[Federal Register Volume 64, Number 150 (Thursday, August 5, 1999)]
[Proposed Rules]
[Pages 42792-42797]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-19860]


      

[[Page 42791]]

_______________________________________________________________________

Part III





Department of Labor





_______________________________________________________________________



Pension and Welfare Benefits Administration



_______________________________________________________________________



29 CFR Parts 2520, 2560 and 2570



Removal of Superseded Regulations Relating to Plan Descriptions and 
Summary Plan Descriptions; Proposed Rule



Furnishing Documents to the Secretary of Labor on Request Under ERISA 
Section 104(a)(6) and Assessment of Civil Penalties Under ERISA Section 
502(c)(6); Proposed Rule

  Federal Register / Vol. 64, No. 150 / Thursday, August 5, 1999 / 
Proposed Rules  

[[Page 42792]]


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DEPARTMENT OF LABOR

Pension and Welfare Benefits Administration

29 CFR Parts 2520 and 2560

RIN 1210-AA66


Removal of Superseded Regulations Relating to Plan Descriptions 
and Summary Plan Descriptions, and Other Technical Conforming 
Amendments

AGENCY: Pension and Welfare Benefits Administration, Department of 
Labor.

ACTION: Notice of Proposed Rulemaking.

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SUMMARY: This document sets forth a proposed rule that would remove 
certain provisions from the Code of Federal Regulations (CFR) that were 
superseded, in whole or in part, by amendments of the Employee 
Retirement Income Security Act of 1974 (ERISA) enacted as part of the 
Taxpayer Relief Act of 1997 (TRA '97). These TRA '97 amendments 
eliminated the requirements that plan administrators file summary plan 
descriptions (SPDs) and summaries of material modifications (SMMs) with 
the Department of Labor (Department). The amendments also eliminated 
all requirements pertaining to plan descriptions. In addition to 
removing superseded regulations from the CFR, this proposed rule would 
make miscellaneous technical amendments to the CFR designed to correct 
affected cross-references.

DATES: Written comments concerning the proposed regulation must be 
received by October 4, 1999.

ADDRESSES: Written comments (preferably three copies) should be sent 
to: Office of Regulations and Interpretations, Room N-5669, Pension and 
Welfare Benefits Administration, U.S. Department of Labor, 200 
Constitution Avenue, NW, Washington, DC 20210; Attention: Proposed SPD/
Plan Description Regulations. All submissions will be open to public 
inspection at the Public Documents Room, Pension and Welfare Benefits 
Administration, Room N-5638, 200 Constitution Avenue, NW, Washington, 
DC.

FOR FURTHER INFORMATION CONTACT: Jeffrey J. Turner, Office of 
Regulations and Interpretations, Pension and Welfare Benefits 
Administration, U.S. Department of Labor, (202) 219-8671 (not a toll-
free number).

SUPPLEMENTARY INFORMATION:

1. Overview

    TRA '97 amended sections 101(b), 102, and 104(a)(1) of ERISA to 
eliminate the requirements that plan administrators file SPDs, SMMs, 
and plan descriptions with the Department.1 TRA '97 also 
amended section 104(b) of ERISA to eliminate the requirement that plan 
administrators furnish plan descriptions to participants and 
beneficiaries. These statutory amendments superseded, in whole or in 
part, the Department's regulations that implemented the SPD, SMM, and 
plan description filing requirements. This proposed rule would remove 
those superseded regulations from the CFR.2 This proposed 
rule also would make several technical conforming amendments to reflect 
the fact that regulatory relief from certain plan description, SPD, and 
SMM requirements is no longer needed in light of TRA '97 and to correct 
affected regulatory and statutory cross-references in parts 2520 and 
2560 of Chapter XXV of Title 29 of the CFR. A chart identifying each 
regulation that would be changed by this proposed rule is printed 
below.
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    \1\ Prior to 1979, the administrator of an employee benefit plan 
subject to the provisions of Part 1 of Title I of ERISA was required 
to file with the Department a plan description (Form EBS-1) to 
satisfy the statutory filing requirements of section 104(a) and 29 
CFR 2520.104a-2. See 41 FR 16957 (April 23, 1976). In 1979, the 
Department amended 29 CFR 2520.104a-2 (44 FR 31639 (June 1, 1979)), 
to provide that the administrator of an employee benefit plan would 
satisfy the plan description filing requirements of section 
104(a)(1)(B) by filing with the Department a SPD and an updated SPD 
in accordance with section 104(a)(1)(C) and the regulations 
thereunder.
    \2\ Under a separate notice, the Department will promulgate 
proposed regulations to implement new sections 502(c)(6) and 
104(a)(6) of ERISA. Section 502(c)(6) provides that if, within 30 
days of a request by the Department to a plan administrator for 
documents under section 104(a)(6), the plan administrator fails to 
furnish the material requested to the Department, the Department may 
assess a civil penalty against the plan administrator of up to $100 
a day from the date of such failure, but in no event in excess of 
$1,000 per request. Section 104(a)(6) provides that the 
administrator of any employee benefit plan must furnish to the 
Department, upon request, any documents relating to the employee 
benefit plan, including but not limited to, the latest SPD, and the 
bargaining agreement, trust agreement, contract, or other instrument 
under which the plan is established or operated.
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2. Removal of Superseded Regulations

    This proposed rule would remove, in whole or in part, the following 
superseded regulations from 29 CFR part 2520, which pertain to 
reporting and disclosure under ERISA. This proposed rule also would 
reserve certain removed sections of the CFR to preserve the continuity 
of codification in the CFR.

A. Regulations Superseded in Whole

    This proposed rule would remove and reserve Secs. 2520.102-1 and 
2520.104a-2. These sections require plan administrators to file a plan 
description with the Department in accordance with Secs. 101(b)(2) and 
104(a)(1)(B) of ERISA.3 They were superseded by paragraphs 
(a) and (c) of Sec. 1503 of TRA '97, which eliminated Secs. 101(b)(2) 
and 104(a)(1)(B) of ERISA.
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    \3\ See supra note 1.
---------------------------------------------------------------------------

    This proposed rule would remove and reserve Sec. 2520.104a-3. This 
section implements sections 101(b)(1) and 104(a)(1)(C) of ERISA, which 
require plan administrators to file with the Department a copy of any 
SPD that is required to be furnished to participants covered under the 
plan and beneficiaries receiving benefits under the plan. Section 
2520.104a-3 was superseded by paragraphs (a) and (c) of section 1503 of 
TRA '97, which eliminated sections 101(b)(1) and 104(a)(1)(C) of ERISA.
    This proposed rule would remove and reserve Secs. 2520.104a-4 and 
2520.104a-7. These sections implement Secs. 101(b)(3), 102(a)(2), and 
104(a)(1)(D) of ERISA, which require plan administrators to file with 
the Department a copy of summaries of material modifications in the 
terms of the plan and summaries of any changes in the information 
required to be in the SPD. Sections 2520.104a-4 and 2520.104a-7 were 
superseded by paragraphs (a) and (c) of Sec. 1503 of TRA '97, which 
eliminated Secs. 101(b)(3), 102(a)(2), and 104(a)(1)(D) of ERISA.

B. Regulations Superseded in Part

    This proposed rule would amend Sec. 2520.104-20 to reflect the fact 
that certain of the reporting relief granted by that regulation is no 
longer needed in light of TRA '97. Specifically, Sec. 2520.104-20 
exempts certain unfunded or insured welfare plans with fewer than 100 
participants from, among others, the requirements to file plan 
descriptions, SPDs, and SMMs with the Department. Inasmuch as plan 
descriptions, SPDs, and SMMs are no longer required to be filed under 
ERISA as amended by TRA '97, this proposed rule would amend 
Sec. 2520.104-20(a) to remove the provisions that grant relief from 
such filing requirements. The amendments made by this proposed rule 
would not otherwise change the relief available in Sec. 2520.104-20.
    This proposed rule would similarly amend Sec. 2520.104-21 to 
reflect the fact that the SPD, SMM, and plan description filing relief 
granted by that regulation is no longer needed in light of the TRA '97 
elimination of those filing requirements. Specifically, Sec. 2520.104-
21 provides a limited

[[Page 42793]]

exemption from, among others, the requirements to file SPDs, SMMs, and 
plan descriptions with the Department for welfare benefit plans that 
cover fewer than 100 participants at the beginning of the plan year, 
are part of a group insurance arrangement, and that otherwise satisfy 
the conditions of Sec. 2520.104-21(b). This proposed rule would amend 
Sec. 2520.104-21(a) by removing the provisions on SPDs, SMMs, and plan 
descriptions because these documents are no longer required to be filed 
under ERISA as amended by TRA '97. The amendments made by this proposed 
rule would not otherwise change the relief available in Sec. 2520.104-
21.4
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    \4\ See 63 FR 68370, 68388 (Dec. 10, 1998) (eliminating 
references to requirements to file plan descriptions, SPDs, and SMMs 
in Sec. 2520.104-21-(d)(3) as part of proposed amendments to annual 
reporting regulations).
---------------------------------------------------------------------------

    This proposed rule would further amend Secs. 2520.104-20 and 
2520.104-21 to reflect the fact that the need for relief under ERISA 
from the requirement to disclose plan descriptions was eliminated by 
TRA '97. These section exempt eligible welfare plans from the 
requirement to: (1) Furnish upon written request of any participant or 
beneficiary a copy of the plan description, and (2) make copies of the 
plan description available in the principle office of the administrator 
and such other places as may be necessary for examination by any 
participant or beneficiary. This proposed rule would amend 
Secs. 2520.104-20(a)(2) and (3) and 2520.104-21(a)(1) and (2) by 
removing the provisions on disclosing plan descriptions because plan 
descriptions are nolonger required to be furnished or made available 
under ERISA as amended by TRA '97.
    This proposed rule would amend Secs. 2520.104-26 and 2520.104-27 to 
reflect the fact that the need for relief under ERISA from the 
requirement to file plan descriptions, SPDs, and SMMs was eliminated by 
TRA '97. These regulations provide certain unfunded dues financed 
welfare and pension plans maintained by employee organizations with a 
limited exemption from, among others, the requirement to file plan 
descriptions and a simplified option for complying with the filing and 
disclosure requirements applicable to SPDs. This proposed rule would 
amend Secs. 2520.104-26 and 2520.104-27 by removing the provisions on 
plan descriptions and would further amend Secs. 2520.104-26 and 
2520.104-27 to remove the simplified option provisions for filing SPDs 
because plan descriptions and SPDs are no longer required to be filed 
with the Department under ERISA as amended by TRA '97. The proposal is 
not otherwise intended to change the relief available under these 
sections.

3. Technical Conforming Amendments

    This proposal also would make technical changes that are needed to 
conform certain cross references in the CFR to sections of ERISA as 
amended by TRA '97. For example, Sec. 2520.104a-5 refers to section 
104(a)(1)(A) of ERISA as the authority for the requirement to file 
annual reports with the Department. After TRA '97, the correct citation 
is to Sec. 104(a)(1) of ERISA. Similar technical changes are also being 
made to conform internal CFR cross references.

4. Effective Date

    This regulation is proposed to be effective 60 days after 
publication of a final rule in the Federal Register. If adopted, the 
proposed amendments implementing TRA '97 would be applicable as of the 
August 5, 1997, effective date of section 1503 of TRA '97.

5. Quick Reference Chart

    The chart below lists each section of 29 CFR parts 2520 and 2560 
that would be affected by this proposed rule and includes a brief 
description of the proposed change.

                                              Quick Reference Chart
----------------------------------------------------------------------------------------------------------------
            CFR section(s)                      Remove                    Add                   Reason(s)
----------------------------------------------------------------------------------------------------------------
2520.102-1...........................  The whole section......  ``Reserved''...........  All ``plan
                                                                                          description''
                                                                                          requirements
                                                                                          eliminated from ERISA.
2520.102-4...........................  The last sentence......  Nothing................  SPD filing requirement
                                                                                          eliminated.
2520.103-1(a)........................  ``section                ``section 104(a)(1)''..  Cross reference
                                        104(a)(1)(A)''.                                   correction.
2520.103-5(a), (c)(1)(i),              ``section                ``section 104(a)(1)''..  Cross reference
 (c)(1)(iii), (c)(2)(ii),               104(a)(1)(A)''.                                   correction.
 (c)(2)(iii), and (c)(3).
2520.103-12(a).......................  ``section                ``section 104(a)(1)''..  Cross reference
                                        104(a)(1)(A)''.                                   correction.
2520.104-4(a)........................  Last sentence..........  Nothing................  SPD filing requirement
                                                                                          eliminated.
2520.104-20(a) (introductory text)...  ``any of the following   Nothing................  All ``plan
                                        documents: Plan                                   description''
                                        description, copy of                              requirements
                                        summary plan                                      eliminated from ERISA,
                                        description,                                      SPD filing requirement
                                        description of                                    eliminated, and SMM
                                        material modification                             filing requirement
                                        in the terms of a plan                            eliminated.
                                        or change in the
                                        information required
                                        to be included in the
                                        plan description,''.
2520.104-20(a)(2)....................  ``plan description,''..  Nothing................  All ``plan
                                                                                          description''
                                                                                          requirements
                                                                                          eliminated from ERISA.
2520.104-20(a)(3)....................  ``plan description       Nothing................  All ``plan
                                        and''.                                            description''
                                                                                          requirements
                                                                                          eliminated from ERISA.
2520.104-20(c).......................  ``(section 104(a)(1))''  ``(section 104(a)(6))''  Requirement to furnish
                                                                                          documents to the
                                                                                          Department upon
                                                                                          request--moved to
                                                                                          different paragraph of
                                                                                          ERISA section 104.

[[Page 42794]]

 
2520.104-21(a) (introductory text)...  ``with the Secretary     After the word file,     All ``plan
                                        any of the following     add: ``with the          description''
                                        documents: Plan          Secretary a terminal     requirements
                                        description, copy of     report or furnish upon   eliminated from ERISA,
                                        summary plan             written request of any   SPD filing requirement
                                        description,             participant or           eliminated, and SMM
                                        description of           beneficiary a copy of    filing requirement
                                        material modification    any terminal report as   eliminated.
                                        in the terms of a plan   required by section
                                        or change in the         104(b)(4) of the
                                        information required     Act.''.
                                        to be included in the
                                        plan description, and
                                        terminal report. In
                                        addition, the
                                        administrator of a
                                        plan exempted under
                                        this section:''.
2520.104-21(a)(1)....................  All of (a)(1)..........  Nothing................  All ``plan
                                                                                          description''
                                                                                          requirements
                                                                                          eliminated from ERISA.
2520.104-21(a)(2)....................  All of (a)(2)..........  Nothing................  All ``plan
                                                                                          description''
                                                                                          requirements
                                                                                          eliminated from ERISA.
2520.104-21(c) (second parenthetical)  ``section                ``section 104(a)(1)''..  Cross reference
                                        104(a)(1)(A)''.                                   correction.
2520.104-21(c) (third parenthetical).  ``section 104(a)(1)''..  ``section 104(a)(6)''..  Requirement to furnish
                                                                                          documents to the
                                                                                          Department upon
                                                                                          request--moved to
                                                                                          different paragraph of
                                                                                          ERISA section 104.
2520.104-23(b)(2)....................  ``104(a)(1)''..........  ``104(a)(6)''..........  Requirement to furnish
                                                                                          documents to the
                                                                                          Department upon
                                                                                          request--moved to
                                                                                          different paragraph of
                                                                                          ERISA section 104.
2520.104-24(b).......................  ``104(a)(1)''..........  104(a)(6)''............  Requirement to furnish
                                                                                          documents to the
                                                                                          Department upon
                                                                                          request--moved to
                                                                                          different paragraph of
                                                                                          ERISA section 104.
2520.104-25..........................  ``104(a)(1)''..........  ``104(a)(6)''..........  Requirement to furnish
                                                                                          documents to the
                                                                                          Department upon
                                                                                          request--moved to
                                                                                          different paragraph of
                                                                                          ERISA section 104.
2520.104-26(a).......................  All of paragraph (a),    New paragraph (a),       Paragraph (a) needed to
                                        (a)(1), (a)(2), and      (a)(1), and (a)(2).      be restructured to
                                        (a)(3).                                           reflect the fact that
                                                                                          all ``plan
                                                                                          description''
                                                                                          requirements and the
                                                                                          SPD filing requirement
                                                                                          were eliminated from
                                                                                          ERISA.
2520.104-27(a).......................  All of paragraph (a),    New paragraph (a),       Paragraph (a) needed to
                                        (a)(1), (a)(2), and      (a)(1), and (a)(2).      be restructured to
                                        (a)(3).                                           reflect the fact that
                                                                                          all ``plan
                                                                                          description''
                                                                                          requirements and the
                                                                                          SPD filing requirement
                                                                                          were eliminated from
                                                                                          ERISA.
2520.104-41(b).......................  ``section                ``section 104(a)(1)''..  Cross reference
                                        104(a)(1)(A)''.                                   correction.
2520.104-43(a).......................  ``section                ``section 104(a)(1)''..  Cross reference
                                        104(a)(1)(A)''.                                   correction.
2520.104-44(d).......................  ``section                ``section 104(a)(1)''..  Cross reference
                                        104(a)(1)(A)''.                                   correction.
2520.104a-2..........................  Whole section..........  ``Reserved''...........  All ``plan
                                                                                          description''
                                                                                          requirements
                                                                                          eliminated from ERISA.
2520.104a-3..........................  Whole section..........  ``Reserved''...........  SPD filing requirement
                                                                                          eliminated.
2520.104a-4..........................  Whole section..........  ``Reserved''...........  SMM filing requirement
                                                                                          eliminated.
2520.104a-5(a).......................  ``section                ``section 104(a)(1)''..  Cross reference
                                        104(a)(1)(A)''.                                   correction.
2520.104a-5(a)(1)....................  All text in paragraph    ``Reserved''...........  Provision obsolete.
                                        (a)(1).
2520.104a-7..........................  Whole section..........  ``Reserved''...........  SMM filing requirement
                                                                                          eliminated.
2520.104b-1(b)(3)....................  ``plan description''...  Nothing................  All ``plan
                                                                                          description''
                                                                                          requirements
                                                                                          eliminated from ERISA.
2520.104b-3(f).......................  All of para. (f).......  Nothing................  Part of paragraph (f)
                                                                                          was superseded by TRA
                                                                                          '97 and the rest of
                                                                                          the paragraph has
                                                                                          become obsolete as a
                                                                                          result of the removal
                                                                                          of Sec.  2520.104a-3
                                                                                          by this rule.

[[Page 42795]]

 
2520.104b-3(g).......................  All of para. (g).......  Nothing................  Paragraph (g) was
                                                                                          superseded by TRA '97
                                                                                          and as a result of the
                                                                                          removal of Sec.
                                                                                          2520.104a-3 by this
                                                                                          rule.
2560.502c-2(a).......................  ``section 101(b)(4)''..  ``section 101(b)(1)''..  Cross reference
                                                                                          correction.
----------------------------------------------------------------------------------------------------------------

Executive Order 12866 Statement

    Under Executive Order 12866, the Department must determine whether 
the regulatory action is ``significant'' and therefore subject to the 
requirements of the Executive Order and subject to review by the Office 
of Management and Budget (OMB). Under section 3(f), the order defines a 
``significant regulatory action'' as an action that is likely to result 
in a rule: (1) Having an annual effect on the economy of $100 million 
or more, or adversely and materially affecting a sector of the economy, 
productivity, competition, jobs, the environment, public health or 
safety, or State, local or tribal governments or communities (also 
referred to as ``economically significant''); (2) creating serious 
inconsistency or otherwise interfering with an action taken or planned 
by another agency; (3) materially altering the budgetary impacts of 
entitlement grants, user fees, or loan programs or the rights and 
obligations of recipients thereof; or (4) raising novel legal or policy 
issues arising out of legal mandates, the President's priorities, or 
the principles set forth in the Executive Order. Pursuant to the terms 
of the Executive Order, it has been determined that this action is not 
significant within the meaning of the Executive Order.

Paperwork Reduction Act

    The rule being issued here is not subject to the requirements of 
the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) because it 
does not contain an ``information collection request'' as defined in 44 
U.S.C. 3502(3).

Regulatory Flexibility Act

    The Regulatory Flexibility Act, 5 U.S.C. 601 et seq., requires each 
Federal agency to perform an initial regulatory flexibility analysis 
for all proposed rules unless the head of the agency certifies that the 
rule will not, if promulgated, have a significant economic impact on a 
substantial number of small entities. Small entities include small 
businesses, organizations, and governmental jurisdictions. Because this 
proposed rule would remove certain provisions of the CFR and make a 
number of technical amendments to the CFR designed to correct cross-
references affected by amendments to ERISA enacted as part of TRA '97, 
the proposed rule would have no impact, independent of the statutory 
change eliminating the SPD and SMM filing requirements, on small plans. 
As a result, the undersigned certifies that this proposed rule, if 
promulgated, would not have a significant impact on a substantial 
number of small entities. The factual basis for this certification is 
the same regardless of whether one uses the definition of small entity 
found in regulations issued by the Small Business Administration (13 
CFR 121.201) or one defines small entity, on the basis of section 
104(a)(2) of ERISA, as an employee benefit plan with fewer than 100 
participants.

Small Business Regulatory Enforcement Fairness Act

    The proposed rule being issued here is subject to the provisions of 
the Small Business Regulatory Enforcement Fairness Act of 1996 (5 
U.S.C. 801 et seq.) and, if finalized, will be transmitted to Congress 
and the Comptroller General for review. The rule is not a ``major 
rule'' as that term is defined in 5 U.S.C. 804, because it is not 
likely to result in: (1) An annual effect on the economy of $100 
million or more; (2) a major increase in costs or prices for consumers, 
individual industries, or federal, State, or local government agencies, 
or geographic regions; or (3) significant adverse effects on 
competition, employment, investment, productivity, innovation, or on 
the ability of United States-based enterprises to compete with foreign-
based enterprises in domestic or export markets.

Unfunded Mandates Reform Act

    For purposes of the Unfunded Mandates Reform Act of 1995 (Pub. L. 
104-4), as well as Executive Order 12875, this proposed rule does not 
include any Federal mandate that may result in expenditures by State, 
local, or tribal governments, and will not impose an annual burden of 
$100 million or more on the private sector.

Statutory Authority

    This proposed rule is promulgated pursuant to the authority 
contained in section 505 of ERISA (Pub. L. 93-406, 88 Stat. 894, 29 
U.S.C. 1135) and sections 101(b) and 104(a)(1) of ERISA, as amended, 
and under the Secretary of Labor's Order No. 1-87, 52 FR 13139, April 
21, 1987.

List of Subjects

29 CFR Part 2520

    Employee benefit plans, Employee Retirement Income Security Act, 
Group health plans, Pension plans, Welfare benefit plans.

29 CFR Part 2560

    Claims, Employee benefit plans, Employee Retirement Income Security 
Act, Law enforcement, Pensions.

    For the reasons set forth above, parts 2520 and 2560 of Chapter XXV 
of Title 29 of the Code of Federal Regulations are amended as follows:

PART 2520--RULES AND REGULATIONS FOR REPORTING AND DISCLOSURE

    1. The authority citation for Part 2520 continues to read as 
follows:

    Authority: Secs. 101, 102, 103, 104, 105, 109, 110, 111 (b)(2), 
111(c), and 505, Pub. L. 93-406, 88 Stat. 840-52 and 894 (29 U.S.C. 
1021-1025, 1029-31, and 1135); Secretary of Labor's Order No. 27-74, 
13-76, 1-87, and Labor Management Services Administration Order 2-6.
    Sections 2520.102-3, 2520.104b-1 and 2520.104b-3 also are issued 
under sec. 101(a), (c) and (g)(4) of Pub. L. 104-191, 110 Stat. 
1936, 1939, 1951 and 1955 and, sec. 603 of Pub. L. 104-204, 110 
Stat. 2935 (29 U.S.C. 1185 and 1191(c)).

    2. Section 2520.102-1 is removed and reserved.
    3. Revise section 2520.102-4 to read as follows:


Sec. 2520.102-4  Option for different summary plan descriptions.

    In some cases an employee benefit plan may provide different 
benefits for various classes of participants and beneficiaries. For 
example, a plan amendment altering benefits may apply to only those 
participants who are employees of an employer when the

[[Page 42796]]

amendment is adopted and to employees who later become participants, 
but not to participants who no longer are employees when the amendment 
is adopted. (See Sec. 2520.104b-4). Similarly, a plan may provide for 
different benefits for participants employed at different plants of the 
employer, or for different classes of participants in the same plant. 
In such cases the plan administrator may fulfill the requirement to 
furnish a summary plan description to participants covered under the 
plan and beneficiaries receiving benefits under the plan by furnishing 
to each member of each class of participants and beneficiaries a copy 
of a summary plan description appropriate to that class. Each summary 
plan description so prepared shall follow the style and format 
prescribed in Sec. 2520.102-2, and shall contain all information which 
is required to be contained in the summary plan description under 
Sec. 2520.102-3. It may omit information which is not applicable to the 
class of participants or beneficiaries to which it is furnished. It 
should also clearly identify on the first page of the text the class of 
participants and beneficiaries for which it has been prepared and the 
plan's coverage of other classes. If the classes which the employee 
benefit plan covers are too numerous to be listed adequately on the 
first page of the text of the summary plan description, they may be 
listed elsewhere in the text so long as the first page of the text 
contains a reference to the page or pages in the text which contain 
this information.
    4. Section 2520.103-1(a), introductory text, is amended by removing 
the term ``section 104(a)(1)(A)'' and adding, in its place, the term 
``section 104(a)(1)''.
    5. Section 2520.103-5 is amended by removing the term ``section 
104(a)(1)(A)'' from paragraphs (a), introductory text, (c)(1)(i), 
(c)(1)(iii), (c)(2)(ii), (c)(2)(iii) and (c)(3) and adding, in their 
place, the term ``section 104(a)(1)''.
    6. Section 2520.103-12 is amended by removing from paragraph (a) 
the term ``section 104(a)(1)(A)'' and adding, in its place, the term 
``section 104(a)(1)''.
    7. Revise paragraph (a) of Sec. 2520.104-4 to read as follows:


Sec. 2520.104-4  Alternative method of compliance for certain successor 
pension plans.

    (a) General. Under the authority of section 110 of the Act, this 
section sets forth an alternative method of compliance for certain 
successor pension plans in which some participants and beneficiaries 
not only have their rights set out in the plan, but also retain 
eligibility for certain benefits under the terms of a former plan which 
has been merged into the successor. This section is applicable only to 
plan mergers which occur after the issuance by the successor plan of 
the initial summary plan description under the Act. Under the 
alternative method, the plan administrator of the successor plan is not 
required to describe relevant provisions of merged plans in summary 
plan descriptions of the successor plan furnished after the merger to 
that class of participants and beneficiaries still affected by the 
terms of the merged plans.
* * * * *
    8. Revise the introductory text in paragraph (a) and paragraphs 
(a)(2), (a)(3), and (c) of Sec. 2520.104-20 to read as follows:


Sec. 2520.104-20  Limited exemption for certain small welfare plans.

    (a) Scope. Under the authority of section 104(a)(3) of the Act, the 
administrator of any employee welfare benefit plan which covers fewer 
than 100 participants at the beginning of the plan year and which meets 
the requirements of paragraph (b) of this section is exempted from 
certain reporting and disclosure provisions of the Act. Specifically, 
the administrator of such plan is not required to file with the 
Secretary an annual or terminal report. In addition, the administrator 
of a plan exempted under this section--
* * * * *
    (2) Is not required to furnish upon written request of any 
participant or beneficiary a copy of the annual report and any terminal 
report, as required by section 104(b)(4) of the Act;
    (3) Is not required to make copies of the annual report available 
for examination by any participant or beneficiary in the principal 
office of the administrator and such other places as may be necessary, 
as required by section 104(b)(2) of the Act.
    (b) * * *
    (c) Limitations. This exemption does not exempt the administrator 
of an employee benefit plan from any other requirement of Title I of 
the Act, including the provisions which require that plan 
administrators furnish copies of the summary plan description to 
participants and beneficiaries (section 104(b)(1)) and furnish certain 
documents to the Secretary of Labor upon request (section 104(a)(6)), 
and which authorize the Secretary of Labor to collect information and 
data from employee benefit plans for research and analysis (section 
513).
* * * * *
    9. Amend Sec. 2520.104-21 by revising paragraphs (a) and (c) to 
read as follows:


Sec. 2520.104-21  Limited exemption for certain group insurance 
arrangements.

    (a) Scope. Under the authority of section 104(a)(3) of the Act, the 
administrator of any employee welfare benefit plan which covers fewer 
than 100 participants at the beginning of the plan year and which meets 
the requirements of paragraph (b) of this section is exempted from 
certain reporting and disclosure provisions of the Act. Specifically, 
the administrator of such plan is not required to file with the 
Secretary a terminal report or furnish upon written request of any 
participant or beneficiary a copy of any terminal report as required by 
section 104(b)(4) of the Act.
* * * * *
    (c) Limitations. This exemption does not exempt the administrator 
of an employee benefit plan from any other requirement of title I of 
the Act, including the provisions which require that plan 
administrators furnish copies of the summary plan description to 
participants and beneficiaries (section 104(b)(1)), file an annual 
report with the Secretary of Labor (section 104(a)(1)) and furnish 
certain documents to the Secretary of Labor upon request (section 
104(a)(6)), and authorize the Secretary of Labor to collect information 
and data from employee benefit plans for research and analysis (section 
513).
* * * * *
    10. Section 2520.104-23 is amended by removing from paragraph 
(b)(2) the term ``104(a)(1)'' and adding, in its place, the term 
``104(a)(6)''.
    11. Section 2520.104-24 is amended by removing from paragraph (b) 
the term ``104(a)(1)'' and adding, in its place, the term 
``104(a)(6)''.
    12. Section 2520.104-25 is amended by removing the term 
``104(a)(1)'' and adding, in its place, the term ``104(a)(6)''.
    13. In Sec. 2520.104-26, revise paragraph (a) to read as follows:


Sec. 2520.104-26  Limited exemption for certain unfunded dues financed 
welfare plans maintained by employee organizations.

    (a) Scope. Under the authority of section 104(a)(3) of the Act, a 
welfare benefit plan that meets the requirements of paragraph (b) of 
this section is exempted from the provisions of the Act that require 
filing with the Secretary an annual report and furnishing a summary 
annual report to participants and beneficiaries. Such plans may use a 
simplified method of reporting and disclosure to comply with the

[[Page 42797]]

requirement to furnish a summary plan description to participants and 
beneficiaries, as follows:
    (1) In lieu of filing an annual report with the Secretary or 
distributing a summary annual report, a filing is made of Report Form 
LM-2 or LM-3, pursuant to the LMRDA and regulations thereunder, and
    (2) In lieu of a summary plan description, the employee 
organization constitution or by-laws may be furnished in accordance 
with Sec. 2520.104b-2 to participants and beneficiaries together with 
any supplement to such document necessary to meet the requirements of 
Secs. 2520.102-2 and 2520.102-3.
* * * * *
    14. In Sec. 2520.104-27, revise paragraph (a) to read as follows:


Sec. 2520.104-27  Alternative method of compliance for certain unfunded 
dues financed pension plans maintained by employee organizations.

    (a) Scope. Under the authority of section 110 of the Act, a pension 
benefit plan that meets the requirements of paragraph (b) of this 
section is exempted from the provisions of the Act that require filing 
with the Secretary an annual report and furnishing a summary annual 
report to participants and beneficiaries. Such plans may use a 
simplified method of reporting and disclosure to comply with the 
requirement to furnish a summary plan description to participants and 
beneficiaries, as follows:
    (1) In lieu of filing an annual report with the Secretary or 
distributing a summary annual report, a filing is made of Report Form 
LM-2 or LM-3, pursuant to the LMRDA and regulations thereunder, and
    (2) In lieu of a summary plan description, the employee 
organization constitution or by-laws may be furnished in accordance 
with Sec. 2520.104b-2 to participants and beneficiaries together with 
any supplement to such document necessary to meet the requirements of 
Secs. 2520.102-2 and 2520.102-3.
* * * * *
    15. Section 2520.104-41 is amended by removing from paragraph (b) 
the term ``section 104(a)(1)(A)'' and adding, in its place, the term 
``section 104(a)(1)''.
    16. Section 2520.104-43 is amended by removing from paragraph (a) 
the term ``section 104(a)(1)(A)'' and adding, in its place, ``section 
104(a)(1)''.
    17. Section 2520.104-44 is amended by removing from paragraph (d) 
the term ``section 104(a)(1)(A)'' and adding, in its place, ``section 
104(a)(1)''.
    18. Section 2520.104a-2 is removed and reserved.
    19. Section 2520.104a-3 is removed and reserved.
    20. Section 2520.104a-4 is removed and reserved.
    21. Section 2520.104a-5 is amended by removing the term ``section 
104(a)(1)(A)'' and adding, in its place, the term ``section 
104(a)(1)''.
    22. Section 2520.104a-5 is amended by removing and reserving 
paragraph (a)(1).
    23. Section 2520.104a-7 is removed and reserved.
    24. Section 2520.104b-1 is amended by removing from the second 
sentence of paragraph (b)(3) the term ``plan description,''.
    25. In Sec. 2520.104b-3 paragraphs (f) and (g) are removed and 
reserved.

PART 2560--RULES AND REGULATIONS FOR ADMINISTRATION AND ENFORCEMENT

    26. The authority citation for part 2560 continues to read as 
follows:

    Authority: Secs. 502, 505 of ERISA, 29 U.S.C. 1132, 1135, and 
Secretary's Order   1-87, 52 FR 13139 (April 21, 1987).

    Section 2560.502-1 also issued under sec. 502(b)(2), 29 U.S.C. 
1132(b)(2).
    Section 2560.502i-1 also issued under sec. 502(i), 29 U.S.C. 
1132(i).
    Section 2560.503-1 also issued under sec. 503, 29 U.S.C. 1133.


Sec. 2560.502c-21  [Amended]

    27. Section 2560.502c-2 is amended by removing from paragraph 
(a)(1) and (a)(2) the term ``section 101(b)(4)'' each time it appears 
and adding, in its place, the term ``section 101(b)(1)''.

    Signed at Washington, D.C., this 28th day of July 1999.
Richard M. McGahey,
Assistant Secretary, Pension and Welfare Benefits Administration, 
Department of Labor.
[FR Doc. 99-19860 Filed 8-4-99; 8:45 am]
BILLING CODE 4510-29-P