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[Federal Register Volume 80, Number 17 (Tuesday, January 27, 2015)]
[Notices]
[Pages 4316-4318]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-01354]

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DEPARTMENT OF LABOR

Office of the Secretary

Agency Information Collection Activities; Submission for OMB 
Review; Comment Request; Employee Retirement Income Security Act 
Prohibited Transaction Exemption 1986-128 for Securities Transactions 
Involving Employee Benefit Plans and Broker-Dealers

ACTION: Notice.

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SUMMARY: The Department of Labor (DOL) is submitting the Employee 
Benefits Security Administration (EBSA) sponsored information 
collection request (ICR) titled, ``Employee Retirement Income Security 
Act Prohibited Transaction Exemption 1986-128 For Securities 
Transactions Involving Employee Benefit Plans and Broker-Dealers,'' to 
the Office of Management and Budget (OMB) for review and approval for 
continued use, without change, in accordance with the Paperwork 
Reduction Act of 1995 (PRA), 44 U.S.C. 3501 et seq. Public comments on 
the ICR are invited.

DATES: The OMB will consider all written comments that agency receives 
on or before February 26, 2015.

ADDRESSES: A copy of this ICR with applicable supporting documentation; 
including a description of the likely respondents, proposed frequency 
of response, and estimated total burden may be obtained free of charge 
from the RegInfo.gov Web site at http://www.reginfo.gov/public/do/

[[Page 4317]]

PRAViewICR?ref_nbr=201412-1210-005 (this link will only become active 
on the day following publication of this notice) or by contacting 
Michel Smyth by telephone at 202-693-4129, TTY 202-693-8064, (these are 
not toll-free numbers) or by email at [email protected].
    Submit comments about this request by mail or courier to the Office 
of Information and Regulatory Affairs, Attn: OMB Desk Officer for DOL-
EBSA, Office of Management and Budget, Room 10235, 725 17th Street NW., 
Washington, DC 20503; by Fax: 202-395-5806 (this is not a toll-free 
number); or by email: [email protected]. Commenters are 
encouraged, but not required, to send a courtesy copy of any comments 
by mail or courier to the U.S. Department of Labor-OASAM, Office of the 
Chief Information Officer, Attn: Departmental Information Compliance 
Management Program, Room N1301, 200 Constitution Avenue NW., 
Washington, DC 20210; or by email: [email protected].

FOR FURTHER INFORMATION CONTACT: Michel Smyth by telephone at 202-693-
4129, TTY 202-693-8064, (these are not toll-free numbers) or by email 
at [email protected].
    Authority: 44 U.S.C. 3507(a)(1)(D).

SUPPLEMENTARY INFORMATION: This ICR seeks to extend PRA authority for 
the information collection requirements in Employee Retirement Income 
Security Act (ERISA) Prohibited Transaction Exemption (PTE) 1986-128, 
which applies to securities transactions involving an employee benefit 
plan and a broker-dealer. PTE 1986-128 permits a person who serves as 
fiduciary for an employee benefit plan to effect or execute securities 
transactions on behalf of the employee benefit plan. The PTE also 
allows sponsors of pooled separate accounts and other pooled investment 
funds to use their affiliates to effect or execute securities 
transactions for such accounts in order to recapture brokerage 
commissions for the benefit of employee benefit plans whose assets are 
maintained in pooled separate accounts managed by insurance companies. 
This exemption provides relief from certain prohibitions in ERISA 
section 406(b) (see 29 U.S.C. 1106(b)) and from the taxes imposed by 
Internal Revenue Code of 1986 (Code) section 4975(a) and (b) by reason 
of Code section 4975(c)(1)(E) or (F) (see 26 U.S.C. 4975(a), (b), and 
(c)(1)(E) and (F)).
    PTE 1986-128 section III imposes the following information 
collection requirements on a fiduciary of an employee benefit plan that 
effects or executes securities transactions (i.e., a broker-dealer) and 
the independent plan fiduciary authorizing the plan to engage in the 
transactions with the broker-dealer (i.e., an authorizing fiduciary) 
under the conditions contained in the exemption: (1) The authorizing 
plan fiduciary must provide the broker-dealer with an advance written 
authorization for the transactions; (2) the broker-dealer must provide 
the authorizing fiduciary with information necessary to determine 
whether an authorization should be made, including a copy of the 
exemption, a form for termination, a description of the broker-dealer's 
brokerage placement practices, and any other reasonably available 
information regarding the matter that the authorizing fiduciary 
requests; (3) the broker-dealer must provide the authorizing fiduciary 
with a termination form, at least annually, explaining that the 
authorization is terminable at will, without penalty to the plan, and 
that failure to return the form will result in continued authorization 
for the broker-dealer to engage in securities transactions on behalf of 
the plan; (4) the broker-dealer must provide the authorizing fiduciary 
with either (a) a confirmation slip for each individual securities 
transaction within ten (10) days of the transaction containing the 
information described in regulations 17 CFR 240.10b-10, or (b) a 
quarterly report containing certain financial information including the 
total of all transaction-related charges incurred by the plan; (5) the 
broker-dealer must provide the authorizing fiduciary with an annual 
summary of the confirmation slips or quarterly reports, containing all 
security transaction-related charges, the brokerage placement practices 
(if changed), and a portfolio turnover ratio; and (6) a broker-dealer 
who is a discretionary plan trustee must provide the authorizing 
fiduciary with an annual report showing separately the commissions paid 
to affiliated brokers and non-affiliated brokers, on both a total 
dollar basis and a cents-per-share basis. These requirements are 
designed as appropriate safeguards to ensure protection of plan assets 
involved in the transactions, which, in the absence of the class 
exemption, would not be permitted. These safeguards rely on the prior 
authorization and monitoring of the broker-fiduciary's activities by a 
second plan fiduciary that is independent of the first. This 
information collection is authorized by ERISA section 408. See 29 
U.S.C. 1108.
    This information collection is subject to the PRA. A Federal agency 
generally cannot conduct or sponsor a collection of information, and 
the public is generally not required to respond to an information 
collection, unless it is approved by the OMB under the PRA and displays 
a currently valid OMB Control Number. In addition, notwithstanding any 
other provisions of law, no person shall generally be subject to 
penalty for failing to comply with a collection of information that 
does not display a valid Control Number. See 5 CFR 1320.5(a) and 
1320.6. The DOL obtains OMB approval for this information collection 
under Control Number 1210-0059.
    OMB authorization for an ICR cannot be for more than three (3) 
years without renewal, and the current approval for this collection is 
scheduled to expire on January 31, 2015. The DOL seeks to extend PRA 
authorization for this information collection for three (3) more years, 
without any change to existing requirements. The DOL notes that 
existing information collection requirements submitted to the OMB 
receive a month-to-month extension while they undergo review. For 
additional substantive information about this ICR, see the related 
notice published in the Federal Register on October 15, 2014 (79 FR 
61903).
    Interested parties are encouraged to send comments to the OMB, 
Office of Information and Regulatory Affairs at the address shown in 
the ADDRESSES section within thirty (30) days of publication of this 
notice in the Federal Register. In order to help ensure appropriate 
consideration, comments should mention OMB Control Number 1210-0059. 
The OMB is particularly interested in comments that:
     Evaluate whether the proposed collection of information is 
necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility;
     Evaluate the accuracy of the agency's estimate of the 
burden of the proposed collection of information, including the 
validity of the methodology and assumptions used;
     Enhance the quality, utility, and clarity of the 
information to be collected; and
     Minimize the burden of the collection of information on 
those who are to respond, including through the use of appropriate 
automated, electronic, mechanical, or other technological collection 
techniques or other forms of information technology, e.g., permitting 
electronic submission of responses.
    Agency: DOL-EBSA.
    Title of Collection: Employee Retirement Income Security Act

[[Page 4318]]

Prohibited Transaction Exemption 1986-128 For Securities Transactions 
Involving Employee Benefit Plans and Broker-Dealers.
    OMB Control Number: 1210-0059.
    Affected Public: Private sector--businesses or other for-profits 
and not-for-profit institutions.
    Total Estimated Number of Respondents: 17,800.
    Total Estimated Number of Responses: 1,300,000.
    Total Estimated Annual Time Burden: 35,000 hours.
    Total Estimated Annual Other Costs Burden: $1,100,000.

    Dated: January 21, 2015.
Michel Smyth,
Departmental Clearance Officer.
[FR Doc. 2015-01354 Filed 1-26-15; 8:45 am]
BILLING CODE 4510-29-P
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