PSNC 2017: Washington Update

Top ERISA attorneys give their best predictions about how tax reform, open MEPs, fiduciary rulemaking and other regulatory and legislative matters will evolve under Republican leadership.

By John Manganaro | June 08, 2017
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The 2017 PLANSPONSOR National Conference kicked off Wednesday afternoon in Washington D.C.’s Renaissance Hotel.

The setting, barely a mile from both the U.S. Capitol and the White House, could not have been more appropriate for the conference’s popular recurring session: The Washington Update.

Featured on the panel this year were Bradford Campbell, partner, Drinker Biddle & Reath LLP, and former assistant secretary of labor overseeing the Department of Labor (DOL)’s Employee Benefits Security Administration (EBSA) under President George W. Bush; as well as Michael Kreps, principal, Groom Law Group Chartered, and former senior pensions and employment counsel for the U.S. Senate Committee on Health, Education, Labor and Pensions from the 110th through the 114th Congresses.

Even with those impressive credentials, both Campbell and Kreps freely admitted this is a vexing and even a bit frustrating time from the perspective of trying to get in front of potential major regulatory and legislative change. One just has to look at the example set by the ongoing fiduciary rule kerfuffle to see the challenge.

Just in the last year, the fiduciary rule’s future has seemingly flipped at least two or three times, Kreps and Campbell said, starting with the election of Donald Trump and the bicameral Republican majority in the U.S. Congress. Given the new president’s and the GOP’s rhetorical stance towards government regulation of financial markets, it was naturally assumed that the fiduciary rule would, by one mechanism or another, be prevented from taking effect.

However, the full Congress has failed as yet to pass any measures impacting the fiduciary rule implementation, and the new administration took four full months to fill the position of labor secretary. This left Alexander Acosta precious little time to begin the process of somehow removing or revising the rulemaking prior to its first implementation deadlines. Trump’s DOL managed to delay the rulemaking’s earliest compliance deadlines, from April to June, but it has given up trying to fully halt the implementation—coming imminently on June 9.

Campbell and Kreps both suggested that the future of the fiduciary rule, even now that the implementation is picking up steam, is far from set in stone. Congress could still certainly find a way to successfully move, as it has attempted to before, to repeal the rule in full and then require the Securities and Exchange Commission (SEC) to set any new advice standards. The CHOICE Act, which has recently passed the House Financial Services Committee, for example, seeks to do just that.

NEXT: Uncertainty still reigns