agreement, arrangement, or under-
standing, and such information shall 
contain the disclaimer required by 
subparagraph (B), if— 
‘‘(i) SELLER’S
EXCEPTION.—The 
information is provided in con-
junction with full and fair disclo-
sure in writing to a plan, plan 
participant, or beneficiary that 
the person providing the informa-
tion is doing so in its marketing 
or sales capacity, including any 
information regarding the terms 
and conditions of the engagement 
of the person providing the infor-
mation, and that the person is not 
intending to provide investment 
advice within the meaning of this 
subparagraph or to otherwise act 
as a fiduciary to the plan or 
under the obligations of a best in-
terest recommendation. 
‘‘(ii) SWAP AND SECURITY-BASED 
SWAP
TRANSACTION.—The person 
providing the information is a 
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counterparty or service provider 
to the plan in connection with 
any transaction based on the in-
formation (including a service ar-
rangement, sale, purchase, loan, 
bilateral contract, swap (as de-
fined in section 1a of the Com-
modity Exchange Act (7 U.S.C. 
1a)), or security-based swap (as 
defined in section 3(a) of the Se-
curities Exchange Act (15 U.S.C. 
78c(a)))), but only if— 
‘‘(I) 
the 
plan 
is 
rep-
resented, in connection with 
such transaction, by a plan fi-
duciary who is independent of 
the person providing the in-
formation, and, except in the 
case of a swap or security- 
based swap, independent of 
the plan sponsor; and 
‘‘(II) prior to entering into 
such transaction, the inde-
pendent plan fiduciary rep-
resents in writing to the per-
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son providing the information 
that it is aware that the per-
son has a financial interest in 
the transaction and that it 
has determined that the per-
son is not intending to pro-
vide investment advice within 
the meaning of this subpara-
graph or to otherwise act as a 
fiduciary to the plan, plan 
participants, or plan bene-
ficiaries. 
‘‘(iii) EMPLOYEES
OF
A
PLAN 
SPONSOR.—The person providing 
the information is an employee of 
any sponsoring employer or em-
ployee organization who provides 
the information to the plan for no 
fee or other compensation other 
than the employee’s normal com-
pensation. 
‘‘(iv) PLATFORM PROVIDERS SE-
LECTION
AND
MONITORING
ASSIST-
ANCE.—The person providing the 
information discloses in writing 
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rfrederick on DSK6VPTVN1PROD with BILLS
to the plan fiduciary that the per-
son is not undertaking to provide 
investment advice as a fiduciary 
(within the meaning of this para-
graph) or under the obligations of 
a best interest recommendation 
and the information consists sole-
ly of— 
‘‘(I) making available to 
the plan, plan participants, or 
plan beneficiaries, without re-
gard 
to 
the 
individualized 
needs of the plan, plan par-
ticipants, 
or 
plan 
bene-
ficiaries, securities or other 
property through a platform 
or similar mechanism from 
which a plan fiduciary may 
select or monitor investment 
alternatives, including quali-
fied default investment alter-
natives, into which plan par-
ticipants or beneficiaries may 
direct the investment of as-
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rfrederick on DSK6VPTVN1PROD with BILLS
sets held in, or contributed to, 
their individual accounts, or 
‘‘(II) in connection with a 
platform or similar mecha-
nism described in subclause 
(I)— 
‘‘(aa) 
identifying 
in-
vestment alternatives that 
meet 
objective 
criteria 
specified by the plan, such 
as criteria concerning ex-
pense ratios, fund sizes, 
types of asset, or credit 
quality, or 
‘‘(bb) providing objec-
tive financial data and 
comparisons 
with 
inde-
pendent 
benchmarks 
to 
the plan. 
‘‘(v) VALUATION.—The informa-
tion consists solely of valuation 
information. 
‘‘(vi) FINANCIAL
EDUCATION.— 
The information consists solely 
of— 
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‘‘(I) information described 
in Department of Labor Inter-
pretive 
Bulletin 
96–1 
(29 
C.F.R. 2509.96–1, as in effect 
on January 1, 2015), regard-
less of whether such edu-
cation is provided to a plan or 
plan fiduciary or a partici-
pant or beneficiary, 
‘‘(II) information provided 
to 
participants 
or 
bene-
ficiaries regarding the factors 
to consider in deciding wheth-
er to elect to receive a dis-
tribution from a plan and 
whether to roll over such dis-
tribution to a plan, so long as 
any examples of different dis-
tribution and rollover alter-
natives are accompanied by 
all material facts and assump-
tions on which the examples 
are based, or 
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rfrederick on DSK6VPTVN1PROD with BILLS
‘‘(III) any additional infor-
mation treated as education 
by the Secretary. 
‘‘(11) 
BEST
INTEREST
RECOMMENDA-
TION.—For purposes of this subsection— 
‘‘(A) IN GENERAL.—The term ‘best 
interest recommendation’ means a 
recommendation— 
‘‘(i) for which no more than 
reasonable compensation is paid 
(as determined under subsection 
(d)(2)), 
‘‘(ii) provided by a person act-
ing with the care, skill, prudence, 
and 
diligence 
under 
the 
cir-
cumstances then prevailing that a 
prudent person would exercise 
based on— 
‘‘(I) the information ob-
tained through the reasonable 
diligence of the person re-
garding factors such as the 
advice recipient’s age, and 
‘‘(II) any other informa-
tion that the advice recipient 
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rfrederick on DSK6VPTVN1PROD with BILLS
discloses to the person in con-
nection with receiving such 
recommendation, and 
‘‘(iii) where the person places 
the interests of the plan or advice 
recipient above its own. 
‘‘(B) INVESTMENT
OPTIONS; 
VARI-
ABLE
COMPENSATION.—A best interest 
recommendation may include a rec-
ommendation that— 
‘‘(i) is based on a limited 
range 
of 
investment 
options 
(which may consist, in whole or 
in part, of proprietary products), 
but only if any such limitations, 
including a clearly-stated notice 
that the same or similar invest-
ments may be available at a dif-
ferent cost (greater or lesser) 
from other sources, are clearly 
disclosed to the advice recipient 
prior to any transaction based on 
the recommendation, or 
‘‘(ii) may result in variable 
compensation to the person pro-
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rfrederick on DSK6VPTVN1PROD with BILLS
viding the recommendation (or 
any affiliate of such person), but 
only if the receipt of such com-
pensation, including a clearly- 
stated notice that the same or 
similar investments may be avail-
able at a different cost (greater or 
lesser) from other sources, is 
clearly disclosed to the advice re-
cipient prior to any transaction 
based on the recommendation. 
The notices provided pursuant to 
clauses (i) and (ii) shall only state the 
following: ‘The same or similar invest-
ments may be available at a different 
cost (greater or lesser) from other 
sources.’. 
‘‘(C) CLEAR
DISCLOSURE
OF
VARI-
ABLE COMPENSATION.—For purposes of 
subparagraph (B)(ii), variable com-
pensation is clearly disclosed if notifi-
cation is provided at any time prior 
to a transaction based on the person’s 
recommendation, in a manner cal-
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culated to be understood by the aver-
age individual, of the following: 
‘‘(i) A notice in writing, in-
cluding a clearly-stated notice 
that the same or similar invest-
ments may be available at a dif-
ferent cost (greater or lesser) 
from other sources, that the per-
son providing the recommenda-
tion (or its affiliate) may receive 
varying amounts of fees or other 
compensation 
with 
respect 
to 
such transaction. 
‘‘(ii) A description of any fee 
or other compensation that is di-
rectly payable to the person (or 
its affiliate) from the advice re-
cipient 
with 
respect 
to 
such 
transaction 
(expressed 
as 
an 
amount, formula, percentage of 
assets, per capita charge, or esti-
mate or range of such compensa-
tion). 
‘‘(iii) A description of the 
types and ranges of any indirect 
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compensation that may be paid to 
the person (or its affiliate) by any 
third party in connection with 
such transaction (expressed as an 
amount, formula, percentage of 
assets, per capita charge, or esti-
mate of such ranges of compensa-
tion). 
‘‘(iv) Upon request of the ad-
vice recipient, a disclosure of the 
specific amounts of compensation 
described in clause (iii) that the 
person will receive in connection 
with the particular transaction 
(expressed as an amount, formula, 
percentage of assets, per capita 
charge, or estimate of such com-
pensation). 
‘‘(D) DEFINITION OF AFFILIATE.—For 
purposes of this paragraph, the term 
‘affiliate’ has the meaning given in 
subsection (f)(8)(J)(ii). 
‘‘(E) CORRECTION
OF
CERTAIN
ER-
RORS AND OMISSIONS.—A recommenda-
tion shall not fail to be a best interest 
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recommendation solely because a per-
son who, acting in good faith and 
with reasonable diligence, makes an 
error or omission in disclosing the in-
formation specified in subparagraph 
(B), if the person discloses the correct 
information to the advice recipient as 
soon as practicable but not later than 
30 days from the date on which the 
person knows of such error or omis-
sion.’’. 
(3) FAILURES RELATING TO BEST INTER-
EST RECOMMENDATION.— 
(A) 
CORRECTION.—Section 
4975(f)(5) of such Code is amended— 
(i) by striking ‘‘(5) CORREC-
TION.—The terms’’ and inserting: 
‘‘(5) CORRECTION.— 
‘‘(A) IN GENERAL.—Except as pro-
vided 
in 
subparagraph 
(B), 
the 
terms’’, and 
(ii) by adding at the end the 
following: 
‘‘(B) DETERMINATION
OF ‘CORREC-
TION’ AND ‘CORRECT’ WITH RESPECT TO 
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rfrederick on DSK6VPTVN1PROD with BILLS
BEST
INTEREST
ADVICE
RECOMMENDA-
TIONS.—In the case of a prohibited ad-
vice transaction arising by the failure 
of investment advice to be a best in-
terest recommendation, the terms 
‘correction’ and ‘correct’ mean the 
payment to, or reimbursement of, ac-
tual damages of the plan, plan par-
ticipants, or plan beneficiaries result-
ing directly from the plan’s, plan par-
ticipant’s, or plan beneficiary’s reli-
ance on such investment advice, if 
any, that have not otherwise been 
paid or reimbursed to the plan, plan 
participants, or plan beneficiaries, in-
cluding 
payments 
and 
reimburse-
ments made pursuant to subpara-
graph (A).’’. 
(B) AMOUNT
INVOLVED
FOR
PUR-
POSES
OF
EXCISE
TAX.—The first sen-
tence of section 4975(f)(4) of such 
Code is amended by striking ‘‘excess 
compensation.’’ and inserting ‘‘excess 
compensation, and in the case of a 
prohibited transaction arising by the 
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