The Office of Management and Budget (OMB) confirmed receipt of the Department of Labor’s (DOL) hard-fought fiduciary regulation, which now stands in final form.
To be clear, investment and retirement plan industry professionals will have to wait a little longer to actually see the final fiduciary rule, and compare it to the proposed regulation language published last year. There could be substantial changes included in the rule language currently being looked at by OMB, but given the fact that comment periods on the regulations ended fairly recently, it is unclear whether major changes could or would have been made in that time.
Interestingly, the news that OMB is reviewing a final fiduciary rule comes despite Labor Secretary Thomas Perez’s comments just this week that implied reports that the conflict of interest rule would be sent to OMB soon were incorrect. Perez had said the DOL was still “neck deep” in the process of reviewing the significant number of comments submitted in last fall’s comment period and “hopes to reach a conclusion in the coming months,” which would indicate some changes to the rulemaking language are certainly possible.
In any case, the news that a final fiduciary rule has been formed and submitted to OMB is certain to irk many in the investment and retirement plan industries. In just the last few weeks several groups again voiced concerned with where the proposal is heading, what’s in it and how fast it’s moving. One group wants to defund the DOL initiative via Congress, while another group is suggesting the DOL be required to re-propose the rule with another short comment period next year. That move would significantly change the timing of the issuance and effective date of the rule and give interested parties an opportunity to see how the DOL may be resolving concerns raised during the first comment period.
Traditionally the OMB has 60 to 90 days to review regulations of this nature and to make public the final rule language, but given the limited time the current administration has in office and the high-profile nature of the rule, OMB may also use its discretion for an expedited review.