The U.S. Department of Labor has issued a 60-day extension to the fiduciary rule and related exemptions, including the Best Interest Contract Exemption.
The announcement follows a Feb. 3, 2017, presidential memorandum, which directed the department to examine whether the fiduciary rule adversely affects the ability of Americans to gain access to financial advice.
Under the terms of the extension, advisers to retirement investors will be treated as fiduciaries and have an obligation to give advice that adheres to “impartial conduct standards” beginning on June 9, rather than on April 10, 2017, as originally scheduled, says the department in a release.
The fiduciary standards require advisers to adhere to a best interest standard, charge no more than reasonable compensation for their services and refrain from making misleading statements.
Between now and January 1, 2018, when all the exemptions’ conditions are scheduled to become fully applicable, the department says it will complete a review and decide whether to make or propose further changes to the fiduciary rule or associated exemptions.
In the absence of further action, the delay doesn’t affect the requirement to enter into a best interest contract and other requirements that are currently scheduled for Jan. 1, 2018, the department says.
Also read: Investors want a best interest standard