In response to an Executive Order from the White House to identify opportunities to make government regulations less burdensome and more effective, the Pension Benefit Guaranty Corporation (PBGC) recently published its Preliminary Plan for Regulatory Review. Most notably, PBGC noted that it had begun implementing the Executive Order by reconsidering several rules it has recently proposed:
- Reportable Events: PBGC announced it was already planning to re-propose regulations regarding reportable events under Section 4043 of the Employment Retirement Income Security Act (ERISA).
- ERISA Section 4062(e): PBGC announced it will also reconsider its proposed rule regarding the substantial cessation of operations by employers that maintain defined benefit pension plans in light of public comments. As previously noted by our Firm and several industry groups, the proposed rule had the potential to impose unexpected and extensive liability for employers who undertake routine corporate actions.
In addition, according to the Preliminary Plan, PBGC intends to review the following rules:
- Voluntary Correction Programs: PBGC will consider whether to expand its current voluntary correction program for errors related to filings and other requirements.
- Premiums: PBGC will review the premium payment requirements for small plans to determine whether changes could be made that would enable small plans to streamline their premium and funding valuation procedures.
- ERISA Section 4010: PBGC will review ERISA Section 4010 (Annual Financial and Actuarial Information Reporting) and the filing application to determine whether the burden on employers can be reduced.
PBGC also intends to review various other sections of Title IV of ERISA to delete obsolete regulations or incorrect references, fill-in gaps where additional guidance would be helpful and simplify language.
President Obama’s Executive Order called for an "open exchange" of information among government officials, experts, stakeholders and the public. Accordingly, the PBGC is accepting public comments on its Preliminary Plan. For more information regarding submitting comments, click here.