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It is the practice of the Department of Labor to answer
inquiries of individuals or organizations affected, directly or
indirectly, by the Employee Retirement Income Security Act of 1974 (Pub.
L. 93-406, hereinafter the Act) as to their status under the
Act and as to the effect of certain acts and transactions. The answers to
such inquiries are categorized as information letters and advisory
opinions. This ERISA procedure describes the general procedures of the department in issuing
information letters and advisory opinions under the Act, and is designed
to promote efficient handling of inquiries and to facilitate prompt
responses.
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Section 7 of this procedure is
reserved and will set forth the procedures to be followed to obtain an
advisory opinion relating to prohibited transactions and common definitions,
such as whether a person is a party in interest and a disqualified person.
In general, this section will incorporate a revenue procedure to be
published by the Internal Revenue Service.
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The purpose of this ERISA Procedure is to describe the general procedures of
the Department of Labor in issuing information letters and advisory opinions
to individuals and organizations under the Employee Retirement Income
Security Act of 1974 (Pub. L. 93-406), hereinafter referred to as the Act. This ERISA Procedure also informs individuals and organizations,
and their authorized representatives, where they may direct requests for
information letters and advisory opinions, and outlines procedures to be
followed in order to promote efficient handling of their inquiries.
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It is the practice of the department to answer inquiries of individuals and
organizations, whenever appropriate, and in the interest of sound
administration of the Act, as to their status under the Act and as to the
effects of their acts or transactions. One of the functions of the department
is to issue information letters and advisory opinions in such matters.
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An information letter is a written statement issued either by the
Pension and Welfare Benefit Programs (Office of Employee Benefits Security),
U.S. Department of Labor, Washington, D.C. or a Regional Office or an Area
Office of the Labor-Management Services Administration, U.S. Department of
Labor, that does no more than call attention to a well-established
interpretation or principle of the Act, without applying it to a specific
factual situation. An information letter may be issued to any individual or
organization when the nature of the request from the individual or the
organization suggests that it is seeking general information, or where the
request does not meet all the requirements of section 6 or
section 7 of this
procedure, and it is believed that such general information will assist the
individual or organization.
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An advisory opinion is a written statement issued to an individual or
organization, or to the authorized representative of such individual or
organization, by the Administrator of Pension and Welfare Benefit Programs
or his delegate, that interprets and applies the Act to a specific factual
situation. Advisory opinions are issued only by the Administrator of Pension
and Welfare Benefit Programs or his delegate.
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Individuals and organizations are those persons described in
section 4 of this procedure.
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Any individual or organization affected directly or indirectly, by the Act
may request an information letter or an advisory opinion from the department.
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A request by or for an individual or organization must be signed by the
individual or organization, or by the authorized representative of such
individual or organization. See section 7 of this procedure.
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The department will issue advisory opinions involving the interpretation of
the application of one or more sections of the Act, regulations promulgated
under the Act, interpretive bulletins, or exemptions issued by the department
to a specific factual situation. Generally, advisory opinions will be issued
by the department only with respect to prospective transactions (i.e., a
transaction which will be entered into). Moreover, there are certain areas
where, because of the inherently factual nature of the problem involved, or
because the subject of the request for opinion is under investigation for a
violation of the Act, the department ordinarily will not issue advisory
opinions. Generally, an advisory opinion will not be issued on alternative
courses of proposed transactions, or on hypothetical situations, or where
all parties involved are not sufficiently identified and described, or where
material facts or details of the transaction are omitted.
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The department ordinarily will not issue advisory opinions relating to the
following sections of the Act:
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Section 3(18), relating to whether certain consideration constitutes
adequate consideration
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Section 3(26), relating to whether the valuation of any asset is at
current value
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Section 3(27), relating to whether the valuation of any asset is at
present value
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Section 102(a)(1), relating to whether a summary plan description is
written in a manner calculated to be understood by the average
participant
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Section 103(a)(3)(A), relating to whether the financial statements and
schedules required to be included in the Annual Report are presented
fairly in conformity with generally accepted accounting principles
applied on a consistent basis
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Section 103(b)(1), relating to whether a matter must be included in a
financial statement in order to fully and fairly present the financial
statement of the plan
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Section 202 (other than section 202(a)(3) and (b)(1)) relating to
minimum participation standards
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Section 203 (other than sections 202(a)(3)(B), (b)(1) (flush
language), (b)(2), (b)(3)(A)
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Section 204 of the Act (other than sections 204(b)(1)(B), (b)(1)(A),
(C), (D), (E)), relating to benefit accrual requirements
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Section 205(e), relating to the period during which a participant may
elect in writing not to receive a joint and survivor annuity
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Section 208, relating to mergers and consolidation of plans or
transfer of plan assets
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Section 209(a)(1), relating to whether the report required by section
209(a)(1) is sufficient to inform the employee of his accrued benefits
under the plan, etc.
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Sections 302 through 305, relating to minimum funding standards
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Section 403(c)(1), relating to the purposes for which plan assets must
be held
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Section 404(a), relating to fiduciary duties as applied to particular
conduct
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Section 407(a)(2) and (3) and (c)(1), relating to fair market value,
as applied to whether the value of any particular security or real
property constitutes fair market value
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This list is not all inclusive and the department may decline to issue
advisory opinions relating to other sections of the Act whenever warranted
by the facts and circumstances of a particular case. The department may,
when it is deemed appropriate and in the best interest of sound
administration of the Act, issue information letters calling attention to
established principles under the Act, even though the request that was
submitted was for an advisory opinion.
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Pending the adoption of regulations (either temporary or final) involving
the interpretation of the application of a provision of the Act,
consideration will be given to the issuance of advisory opinions relating to
such provisions of the Act only under the following conditions:
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If an inquiry presents an issue on which the answer seems to be clear
from the application of the provisions of the Act to the facts
described, the advisory opinion will be issued in accordance with the
procedures contained herein.
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If an inquiry presents an issue on which the answer seems reasonably
certain but not entirely free from doubt, an advisory opinion will be
issued only if it is established to the satisfaction of the department,
that a business emergency requires an advisory opinion or that unusual
hardship to the plan or its participants and beneficiaries will result
from failure to obtain an advisory opinion. In any case in which the
individual or organization believes that a business emergency exists or
that an unusual hardship to the plan or its participants and
beneficiaries will result from the failure to obtain an advisory
opinion, the individual or organization should submit with the request a
separate letter setting forth the facts necessary for the department to
make a determination in this regard. In this connection, the department
will not deem a business emergency to result from
circumstances within the control of the individual or organization such
as, for example, scheduling within an inordinately short time the
closing date of a transaction or a meeting of the Board of Directors or
the shareholders of a corporation.
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If an inquiry presents an issue that cannot be reasonably resolved
prior to the issuance of a regulation, an advisory opinion will not be
issued.
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The department ordinarily will not issue advisory opinions on the form
or effect in operation of a plan, fund, or program (or a particular
provision or provisions thereof) subject to Title I of the Act. For
example, the department will not issue an advisory opinion on whether a
plan satisfies the requirements of Parts 2 and 3 of Title I of the Act.
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If an advisory opinion is desired, a request should be submitted to:
U.S. Department of Labor
Employee Benefits Security Administration
Office of Regulations and Interpretations
200 Constitution Avenue, NW, Suite N-5669
Washington, DC 20210
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A request for an advisory opinion must contain the following information:
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The name and type of plan or plans (e.g., pension, profit-sharing, or
welfare plan); the Employer Identification Number (EIN); the Plan Number
(PN) used by the plan in reporting to the Department of Labor on Form
EBS-1 or a copy of the first two pages of the most recent Form EBS-1
filed with the department.
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A detailed description of the act or acts or transaction or
transactions with respect to which an advisory opinion is requested.
Where the request pertains to only one step of a larger integrated act
or transaction, the facts, circumstances, etc., must be submitted with
respect to the entire transaction. In addition, a copy of all documents
submitted must be included in the individual's or organization's
statement and not merely incorporated by reference, and must be
accompanied by an analysis of their bearing on the issue or issues,
specifying the pertinent provisions.
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A discussion of the issue or issues presented by the act or acts or
transaction or transactions which should be addressed in the advisory
opinion.
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If the individual or organization is requesting a particular advisory
opinion, the requesting party must furnish an explanation of the grounds
for the request, together with a statement of relevant supporting
authority. Even though the individual or organization is urging no
particular determination with regard to a proposed or prospective act or
acts or transaction or transactions, the party requesting the ruling
must state such party's views as to the results of the proposed act or
acts or transaction or transactions and furnish a statement of relevant
authority to support such views.
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A request for an advisory opinion by or for an individual or
organization must be signed by the individual or organization or by the
individual's or organization's authorized representative. If the request
is signed by a representative of an individual or organization, or the
representative may appear before the department in connection with the
request, the request must include a statement that the representative is
authorized to represent the individual or organization.
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A request for an advisory opinion that does not comply with all the
provisions of this procedure will be acknowledged, and the requirements
that have not been met will be noted. Alternatively, at the discretion
of the department, the department will issue an information letter to
the individual or organization.
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If the individual or organization or the authorized representative,
desires a conference in the event the department contemplates issuing an
adverse advisory opinion, such desire should be stated in writing when
filing the request or soon thereafter in order that the department may
evaluate whether in the sole discretion of the department, a conference
should be arranged and at what stage of the consideration a conference
would be most helpful.
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It is the practice of the department to process requests for
information letters and advisory opinions in regular order and as
expeditiously as possible. Compliance with a request for consideration
of a particular matter ahead of its regular order, or by a specified
time, tends to delay the disposition of other matters. Requests for
processing ahead of the regular order, made in writing (submitted with
the request or subsequent thereto) and showing clear need for such
treatment, will be given consideration as the particular circumstances
warrant. However, no assurance can be given that any letter will be
processed by the time requested. The department will not consider a need
for expedited handling to arise if the request shows such need has
resulted from circumstances within the control of the person making the
request.
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An individual or organization, or the authorized representative
desiring to obtain information relating to the status of his or her
request for an advisory opinion may do so by contacting the Office of
Regulatory Standards and Exceptions, Pension and Welfare Benefit
Programs, U.S. Department of Labor, Washington, D.C.
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[Reserved]
[Reserved]
[Reserved]
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If a conference has been requested and the department determines that a
conference is necessary or appropriate, the individual or organization or
the authorized representative will be notified of the time and place of the
conference.
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A conference will normally be scheduled only when the department
in its sole discretion deems it will be necessary or appropriate in deciding
the case. If conferences are being arranged with respect to more than one
request for an opinion letter involving the same individual or organization,
they will be so scheduled as to cause the least inconvenience to the
individual or organization.
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The individual or organization's request for an advisory opinion may be
withdrawn at any time prior to receipt of notice that the department intends
to issue an adverse opinion, or the issuance of an opinion. Even though a
request is withdrawn, all correspondence and exhibits will be retained by
the department and will not be returned to the individual or organization.
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An advisory opinion is an opinion of the department as to the application of
one or more sections of the Act, regulations promulgated under the Act,
interpretive bulletins, or exemptions. The opinion assumes that all material
facts and representations set forth in the request are accurate, and applies
only to the situation described therein. Only the parties described in the
request for opinion may rely on the opinion, and they may rely on the
opinion only to the extent that the request fully and accurately contains
all the material facts and representations necessary to issuance of the
opinion and the situation conforms to the situation described in the request
for opinion.
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An information letter issued by the department is informational only and is
not binding on the department with respect to any particular factual
situation.
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Advisory opinions shall be open to public inspection at the Public
Disclosure Room, U.S. Department of Labor, 200 Constitution Avenue, N.W.,
Washington, D.C. 20216.
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Background files (including the request for an advisory opinion,
correspondence between the department and the individual or organization
requesting the advisory opinion) shall be available upon written request.
Background files may be destroyed after three years from the date of
issuance.
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Advisory opinions will be modified to delete references to proprietary
information prior to disclosure. Any information considered to be
proprietary should be so specified in a separate letter at the time of
request. Other than proprietary information, all materials contained in the
public files shall be available for inspection pursuant to section
12.
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The cost of search, copying and deletion of any references to proprietary
information will be borne by the person requesting the advisory opinion or
the background file.
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This advisory opinion procedure consists of rules of
agency procedure and practice, and is therefore excepted under 5 U.S.C.
552(b)(3)(A) of the Administrative Procedure Act from the ordinary notice
and comment provisions for agency rulemaking. Accordingly, the procedure is
effective August 27, 1976, the date of
its publication in the Federal Register.
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Signed at Washington, DC, this 24th day of August 1976
James D. Hutchinson
Administrator of Pension and Welfare Benefit Programs
U.S. Department of Labor
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