuarial services under 

ERISA and the Internal Revenue Code. 

In particular, in the course of preparing 

a report or certificate stating actuarial 

costs or liabilities, the enrolled actuary 

shall ensure that— 

(i) The actuarial assumptions are 

reasonable individually and in 

combination, and the actuarial cost 

method and the actuarial method of 

valuation of assets are appropriate; 

(ii) The calculations are accurately 

carried out and properly documented; 

and 

(iii) The report, any 

recommendations, and any 

supplemental advice or explanation 

relative to the report reflect the results 

of the calculations. 

(2) An enrolled actuary shall include 

in any report or certificate stating 

actuarial costs or liabilities, a statement 

or reference describing or clearly 

identifying the data, any material 

inadequacies therein and the 

implications thereof, and the actuarial 

methods and assumptions employed. 

(f) Due diligence. (1) An enrolled 

actuary must exercise due diligence— 

(i) In preparing or assisting in the 

preparation of, approving, and filing tax 

returns, documents, affidavits, and other 

papers relating to the Department of the 

Treasury, the Department of Labor, the 

Pension Benefit Guaranty Corporation, 

or any other applicable Federal or State 

entity; 

(ii) In determining the correctness of 

oral or written representations made by 

the enrolled actuary to the Department 

of the Treasury, the Department of 

Labor, the Pension Benefit Guaranty 

Corporation, or any other applicable 

Federal or State entity; and 

(iii) In determining the correctness of 

oral or written representations made by 

the enrolled actuary to clients. 

(2) An enrolled actuary advising a 

client to take a position on any 

document to be filed with the 

Department of the Treasury, the 

Department of Labor, the Pension 

Benefit Guaranty Corporation, or any 

other applicable Federal or State entity 

(or preparing or signing such a return or 

document) generally may rely in good 

faith without verification upon 

information furnished by the client. The 

enrolled actuary may not, however, 

ignore the implications of information 

furnished to, or actually known by, the 

enrolled actuary, and must make 

reasonable inquiries if the information 

as furnished appears to be incorrect, 

inconsistent with an important fact or 

another factual assumption, or 

incomplete. 

(g) Solicitations regarding actuarial 

services. An enrolled actuary may not in 

any way use or participate in the use of 

any form of public communication or 

private solicitation related to the 

performance of actuarial services 

containing a false, fraudulent, or 

coercive statement or claim, or a 

misleading or deceptive statement or 

claim. An enrolled actuary may not 

make, directly or indirectly, an 

uninvited written or oral solicitation of 

employment related to actuarial services 

if the solicitation violates Federal or 

State law, nor may such person employ, 

accept employment in partnership form, 

corporate form, or any other form, or 

share fees with, any individual or entity 

who so solicits. Any lawful solicitation 

related to the performance of actuarial 

services made by or on behalf of an 

enrolled actuary must clearly identify 

the solicitation as such and, if 

applicable, identify the source of the 

information used in choosing the 

recipient. 

(h) Prompt disposition of pending 

matters. An enrolled actuary may not 

unreasonably delay the prompt 

disposition of any matter before the 

Internal Revenue Service, the 

Department of Labor, the Pension 

Benefit Guaranty Corporation, or any 

other applicable Federal or State entity. 

(i) [Reserved] 

(j) Return of client’s records. (1) In 

general, an enrolled actuary must, at the 

request of a client, promptly return any 

and all records of the client that are 

necessary for the client to comply with 

his or her legal obligations. The enrolled 

actuary may retain copies of the records 

returned to a client. The existence of a 

dispute over fees generally does not 

relieve the enrolled actuary of his or her 

responsibility under this section. 

Nevertheless, if applicable state law 

allows or permits the retention of a 

client’s records by an enrolled actuary 

in the case of a dispute over fees for 

services rendered, the enrolled actuary 

need only return those records that must 

be attached to the client’s legally 

required forms. The enrolled actuary, 

however, must provide the client with 

reasonable access to review and copy 

any additional records of the client 

retained by the enrolled actuary under 

state law that are necessary for the client 

to comply with his or her legal 

obligations. 

(2) For purposes of this section, 

records of the client include all 

documents or written or electronic 

materials provided to the enrolled 

actuary, or obtained by the enrolled 

actuary in the course of the enrolled 

actuary’s representation of the client, 

that preexisted the retention of the 

enrolled actuary by the client. The term 

‘‘records of the client’’ also includes 

materials that were prepared by the 

client or a third party (not including an 

employee or agent of the enrolled 

actuary) at any time and provided to the 

enrolled actuary with respect to the 

subject matter of the representation. The 

term ‘‘records of the client’’ also 

includes any return, claim for refund, 

schedule, affidavit, appraisal or any 


srobinson on DSKHWCL6B1PROD with PROPOSALS
Federal Register / Vol. 74, No. 181 / Monday, September 21, 2009 / Proposed Rules 48043 

other document prepared by the 

enrolled actuary, or his or her employee 

or agent, that was presented to the client 

with respect to a prior representation if 

such document is necessary for the 

taxpayer to comply with his or her 

current legal obligations. The term 

‘‘records of the client’’ does not include 

any return, claim for refund, schedule, 

affidavit, appraisal or any other 

document prepared by the enrolled 

actuary or the enrolled actuary’s firm, 

employees or agents if the enrolled 

actuary is withholding such document 

pending the client’s performance of its 

contractual obligation to pay fees with 

respect to such document. 

* * * * * 

(m) The rules of this section apply to 

all actuarial services and related acts 

performed on or after the date these 

regulations are published as final 

regulations in the Federal Register. 

Par. 10. Section 901.31 is amended by 

revising paragraphs (a) and (c) 

introductory text to read as follows: 

§ 901.31 Grounds for suspension or 

termination of enrollment. 

(a) Failure to satisfy requirements for 

enrollment. The enrollment of an 

actuary may be terminated if it is found 

that the actuary did not satisfy the 

eligibility requirements set forth in 

§ 901.11 or § 901.12. 

* * * * * 

(c) Disreputable conduct. The 

enrollment of an actuary may be 

suspended or terminated if it is found 

that the actuary has, at any time after 

he/she applied for enrollment, engaged 

in any conduct set forth in § 901.12(f) or 

other conduct evidencing fraud, 

dishonesty, or breach of trust. Such 

other conduct includes, but is not 

limited to, the following: 

* * * * * 

Par. 11. Section 901.32 is amended by 

revising the last sentence to read as 

follows: 

§ 901.32 Receipt of information 

concerning enrolled actuaries. 

* * * If any other person has 

information of any such violation, he/ 

she may make a report thereof to the 

Executive Director. 

Par. 12. Section 901.47 is amended by 

revising the last sentence to read as 

follows: 

§ 901.47 Transcript. 

* * * Copies of exhibits introduced 

at the hearing or at the taking of 

depositions will be supplied to parties 

upon the payment of a reasonable fee 

(31 U.S.C. 9701). 

Par. 13. Section 901.72 is added to 

read as follows: 

§ 901.72 Additional rules. 

The Joint Board may, in notice or 

other guidance of general applicability, 

provide additional rules regarding the 

enrollment of actuaries. 

Zenaida Samaniego, 

Chairman, Joint Board for the Enrollment of 

Actuaries. 

[FR Doc. E9–22454 Filed 9–18–09; 8:45 am] 

BILLING CODE 4810–25–P 

DEPARTMENT OF HOMELAND 

SECURITY 

Federal Emergency Management 

Agency 

44 CFR Part 67 

[Docket ID FEMA–2008–0020; Internal 

Agency Docket No. FEMA–B–1074] 

Proposed Flood Elevation 

Determinations 

AGENCY: Federal Emergency 

Management Agency, DHS. 

ACTION: Proposed rule. 

SUMMARY: Comments are requested on 

the proposed Base (1% annual-chance) 

Flood Elevations (BFEs) and proposed 

BFE modifications for the communities 

listed in the table below. The purpose 

of this notice is to seek general 

information and comment regarding the 

proposed regulatory flood elevations for 

the reach described by the downstream 

and upstream locations in the table 

below. The BFEs and modified BFEs are 

a part of the floodplain management 

measures that the community is 

required either to adopt or show 

evidence of having in effect in order to 

qualify or remain qualified for 

participation in the National Flood 

Insurance Program (NFIP). In addition, 

these elevations, once finalized, will be 

used by insurance agents, and others to 

calculate appropriate flood insurance 

premium rates for new buildings and 

the contents in those buildings. 

DATES: Comments are to be submitted 

on or before December 21, 2009. 

ADDRESSES: The corresponding 

preliminary Flood Insurance Rate Map 

(FIRM) for the proposed BFEs for each 

community is available for inspection at 

the community’s map repository. The 

respective addresses are listed in the 

table below. 

You may submit comments, identified 

by Docket No. FEMA–B–1074, to Kevin 

C. Long, Acting Chief, Engineering 

Management Branch, Mitigation 

Directorate, Federal Emergency 

Management Agency, 500 C Street, SW., 

Washington, DC 20472, (202) 646–2820, 

or (e-mail) kevin.long@dhs.gov. 

FOR FURTHER INFORMATION CONTACT: 

Kevin C. Long, Acting Chief, 

Engineering Management Branch, 

Mitigation Directorate, Federal 

Emergency Management Agency, 500 C 

Street, SW., Washington, DC 20472, 

(202) 646–2820, or (e-mail) 

kevin.long@dhs.gov. 

SUPPLEMENTARY INFORMATION: The 

Federal Emergency Management Agency 

(FEMA) proposes to make 

determinations of BFEs and modified 

BFEs for each community listed below, 

in accordance with section 110 of the 

Flood Disaster Protection Act of 1973, 

42 U.S.C. 4104, and 44 CFR 67.4(a). 

These proposed BFEs and modified 

BFEs, together with the floodplain 

management criteria required by 44 CFR 

60.3, are the minimum that are required. 

They should not be construed to mean 

that the community must change any 

existing ordinances that are more 

stringent in their floodplain 

management requirements. The 

community may at any time enact 

stricter requirements of its own, or 

pursuant to policies established by other 

Federal, State, or regional entities. 

These proposed elevations are used to 

meet the floodplain management 

requirements of the NFIP and are also 

used to calculate the appropriate flood 

insurance premium rates for new 

buildings built after these elevations are 

made final, and for the contents in these 

buildings. 

Comments on any aspect of the Flood 

Insurance Study and FIRM, other than 

the proposed BFEs, will be considered. 

A letter acknowledging receipt of any 

comments will not be sent. 

National Environmental Policy Act. 

This proposed rule is categorically 

excluded from the requirements of 44 

CFR part 10, Environmental 

Consideration. An environmental 

impact assessment has not been 

prepared. 

Regulatory Flexibility Act. As flood 

elevation determinations are not within 

the scope of the Regulatory Flexibility 

Act, 5 U.S.C. 601–612, a regulatory 

flexibility analysis is not required. 

Executive Order 12866, Regulatory 

Planning and Review. This proposed 

rule is not a significant regulatory action 

under the criteria of section 3(f) of 

Executive Order 12866, as amended. 

Executive Order 13132, Federalism. 

This proposed rule involves no policies 

that have federalism implications under 

Executive Order 13132. 

Executive Order 12988, Civil Justice 

Reform. This proposed rule meets the 


srobinson on DSKHWCL6B1PROD with PROPOSALS