On April 6, the Department of Labor released its long awaited final fiduciary rule, which expands the reach of ERISA’s definition of “fiduciary” by redefining when a person is treated as rendering investment advice. Under the final rule, a wider array of relationships will give rise to fiduciary status for those who work with retirement plans.

Since the final rule was published, much of the discussion has focused on the effect it will have on investment advisors, leaving employers and plan sponsors left to wonder how the new rule will affect their plans.

Here are some important take away points from the final rule for plan sponsors:

The BICE requirements are streamlined for financial institutions and advisors who only receive a level fee in connection with advisory or investment management services. As a result, plan sponsors may see advisors move to level fee arrangements. These arrangements should be reviewed to ensure that they comply with the BICE rules.

Applicability Date. The expanded definition of fiduciary will go into effect April 10, 2017, and the requirements of the BICE (as well as the Principal Transaction Exemption, which is not covered here) will be phased in over a period between April 10, 2017 and December 31, 2017.

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