HR 1000 RFS 
solely by reason of the provision of investment 
advice referred to in subsection (e)(3)(B) (or 
solely by reason of contracting for or otherwise 
arranging for the provision of the advice), if—
‘‘(i) the advice is provided by a fidu-
ciary adviser pursuant to an arrangement 
between the plan sponsor or other fidu-
ciary and the fiduciary adviser for the pro-
vision by the fiduciary adviser of invest-
ment advice referred to in such section, 
‘‘(ii) the terms of the arrangement re-
quire compliance by the fiduciary adviser 
with the requirements of this paragraph, 
‘‘(iii) the terms of the arrangement 
include a written acknowledgment by the 
fiduciary adviser that the fiduciary adviser 
is a fiduciary of the plan with respect to 
the provision of the advice, and 
‘‘(iv) the requirements of part 4 of 
subtitle B of title I of the Employee Re-
tirement Income Security Act of 1974 are 
met in connection with the provision of 
such advice. 
‘‘(G) DEFINITIONS.—For purposes of this 
paragraph and subsection (d)(16)—
HR 1000 RFS 
‘‘(i) FIDUCIARY ADVISER.—The term 
‘fiduciary adviser’ means, with respect to a 
plan, a person who is a fiduciary of the 
plan by reason of the provision of invest-
ment advice by the person to the plan or 
to a participant or beneficiary and who 
is—
‘‘(I) registered as an investment 
adviser under the Investment Advisers 
Act of 1940 (15 U.S.C. 80b–1 et seq.) 
or under the laws of the State in 
which the fiduciary maintains its prin-
cipal office and place of business, 
‘‘(II) a bank or similar financial 
institution referred to in subsection 
(d)(4) or a savings association (as de-
fined in section 3(b)(1) of the Federal 
Deposit Insurance Act (12 U.S.C. 
1813(b)(1))), but only if the advice is 
provided through a trust department 
of the bank or similar financial insti-
tution or savings association which is 
subject to periodic examination and 
review by Federal or State banking 
authorities,
HR 1000 RFS 
‘‘(III) an insurance company 
qualified to do business under the 
laws of a State, 
‘‘(IV) a person registered as a 
broker or dealer under the Securities 
Exchange Act of 1934 (15 U.S.C. 78a 
et seq.), 
‘‘(V) an affiliate of a person de-
scribed in any of subclauses (I) 
through (IV), or 
‘‘(VI) an employee, agent, or reg-
istered representative of a person de-
scribed in any of subclauses (I) 
through (V) who satisfies the require-
ments of applicable insurance, bank-
ing, and securities laws relating to the 
provision of the advice. 
‘‘(ii) AFFILIATE.—The term ‘affiliate’ 
of another entity means an affiliated per-
son of the entity (as defined in section 
2(a)(3) of the Investment Company Act of 
1940 (15 U.S.C. 80a–2(a)(3))). 
‘‘(iii) 
REGISTERED
REPRESENTA-
TIVE.—The term ‘registered representa-
tive’ of another entity means a person de-
HR 1000 RFS 
scribed in section 3(a)(18) of the Securi-
ties Exchange Act of 1934 (15 U.S.C. 
78c(a)(18)) (substituting the entity for the 
broker or dealer referred to in such sec-
tion) or a person described in section 
202(a)(17) of the Investment Advisers Act 
of 1940 (15 U.S.C. 80b–2(a)(17)) (sub-
stituting the entity for the investment ad-
viser referred to in such section).’’. 
SEC. 106. STUDY REGARDING IMPACT ON RETIREMENT 
SAVINGS 
OF 
PARTICIPANTS 
AND 
BENE-
FICIARIES BY REQUIRING CONSULTANTS TO 
ADVISE PLAN FIDUCIARIES OF INDIVIDUAL 
ACCOUNT PLANS. 
(a) STUDY.—As soon as practicable after the date of 
the enactment of this Act, the Secretary of Labor shall 
undertake a study of the costs and benefits to participants 
and beneficiaries of requiring independent consultants to 
advise plan fiduciaries in connection with individual ac-
count plans. In conducting such study, the Secretary shall 
consider—
(1) the benefits to plan participants and bene-
ficiaries of engaging independent advisers to provide 
investment and other advice regarding the assets of 
the plan to persons who have fiduciary duties with
HR 1000 RFS 
respect to the management or disposition of such as-
sets, 
(2) the extent to which independent advisers 
are currently retained by plan fiduciaries, 
(3) the availability of assistance to fiduciaries 
from appropriate Federal agencies, 
(4) the availability of qualified independent con-
sultants to serve the needs of individual account 
plan fiduciaries in the United States, 
(5) the impact of the additional fiduciary duty 
of an independent advisor on the strict fiduciary ob-
ligations of plan fiduciaries, 
(6) the impact of new requirements (consulting 
fees, reporting requirements, and new plan duties to 
prudently identify and contract with qualified inde-
pendent consultants) on the availability of individual 
account plans, and 
(7) the impact of a new requirement on the 
plan administration costs per participant for small 
and mid-size employers and the pension plans they 
sponsor. 
(b) REPORT.—Not later than 1 year after the date 
of the enactment of this Act, the Secretary of Labor shall 
report the results of the study undertaken pursuant to this 
section, together with any recommendations for legislative
HR 1000 RFS 
changes, to the Committee on Education and the Work-
force of the House of Representatives and the Committee 
on Health, Education, Labor, and Pensions of the Senate. 
SEC. 107. TREATMENT OF QUALIFIED RETIREMENT PLAN-
NING SERVICES. 
(a) IN GENERAL.—Subsection (m) of section 132 of 
the Internal Revenue Code of 1986 (defining qualified re-
tirement services) is amended by adding at the end the 
following new paragraph: 
‘‘(4) NO CONSTRUCTIVE RECEIPT.—No amount 
shall be included in the gross income of any em-
ployee solely because the employee may choose be-
tween any qualified retirement planning services pro-
vided by a qualified investment advisor and com-
pensation which would otherwise be includible in the 
gross income of such employee. The preceding sen-
tence shall apply to highly compensated employees 
only if the choice described in such sentence is avail-
able on substantially the same terms to each mem-
ber of the group of employees normally provided 
education and information regarding the employer’s 
qualified employer plan.’’. 
(b) CONFORMING AMENDMENTS.—
HR 1000 RFS 
(1) Section 403(b)(3)(B) of such Code is 
amended 
by 
inserting 
‘‘132(m)(4),’’ 
after 
‘‘132(f)(4),’’. 
(2) Section 414(s)(2) of such Code is amended 
by inserting ‘‘132(m)(4),’’ after ‘‘132(f)(4),’’. 
(3) Section 415(c)(3)(D)(ii) of such Code is 
amended 
by 
inserting 
‘‘132(m)(4),’’ 
after 
‘‘132(f)(4),’’. 
(c) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2003. 
SEC. 108. EFFECTIVE DATES AND RELATED RULES. 
(a) IN GENERAL.—Except as otherwise provided in 
the preceding provisions of this title or in subsections (c) 
and (d), the amendments made by this Act shall apply 
with respect to plan years beginning on or after the gen-
eral effective date. 
(b) GENERAL EFFECTIVE DATE.—For purposes of 
this section, the term ‘‘general effective date’’ means the 
date which is 1 year after the date of the enactment of 
this Act. 
(c) SPECIAL RULE FOR COLLECTIVELY BARGAINED 
PLANS.—In the case of a plan maintained pursuant to 1 
or more collective bargaining agreements between em-
ployee representatives and 1 or more employers ratified
HR 1000 RFS 
on or before the date of the enactment of this Act, sub-
section (a) shall be applied to benefits pursuant to, and 
individuals covered by, any such agreement by substituting 
for ‘‘the general effective date’’ the date of the commence-
ment of the first plan year beginning on or after the ear-
lier of—
(1) the later of—
(A) the date which is 1 year after the gen-
eral effective date, or 
(B) the date on which the last of such col-
lective bargaining agreements terminates (de-
termined without regard to any extension there-
of after the date of the enactment of this Act), 
or 
(2) the date which is 2 years after the general 
effective date. 
(d) AMENDMENTS RELATING TO INVESTMENT AD-
VICE.—The amendments made by section 105 shall apply 
with respect to advice referred to in section 3(21)(A)(ii) 
of the Employee Retirement Income Security Act of 1974 
or section 4975(c)(3)(B) of the Internal Revenue Code of 
1986 provided on or after January 1, 2005.
HR 1000 RFS 
TITLE II—OTHER PROVISIONS 
RELATING TO PENSIONS 
SEC. 201. AMENDMENTS TO RETIREMENT PROTECTION ACT 
OF 1994. 
(a) TRANSITION RULE MADE PERMANENT.—Section 
769(c) of the Retirement Protection Act of 1994 (26 
U.S.C. 412 note) is amended—
(1) in the heading, by striking ‘‘TRANSITION’’; 
and 
(2) in paragraph (1), by striking ‘‘transition’’ 
and by striking ‘‘for any plan year beginning after 
1996 and before 2010’’. 
(b) SPECIAL RULES.—Paragraph (2) of section 
769(c) of the Retirement Protection Act of 1994 is amend-
ed to read as follows: 
‘‘(2) SPECIAL RULES.—The rules described in 
this paragraph are as follows: 
‘‘(A) For purposes of section 412(l)(9)(A) 
of the Internal Revenue Code of 1986 and sec-
tion 302(d)(9)(A) of the Employee Retirement 
Income Security Act of 1974, the funded cur-
rent liability percentage for any plan year shall 
be treated as not less than 90 percent. 
‘‘(B) For purposes of section 412(m) of 
the Internal Revenue Code of 1986 and section
HR 1000 RFS 
302(e) of the Employee Retirement Income Se-
curity Act of 1974, the funded current liability 
percentage for any plan year shall be treated as 
not less than 100 percent. 
‘‘(C) For purposes of determining un-
funded 
vested 
benefits 
under 
section 
4006(a)(3)(E)(iii) of the Employee Retirement 
Income Security Act of 1974, the mortality 
table shall be the mortality table used by the 
plan.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plan years beginning after De-
cember 31, 2002. 
SEC. 202. REPORTING SIMPLIFICATION. 
(a) SIMPLIFIED ANNUAL FILING REQUIREMENT FOR 
OWNERS AND THEIR SPOUSES.—
(1) IN GENERAL.—The Secretary of the Treas-
ury and the Secretary of Labor shall modify the re-
quirements for filing annual returns with respect to 
one-participant retirement plans to ensure that such 
plans with assets of $250,000 or less as of the close 
of the plan year need not file a return for that year. 
(2) ONE-PARTICIPANT RETIREMENT PLAN DE-
FINED.—For purposes of this subsection, the term 
‘‘one-participant retirement plan’’ means a retire-
HR 1000 RFS 
ment plan with respect to which the following re-
quirements are met: 
(A) on the first day of the plan year—
(i) the plan covered only one indi-
vidual (or the individual and the individ-
ual’s spouse) and the individual owned 100 
percent of the plan sponsor (whether or 
not incorporated), or 
(ii) the plan covered only one or more 
partners (or partners and their spouses) in 
the plan sponsor; 
(B) the plan meets the minimum coverage 
requirements of section 410(b) of the Internal 
Revenue Code of 1986 without being combined 
with any other plan of the business that covers 
the employees of the business; 
(C) the plan does not provide benefits to 
anyone except the individual (and the individ-
ual’s spouse) or the partners (and their 
spouses); 
(D) the plan does not cover a business that 
is a member of an affiliated service group, a 
controlled group of corporations, or a group of 
businesses under common control; and
HR 1000 RFS 
(E) the plan does not cover a business that 
leases employees. 
(3) OTHER DEFINITIONS.—Terms used in para-
graph (2) which are also used in section 414 of the 
Internal Revenue Code of 1986 shall have the re-
spective meanings given such terms by such section. 
(4) EFFECTIVE DATE.—The provisions of this 
subsection shall apply to plan years beginning on or 
after January 1, 2003.
(b) SIMPLIFIED ANNUAL FILING REQUIREMENT FOR 
PLANS WITH FEWER THAN 25 EMPLOYEES.—In the case 
of plan years beginning after December 31, 2004, the Sec-
retary of the Treasury and the Secretary of Labor shall 
provide for the filing of a simplified annual return for any 
retirement plan which covers less than 25 employees on 
the first day of a plan year and which meets the require-
ments described in subparagraphs (B), (D), and (E) of 
subsection (a)(2). 
SEC. 203. IMPROVEMENT OF EMPLOYEE PLANS COMPLI-
ANCE RESOLUTION SYSTEM. 
The Secretary of the Treasury shall continue to up-
date and improve the Employee Plans Compliance Resolu-
tion System (or any successor program) giving special at-
tention to—
HR 1000 RFS 
(1) increasing the awareness and knowledge of 
small employers concerning the availability and use 
of the program; 
(2) taking into account special concerns and 
circumstances that small employers face with respect 
to compliance and correction of compliance failures; 
(3) extending the duration of the self-correction 
period under the Self-Correction Program for signifi-
cant compliance failures; 
(4) expanding the availability to correct insig-
nificant compliance failures under the Self-Correc-
tion Program during audit; and 
(5) assuring that any tax, penalty, or sanction 
that is imposed by reason of a compliance failure is 
not excessive and bears a reasonable relationship to 
the nature, extent, and severity of the failure. 
The Secretary of the Treasury shall have full authority 
to effectuate the foregoing with respect to the Employee 
Plans Compliance Resolution System (or any successor 
program) and any other employee plans correction poli-
cies, including the authority to waive income, excise, or 
other taxes to ensure that any tax, penalty, or sanction 
is not excessive and bears a reasonable relationship to the 
nature, extent, and severity of the failure.
HR 1000 RFS 
SEC. 204. FLEXIBILITY IN NONDISCRIMINATION, COV-
ERAGE, AND LINE OF BUSINESS RULES. 
(a) NONDISCRIMINATION.—
(1) IN GENERAL.—The Secretary of the Treas-
ury shall, by regulation, provide that a plan shall be 
deemed to satisfy the requirements of section 
401(a)(4) of the Internal Revenue Code of 1986 if 
such plan satisfies the facts and circumstances test 
under section 401(a)(4) of such Code, as in effect 
before January 1, 1994, but only if—
(A) the plan satisfies conditions prescribed 
by the Secretary to appropriately limit the 
availability of such test; and 
(B) the plan is submitted to the Secretary 
for a determination of whether it satisfies such 
test. 
Subparagraph (B) shall only apply to the extent pro-
vided by the Secretary. 
(2) EFFECTIVE DATES.—
(A) REGULATIONS.—The regulation re-
quired by paragraph (1) shall apply to years be-
ginning after December 31, 2004. 
(B) CONDITIONS OF AVAILABILITY.—Any 
condition of availability prescribed by the Sec-
retary under paragraph (1)(A) shall not apply 
before the first year beginning not less than
HR 1000 RFS 
120 days after the date on which such condition 
is prescribed. 
(b) COVERAGE TEST.—
(1) IN GENERAL.—Section 410(b)(1) of the In-
ternal Revenue Code of 1986 (relating to minimum 
coverage requirements) is amended by adding at the 
end the following: 
‘‘(D) In the case that the plan fails to 
meet the requirements of subparagraphs (A), 
(B) and (C), the plan—
‘‘(i) satisfies subparagraph (B), as in 
effect immediately before the enactment of 
the Tax Reform Act of 1986, 
‘‘(ii) is submitted to the Secretary for 
a determination of whether it satisfies the 
requirement described in clause (i), and 
‘‘(iii) satisfies conditions prescribed by 
the Secretary by regulation that appro-
priately limit the availability of this sub-
paragraph. 
Clause (ii) shall apply only to the extent pro-
vided by the Secretary.’’. 
(2) EFFECTIVE DATES.—
HR 1000 RFS 
(A) IN GENERAL.—The amendment made 
by paragraph (1) shall apply to years beginning 
after December 31, 2004. 
(B) CONDITIONS OF AVAILABILITY.—Any 
condition of availability prescribed by the Sec-
retary under regulations prescribed by the Sec-
retary under section 410(b)(1)(D) of the Inter-
nal Revenue Code of 1986 shall not apply be-
fore the first year beginning not less than 120 
days after the date on which such condition is 
prescribed. 
(c) LINE OF BUSINESS RULES.—The Secretary of 
the Treasury shall, on or before December 31, 2004, mod-
ify the existing regulations issued under section 414(r) of 
the Internal Revenue Code of 1986 in order to expand 
(to the extent that the Secretary determines appropriate) 
the ability of a pension plan to demonstrate compliance 
with the line of business requirements based upon the 
facts and circumstances surrounding the design and oper-
ation of the plan, even though the plan is unable to satisfy 
the mechanical tests currently used to determine compli-
ance.
HR 1000 RFS 
SEC. 205. EXTENSION TO ALL GOVERNMENTAL PLANS OF 
MORATORIUM ON APPLICATION OF CERTAIN 
NONDISCRIMINATION RULES APPLICABLE TO 
STATE AND LOCAL PLANS. 
(a) IN GENERAL.—
(1) Subparagraph (G) of section 401(a)(5) of 
the Internal Revenue Code of 1986 and subpara-
graph (H) of section 401(a)(26) of such Code are 
each amended by striking ‘‘section 414(d))’’ and all 
that follows and inserting ‘‘section 414(d)).’’. 
(2) Subparagraph (G) of section 401(k)(3) of 
the Internal Revenue Code of 1986 and paragraph 
(2) of section 1505(d) of the Taxpayer Relief Act of 
1997 (26 U.S.C. 401 note) are each amended by 
striking ‘‘maintained by a State or local government 
or political subdivision thereof (or agency or instru-
mentality thereof)’’. 
(b) CONFORMING AMENDMENTS.—
(1) The heading for subparagraph (G) of sec-
tion 401(a)(5) of such Code is amended to read as 
follows: ‘‘GOVERNMENTAL PLANS.—’’. 
(2) The heading for subparagraph (H) of sec-
tion 401(a)(26) of such Code is amended to read as 
follows: 
‘‘EXCEPTION
FOR
GOVERNMENTAL
PLANS.—’’.
HR 1000 RFS 
(3) Subparagraph (G) of section 401(k)(3) of 
such Code is amended by inserting ‘‘GOVERN-
MENTAL PLANS.—’’ after ‘‘(G)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to years beginning after December 
31, 2003. 
SEC. 206. NOTICE AND CONSENT PERIOD REGARDING DIS-
TRIBUTIONS. 
(a) EXPANSION OF PERIOD.—
(1) AMENDMENT
OF
INTERNAL
REVENUE 
CODE.—
(A) IN
GENERAL.—Subparagraph (A) of 
section 417(a)(6) of the Internal Revenue Code 
of 1986 is amended by striking ‘‘90-day’’ and 
inserting ‘‘180-day’’. 
(B) MODIFICATION
OF
REGULATIONS.—
The Secretary of the Treasury shall modify the 
regulations under sections 402(f), 411(a)(11), 
and 417 of the Internal Revenue Code of 1986 
to substitute ‘‘180 days’’ for ‘‘90 days’’ each 
place it appears in Treasury Regulations sec-
tions 1.402(f)–1, 1.411(a)–11(c), and 1.417(e)–
1(b). 
(2) AMENDMENT OF ERISA.—
HR 1000 RFS 
(A) IN GENERAL.—Section 205(c)(7)(A) of 
the Employee Retirement Income Security Act 
of 1974 (29 U.S.C. 1055(c)(7)(A)) is amended 
by striking ‘‘90-day’’ and inserting ‘‘180-day’’. 
(B) MODIFICATION
OF
REGULATIONS.—
The Secretary of the Treasury shall modify the 
regulations under part 2 of subtitle B of title 
I of the Employee Retirement Income Security 
Act of 1974 to the extent that they relate to 
sections 203(e) and 205 of such Act to sub-
stitute ‘‘180 days’’ for ‘‘90 days’’ each place it 
appears. 
(3) EFFECTIVE DATE.—The amendments made 
by paragraphs (1)(A) and (2)(A) and the modifica-
tions required by paragraphs (1)(B) and (2)(B) 
shall apply to years beginning after December 31, 
2003. 
(b) CONSENT REGULATION INAPPLICABLE TO CER-
TAIN DISTRIBUTIONS.—
(1) IN GENERAL.—The Secretary of the Treas-
ury shall modify the regulations under section 
411(a)(11) of the Internal Revenue Code of 1986 
and under section 205 of the Employee Retirement 
Income Security Act of 1974 to provide that the de-
scription of a participant’s right, if any, to defer re-
HR 1000 RFS 
ceipt of a distribution shall also describe the con-
sequences of failing to defer such receipt. 
(2) EFFECTIVE DATE.—
(A) IN GENERAL.—The modifications re-
quired by paragraph (1) shall apply to years be-
ginning after December 31, 2003. 
(B) REASONABLE NOTICE.—In the case of 
any description of such consequences made be-
fore the date that is 90 days after the date on 
which the Secretary of the Treasury issues a 
safe harbor description under paragraph (1), a 
plan shall not be treated as failing to satisfy the 
requirements of section 411(a)(11) of such 
Code or section 205 of such Act by reason of 
the failure to provide the information required 
by the modifications made under paragraph (1) 
if the Administrator of such plan makes a rea-
sonable attempt to comply with such require-
ments. 
SEC. 207. ANNUAL REPORT DISSEMINATION. 
(a) REPORT AVAILABLE THROUGH ELECTRONIC 
MEANS.—Section 104(b)(3) of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1024(b)(3)) is 
amended by adding at the end the following new sentence: 
‘‘The requirement to furnish information under the pre-
HR 1000 RFS 
vious sentence with respect to an employee pension benefit 
plan shall be satisfied if the administrator makes such in-
formation reasonably available through electronic means 
or other new technology.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to reports for years beginning after 
December 31, 2003. 
SEC. 208. TECHNICAL CORRECTIONS TO SAVER ACT. 
Section 517 of the Employee Retirement Income Se-
curity Act of 1974 (29 U.S.C. 1147) is amended—
(1) in subsection (a), by striking ‘‘2001 and 
2005 on or after September 1 of each year involved’’ 
and inserting ‘‘2006 and 2010’’; 
(2) in subsection (e)(2)—
(A) by striking ‘‘Committee on Labor and 
Human Resources’’ in subparagraph (D) and 
inserting ‘‘Committee on Health, Education, 
Labor, and Pensions’’; 
(B) by striking subparagraph (F) and in-
serting the following: 
‘‘(F) the Chairman and Ranking Member 
of the Subcommittee on Labor, Health and 
Human Services, and Education of the Com-
mittee on Appropriations of the House of Rep-
resentatives and the Chairman and Ranking
HR 1000 RFS 
Member of the Subcommittee on Labor, Health 
and Human Services, and Education of the 
Committee on Appropriations of the Senate;’’; 
(C) by redesignating subparagraph (G) as 
subparagraph (J); and 
(D) by inserting after subparagraph (F) 
the following new subparagraphs: 
‘‘(G) the Chairman and Ranking Member 
of the Committee on Finance of the Senate; 
‘‘(H) the Chairman and Ranking Member 
of the Committee on Ways and Means of the 
House of Representatives; 
‘‘(I) the Chairman and Ranking Member 
of the Subcommittee on Employer-Employee 
Relations of the Committee on Education and 
the Workforce of the House of Representatives; 
and’’; 
(3) in subsection (e)(3)(B), by striking ‘‘Janu-
ary 31, 1998’’ and inserting ‘‘2 months before the 
convening of each summit’’; 
(4) in subsection (f)(1)(C), by inserting ‘‘, no 
later than 60 days prior to the date of the com-
mencement of the National Summit,’’ after ‘‘com-
ment’’; 
(5) in subsection (i)—
HR 1000 RFS 
(A) by striking ‘‘for fiscal years beginning 
on or after October 1, 1997,’’; and 
(B) by adding at the end the following new 
paragraph: 
‘‘(3) RECEPTION
AND
REPRESENTATION
AU-
THORITY.—The Secretary is hereby granted recep-
tion and representation authority limited specifically 
to the events at the National Summit. The Secretary 
shall use any private contributions accepted in con-
nection with the National Summit prior to using 
funds appropriated for purposes of the National 
Summit pursuant to this paragraph.’’; and 
(6) in subsection (k)—
(A) by striking ‘‘shall enter into a contract 
on a sole-source basis’’ and inserting ‘‘may 
enter into a contract on a sole-source basis’’; 
and 
(B) by striking ‘‘in fiscal year 1998’’. 
SEC. 209. MISSING PARTICIPANTS AND BENEFICIARIES. 
(a) IN GENERAL.—Section 4050 of the Employee Re-
tirement Income Security Act of 1974 (29 U.S.C. 1350) 
is amended by redesignating subsection (c) as subsection 
(e) and by inserting after subsection (b) the following new 
subsections:
HR 1000 RFS 
‘‘(c) MULTIEMPLOYER
PLANS.—The corporation 
shall prescribe rules similar to the rules in subsection (a) 
for multiemployer plans covered by this title that termi-
nate under section 4041A. 
‘‘(d) PLANS NOT OTHERWISE SUBJECT TO TITLE.—
‘‘(1) TRANSFER TO CORPORATION.—The plan 
administrator of a plan described in paragraph (4) 
may elect to transfer the benefits of a missing par-
ticipant or beneficiary to the corporation upon ter-
mination of the plan. 
‘‘(2) INFORMATION TO THE CORPORATION.—To 
the extent provided in regulations, the plan adminis-
trator of a plan described in paragraph (4) shall, 
upon termination of the plan, provide the corpora-
tion information with respect to benefits of a miss-
ing participant or beneficiary if the plan transfers 
such benefits—
‘‘(A) to the corporation, or 
‘‘(B) to an entity other than the corpora-
tion or a plan described in paragraph (4)(B)(ii).
‘‘(3) PAYMENT BY THE CORPORATION.—If ben-
efits of a missing participant or beneficiary were 
transferred to the corporation under paragraph (1), 
the corporation shall, upon location of the partici-
pant or beneficiary, pay to the participant or bene-
HR 1000 RFS 
ficiary the amount transferred (or the appropriate 
survivor benefit) either—
‘‘(A) in a single sum (plus interest), or 
‘‘(B) in such other form as is specified in 
regulations of the corporation. 
‘‘(4) PLANS DESCRIBED.—A plan is described 
in this paragraph if—
‘‘(A) the plan is a pension plan (within the 
meaning of section 3(2))—
‘‘(i) to which the provisions of this 
section do not apply (without regard to 
this subsection), and 
‘‘(ii) which is not a plan described in 
paragraphs (2) through (11) of section 
4021(b), and 
‘‘(B) at the time the assets are to be dis-
tributed upon termination, the plan—
‘‘(i) has one or more missing partici-
pants or beneficiaries, and 
‘‘(ii) has not provided for the transfer 
of assets to pay the benefits of all missing 
participants and beneficiaries to another 
pension plan (within the meaning of sec-
tion 3(2)).
HR 1000 RFS 
‘‘(5) CERTAIN PROVISIONS NOT TO APPLY.—
Subsections (a)(1) and (a)(3) shall not apply to a 
plan described in paragraph (4).’’. 
(b) CONFORMING AMENDMENTS.—Section 206(f) of 
such Act (29 U.S.C. 1056(f)) is amended—
(1) by striking ‘‘title IV’’ and inserting ‘‘section 
4050’’; and 
(2) by striking ‘‘the plan shall provide that,’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to distributions made after final 
regulations implementing subsections (c) and (d) of sec-
tion 4050 of the Employee Retirement Income Security 
Act of 1974 (as added by subsection (a)), respectively, are 
prescribed. 
SEC. 210. REDUCED PBGC PREMIUM FOR NEW PLANS OF 
SMALL EMPLOYERS. 
(a) IN GENERAL.—Subparagraph (A) of section 
4006(a)(3) of the Employee Retirement Income Security 
Act of 1974 (29 U.S.C. 1306(a)(3)(A)) is amended—
(1) in clause (i), by inserting ‘‘other than a new 
single-employer plan (as defined in subparagraph 
(F)) maintained by a small employer (as so de-
fined),’’ after ‘‘single-employer plan,’’, 
(2) in clause (iii), by striking the period at the 
end and inserting ‘‘, and’’, and
HR 1000 RFS 
(3) by adding at the end the following new 
clause: 
‘‘(iv) in the case of a new single-employer plan 
(as defined in subparagraph (F)) maintained by a 
small employer (as so defined) for the plan year, $5 
for each individual who is a participant in such plan 
during the plan year.’’. 
(b) 
DEFINITION
OF
NEW
SINGLE-EMPLOYER 
PLAN.—Section 4006(a)(3) of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1306(a)(3)) is 
amended by adding at the end the following new subpara-
graph: 
‘‘(F)(i) For purposes of this paragraph, a single-em-
ployer plan maintained by a contributing sponsor shall be 
treated as a new single-employer plan for each of its first 
5 plan years if, during the 36-month period ending on the 
date of the adoption of such plan, the sponsor or any 
member of such sponsor’s controlled group (or any prede-
cessor of either) did not establish or maintain a plan to 
which this title applies with respect to which benefits were 
accrued for substantially the same employees as are in the 
new single-employer plan. 
‘‘(ii)(I) For purposes of this paragraph, the term 
‘small employer’ means an employer which on the first day 
of any plan year has, in aggregation with all members of
HR 1000 RFS 
the controlled group of such employer, 100 or fewer em-
ployees. 
‘‘(II) In the case of a plan maintained by two or more 
contributing sponsors that are not part of the same con-
trolled group, the employees of all contributing sponsors 
and controlled groups of such sponsors shall be aggregated 
for purposes of determining whether any contributing 
sponsor is a small employer.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to plans first effective after Decem-
ber 31, 2003. 
SEC. 211. REDUCTION OF ADDITIONAL PBGC PREMIUM FOR 
NEW AND SMALL PLANS. 
(a) NEW PLANS.—Subparagraph (E) of section 
4006(a)(3) of the Employee Retirement Income Security 
Act of 1974 (29 U.S.C. 1306(a)(3)(E)) is amended by 
adding at the end the following new clause: 
‘‘(v) In the case of a new defined benefit plan, the 
amount determined under clause (ii) for any plan year 
shall be an amount equal to the product of the amount 
determined under clause (ii) and the applicable percent-
age. For purposes of this clause, the term ‘applicable per-
centage’ means—
‘‘(I) 0 percent, for the first plan year. 
‘‘(II) 20 percent, for the second plan year.
HR 1000 RFS 
‘‘(III) 40 percent, for the third plan year. 
‘‘(IV) 60 percent, for the fourth plan year. 
‘‘(V) 80 percent, for the fifth plan year. 
For purposes of this clause, a defined benefit plan (as de-
fined in section 3(35)) maintained by a contributing spon-
sor shall be treated as a new defined benefit plan for each 
of its first 5 plan years if, during the 36-month period 
ending on the date of the adoption of the plan, the sponsor 
and each member of any controlled group including the 
sponsor (or any predecessor of either) did not establish 
or maintain a plan to which this title applies with respect 
to which benefits were accrued for substantially the same 
employees as are in the new plan.’’. 
(b) SMALL
PLANS.—Paragraph (3) of section 
4006(a) of the Employee Retirement Income Security Act 
of 1974 (29 U.S.C. 1306(a)), as amended by section 
210(b), is amended—
(1) by striking ‘‘The’’ in subparagraph (E)(i) 
and inserting ‘‘Except as provided in subparagraph 
(G), the’’, and
(2) by inserting after subparagraph (F) the fol-
lowing new subparagraph: 
‘‘(G)(i) In the case of an employer who has 25 or 
fewer employees on the first day of the plan year, the addi-
tional premium determined under subparagraph (E) for
HR 1000 RFS 
each participant shall not exceed $5 multiplied by the 
number of participants in the plan as of the close of the 
preceding plan year. 
‘‘(ii) For purposes of clause (i), whether an employer 
has 25 or fewer employees on the first day of the plan 
year is determined by taking into consideration all of the 
employees of all members of the contributing sponsor’s 
controlled group. In the case of a plan maintained by two 
or more contributing sponsors, the employees of all con-
tributing sponsors and their controlled groups shall be ag-
gregated for purposes of determining whether the 25-or-
fewer-employees limitation has been satisfied.’’. 
(c) EFFECTIVE DATES.—
(1) SUBSECTION (a).—The amendments made 
by subsection (a) shall apply to plans first effective 
after December 31, 2003. 
(2) SUBSECTION (b).—The amendments made 
by subsection (b) shall apply to plan years beginning 
after December 31, 2003. 
SEC. 212. AUTHORIZATION FOR PBGC TO PAY INTEREST ON 
PREMIUM OVERPAYMENT REFUNDS. 
(a) IN GENERAL.—Section 4007(b) of the Employ-
ment Retirement Income Security Act of 1974 (29 U.S.C. 
1307(b)) is amended—