[Federal Register Volume 90, Number 34 (Friday, February 21, 2025)]
[Notices]
[Pages 10087-10091]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-02930]
[[Page 10087]]
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DEPARTMENT OF LABOR
Employee Benefits Security Administration
[Application Numbers D-12113 and D-12112]
Proposed Amendment To Extend the Effective Dates for Prohibited
Transaction Exemption (PTE) 2016-10 Involving Royal Bank of Canada
(Together With Its Current and Future Affiliates, RBC) Located in
Toronto, Canada, and PTE 2016-11 Involving Northern Trust Corporation
(Together With Its Current and Future Affiliates, Northern) Located in
Chicago, Illinois
AGENCY: Employee Benefits Security Administration, Labor.
ACTION: Notice of proposed amendments.
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SUMMARY: The Department of Labor (the Department) is proposing to
extend the effective periods of PTEs 2016-10 (granted to RBC) and 2016-
11 (granted to Northern), which currently are scheduled to expire on
March 4, 2025, for up to six months if RBC and Northern meet certain
conditions. The proposed amendment to PTE 2016-10 is referred to herein
as the RBC Proposed QPAM Amendment, and the proposed amendment to PTE
2016-11 is referred to herein as the Northern Proposed QPAM Amendment.
DATES: Written comments and requests for a public hearing on either
proposed amendment must be received by the Department on or before
February 26, 2025.
ADDRESSES: Please send all written comments and requests for hearing
regarding the RBC and Northern Proposed QPAM Amendments to the Employee
Benefits Security Administration (EBSA), Office of Exemption
Determinations, via email to [email protected] or online through https://www.regulations.gov, Attention: Application No. D-12113 for RBC, and
Attention: Application No. D-12112 for Northern. The comments received
will be made available by the Department for public inspection in the
Public Disclosure Room of the Employee Benefits Security
Administration, U.S. Department of Labor, Room N-1515, 200 Constitution
Avenue NW, Washington, DC 20210, reachable by telephone at (202) 693-
8673. Comments and hearing requests will also be available online at
https://www.regulations.gov at no charge. See SUPPLEMENTARY INFORMATION
below for additional information regarding comments.
FOR FURTHER INFORMATION CONTACT: For the RBC Proposed QPAM Amendment,
please contact Ms. Blessed Chuksorji-Keefe, Office of Exemption
Determinations, Employee Benefits Security Administration, U.S.
Department of Labor, (202) 693-8567 (this is not a toll-free number).
For the Northern Proposed QPAM Amendment, please contact Ms. Anna Mpras
Vaughan, Office of Exemption Determinations, Employee Benefits Security
Administration, U.S. Department of Labor, (202) 693-8565 (this is not a
toll-free number).
SUPPLEMENTARY INFORMATION:
Comments: Persons are encouraged to submit all comments
electronically, without submitting paper versions. Comments should
state the nature of the person's interest in either or both proposed
amendment(s) and how the person would be adversely affected by the
proposed amendment(s). Any person who may be adversely affected by an
amendment can request a hearing on the amendment. A request for a
hearing must state: (1) the name, address, telephone number, and email
address of the person making the request; (2) the nature of the
person's interest in the amendment and the manner in which the person
would be adversely affected by the amendment; and (3) a statement of
the issues to be addressed and a general description of the evidence to
be presented at the hearing. The Department will grant a request for a
hearing made in accordance with the requirements above where a hearing
is necessary to fully explore material factual issues identified by the
person requesting the hearing. The Department would publish a notice
announcing such hearing in the Federal Register. The Department may
decline to hold a hearing if: (1) the request for the hearing does not
meet the requirements above; (2) the only issues identified for
exploration at the hearing are matters of law; or (3) the factual
issues identified can be fully explored through the submission of
evidence in written (including electronic) form.
Warning: All comments received will be included in the public
record without change and may be made available online at https://www.regulations.gov, including any personal information provided,
unless the comment includes information claimed to be confidential or
other information whose disclosure is restricted by statute. If you
submit a comment, EBSA recommends that you include your name and other
contact information in the body of your comment, but DO NOT submit
information that you consider to be confidential, or otherwise
protected (such as a Social Security number or an unlisted phone
number) or confidential business information that you do not want
publicly disclosed. However, if EBSA cannot read your comment due to
technical difficulties and cannot contact you for clarification, EBSA
might not be able to consider your comment.
Additionally, please note that the https://www.regulations.gov
website is an ``anonymous access'' system; therefore, EBSA will not
know your identity or contact information unless you provide it in the
body of your comment. If you send an email directly to EBSA without
going through https://www.regulations.gov, your email address will be
automatically captured and included as part of the comment that is
placed in the public record and made available on the internet.
Proposed Amendment
The Department is considering granting the amendment pursuant to
its authority under ERISA section 408(a), and in accordance with the
Department's exemption procedures.\1\ If the Department grants a final
exemption, the effective periods of PTE 2016-10 and PTE 2016-11 will be
extended until the earlier of September 4, 2025, or the date that the
Department makes a final agency action in connection with the recently
published Notices of Proposed Exemption for the RBC QPAMs and the
Northern QPAMs.\2\ RBC and Northern must continue to meet the
conditions for relief under PTE 2016-10 and PTE 2016-11 during their
effective periods.
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\1\ 29 CFR part 2570, subpart B (89 FR 4662, 4691, January 24,
2024). Effective December 31, 1978, section 102 of Reorganization
Plan No. 4 of 1978, 5 U.S.C. app. 1 (1996), transferred the
authority of the Secretary of the Treasury to issue exemptions of
the type requested by the Applicant to the Secretary of Labor.
\2\ Proposed Exemption for the Royal Bank of Canada and Its
Current and Future Affiliates at 90 FR 6013, January 17, 2025;
Proposed Exemption From Certain Prohibited Transaction Restrictions
Involving Northern Trust Corporation at 90 FR 7174, January 21,
2025.
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A. Background
On October 28, 2016, the Department published PTEs 2016-10 and
2016-11 in the Federal Register.\3\ PTE 2016-10 is a temporary
administrative exemption that permits certain entities (the RBC
Qualified Professional Asset Managers (QPAMs)) with specified
relationships to Royal Bank of Canada (Bahamas) Limited (RBCTC Bahamas)
to continue to rely upon the relief provided by the
[[Page 10088]]
Department's QPAM Exemption \4\ for a one-year period beginning on
March 4, 2024, and ending on March 5, 2025, notwithstanding a potential
judgment of conviction against RBCTC Bahamas for aiding and abetting
tax fraud.\5\ Similarly, PTE 2016-11 permits certain entities (the
Northern QPAMs) with specified relationships to Northern Trust
Fiduciary Services (Guernsey) ltd. (NTFS) to continue to rely upon the
relief provided by the Department's QPAM Exemption for a one-year
period beginning on March 4, 2024, and ending on March 5, 2025,
notwithstanding a potential judgment of conviction against NTFS for
aiding and abetting tax fraud in the same scheme.\6\
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\3\ 81 FR 75147 and 81 FR 75150 (October 28, 2016).
\4\ PTE 84-14 49 FR 9494, March 13, 1984, as corrected at 50 FR
41430 (October 10, 1985), as amended at 70 FR 49305 (August 23,
2005), as amended at 75 FR 38837 (July 6, 2010), and as amended at
89 FR 23090 (April 3, 2024), hereinafter referred to as PTE 84-14 or
the QPAM exemption.
\5\ Section I(g) of PTE 84-14 prevents an entity that may
otherwise meet the definition of a QPAM from utilizing the exemptive
relief provided by PTE 84-14 for itself and its client plans, if
that entity or an ``affiliate'' thereof, or any owner, direct or
indirect, of a five percent or more interest in the QPAM has within
10 years immediately preceding the transaction, been either
convicted or released from imprisonment, whichever is later, as a
result of criminal activity described in that section. On December
11, 2023, the Department issued a technical correction to PTE 2016-
10 when RBCTC Bahamas was convicted of aiding and abetting tax fraud
in France to accurately identify the French Court issuing the
conviction.
\6\ On April 4, 2024, the Department issued a technical
correction to PTE 2016-11 (89 FR 23612) after NTFS was convicted of
aiding and abetting tax fraud in France to accurately identify the
French Court issuing the conviction.
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The Department granted PTEs 2016-10 and 2016-11 to protect RBC and
Northern's ERISA-covered plan and IRA clients from the harm that could
result from their respective QPAMs' loss of relief under PTE 84-14 due
to the QPAMs' convictions.
RBC and Northern separately applied to the Department for extended
relief that would apply after the relief in PTEs 2016-10 and 2016-11
expires. In response, on January 17, 2025, the Department published a
proposed exemption that would extend the relief in PTE 2016-10 for five
years (the RBC Five-Year Proposed QPAM Exemption) from March 5, 2025,
to March 4, 2030, if the RBC QPAMs would meet the proposed exemption's
conditions. The proposed exemption has a 45-day notice and comment
period that expires on March 3, 2025.
On January 21, 2025, the Department published a similar proposed
exemption that would extend the relief in PTE 2016-11 for five years--
from March 5, 2025, to March 4, 2030 (the Northern Five-Year Proposed
QPAM Exemption) if the Northern QPAMs meet the terms of the exemption.
The proposed exemption has a 45-day notice and comment period that
expires on March 7, 2025.
B. Northern's Concerns With the Northern Five-Year Proposed QPAM
Exemption
Following publication of the Northern Five-Year Proposed QPAM
Exemption in the Federal Register, Northern expressed concern to the
Department that due to the timing of the proposed exemption's
publication, the 45-day notice and comment period does not end until
March 7, 2025; therefore, the proposed exemption cannot be granted
before Northern's current relief in PTE 2016-11 expires on March 4,
2025. Even if the Northern QPAMs eventually received relief retroactive
to March 5, 2025, the timing would result in a ``gap period'' during
which Northern QPAMs would not qualify for the QPAM Exemption from
March 5, 2025, until the date the Department publishes a final
exemption. Northern's legal counsel represents that the resultant gap
period in the exemption's relief would be harmful to affected plans and
their participants and beneficiaries. The Northern QPAMs make
representations in their Internal Swaps and Derivative Association
(ISDA) agreements with various counterparties stating that to the
extent the QPAM is using ``plan assets'' (within the meaning of ERISA
Section 3(42)) in connection with a transaction entered into under the
ISDA, it is a ``qualified professional asset manager,'' and PTE 84-14
will apply to any applicable transactions entered thereunder. The
failure to satisfy this representation can result in a default-based
early termination of the ISDA agreements and a lump sum payment would
be due to the applicable counterparty.
In addition, certain fixed income securities have ``deemed'' ERISA-
related representations. This means that the purchaser of the security
is deemed to have represented that the purchase, holding, and eventual
sale/transfer of the security is not and will not be a non-exempt
prohibited transaction under ERISA. In some cases, the applicable fixed
income security will specify the PTEs that can be relied upon in
connection with the purchase, holding, and sale/transfer of the
security. In these instances, only the status-based exemptions are
generally permitted (i.e., PTEs 84-14, 90-1, 91-38, 95-60, and 96-23).
Failure to satisfy these ``deemed representations'' would void the
transaction, according to Northern.
Further, in these situations, Northern could not provide the
Department with certainty that counterparties would not exercise their
rights to default and/or void applicable transactions. Of specific
concern to Northern is if there were a market disruption that made it
beneficial for the Northern QPAMs' counterparties to default or void a
transaction, they may not hesitate to do so, which would cause harms to
their covered plan clients. Northern urged the Department to work with
it to eliminate such risks to affected plans and their participants and
beneficiaries.
For a more complete description of Northern, the Northern QPAMs,
and transactions engaged in by the Northern QPAMs, please see the
Northern Five-Year Proposed QPAM Exemption published in the Federal
Register on January 21, 2025 (90 FR 7174).
C. RBC Concerns With the RBC Five-Year Proposed Exemption
Following publication of the RBC Five-Year Proposed QPAM Exemption,
RBC's counsel also expressed concern to the Department that the
proposed exemption would not be granted before its current relief
expires on March 4, 2025. As is the case with the Northern QPAMs
(described above), even if the RBC QPAMs eventually received relief
retroactive to March 5, 2025, the timing would result in a ``gap
period'' during which the RBC QPAMs would not qualify for the QPAM
Exemption from March 5, 2025, until the date the Department publishes a
final exemption. RBC argues that the gap in exemptive relief would be
harmful to affected plans and their participants and beneficiaries.
Specifically, RBC represents that affected plans would be harmed if RBC
does not obtain exemptive relief ahead of the expiration of PTE 2016-10
on March 4, 2025, with an effective date of March 5, 2025.
To substantiate such harmful effects, RBC makes the following
representations. Many investments needing continuing relief, such as
many derivatives, loans, leases, and other extensions of credit,
contain deemed or explicit representations that the QPAM Exemption is
applicable, with a corresponding contractual obligation to notify the
lender, lessor or counterparty if the representation becomes untrue.
Under master agreements, moreover, those representations are deemed to
be made at each time a transaction is entered into, meaning RBC QPAMs
could be prohibited from entering into transactions on behalf of
underlying plans for as long as the representation remains untrue (for
example, for the period during which exemptive relief is not provided).
A breach of a representation or warranty can also
[[Page 10089]]
trigger an event of default for those trading agreements, which could
leave the ERISA plan responsible for liquidation and other transition
costs. Upon the expiration of PTE 2016-10, that obligation is triggered
unless further relief is in place.
As a prudent fiduciary, the investment manager would be obligated
to identify every instrument and communicate with every counterparty.
While some counterparties might negotiate additional, potentially
onerous terms to avoid termination, others would invoke their rights on
default.\7\ Thus, many plans could be in default on their continuing
representation to clients and counterparties that they meet the
conditions of the QPAM Exemption, and counterparties would be able to
immediately terminate existing, continuing transactions with the RBC
QPAMs' affected plan clients.
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\7\ RBC notes that counterparties are not acting as a fiduciary
to plans and, thus, could terminate positions based on the
counterparty's own interests in the event of a default.
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Further, in RBC's discussions with market counterparties regarding
this issue, the counterparties uniformly stated that RBC's hope or even
reasonable expectation that the RBC QPAMs would eventually obtain
retroactive relief would not be sufficient to avoid default. RBC argues
that potential retroactive relief would not be a substitute for
obtaining timely exemptive relief with no gap period, and the risk and
compliance functions of their institutions might well terminate an
existing transaction in the absence of a guarantee that RBC QPAMs could
rely on the QPAM Exemption on March 5, 2025 (without a gap period).
Moreover, RBC represents that if there is a gap period in exemptive
relief, as other instruments mature, new trades dependent on the QPAM
Exemption could not be entered into, leaving plans without the benefit
of all of the instruments and trading strategies contemplated by their
investment guidelines. Because the QPAM Exemption is often used for
hedging trades, affected plans could be left with fewer and less
effective ways to hedge risk. Plans would not have the trading
efficiencies and breadth of investment choices and potential
counterparties afforded by the QPAM Exemption for the entire period
from the expiration of PTE 2016-10 until final relief was granted,
notwithstanding any retroactive relief following a gap period.
These plans would lose the ability to retain current positions,
which might be impossible to replicate another way with similar
economics. In an extremely volatile period, the termination of existing
transactions and the inability to enter into new transactions would be
severely disadvantageous to plans. Such a curtailed selection of
available transactions would negatively impact these client plans,
depriving them of the benefits the QPAM Exemption was designed to offer
and effectively penalizing them for having retained the RBC QPAMs.
Finally, a gap period in exemptive relief will introduce a great
deal of uncertainty for RBC's affected plan clients in terms of RBC's
ability to fulfill the obligations to such clients as their investment
adviser. Because many of RBC's investment management agreements require
that it continue to meet the requirements of the QPAM Exemption during
the term of such agreements, in the event of a gap period in exemptive
relief, the RBC QPAMs would be compelled to give immediate notice to
their clients that RBC no longer meets the requirements of the QPAM
Exemption upon expiration of PTE 2016-10. Plan clients will need to
consult on an emergency basis with their lawyers and consultants; they
may decide to incur the cost of a manager search, even though they had
no intention of switching managers.
Any news reports on changes in policy due to the change in
Administration could complicate their thinking and trigger precipitous
decision making. Market participants could use the uncertainty to
undercut trading strategies, and other investment managers could seek
to attract and hire RBC portfolio managers who were concerned about the
likelihood of relief. This is true even for clients that are not
subject to ERISA (and therefore do not depend on RBC's QPAM status)
because of the stigma that a QPAM disqualification would create.
Pension plans, including non-ERISA plans such as public plans, union
plans, corporate plans and others, tend to treat QPAM status as a
threshold prerequisite for entrusting plan assets with an investment
manager and could be concerned that retaining a non-QPAM asset manager
would be viewed by their participants and regulators as a breach of
fiduciary duties.
Prior submissions in connection with RBC's application for the RBC
Five-Year Proposed QPAM Exemption have estimated the substantial
transaction and ancillary costs to which plans would be subjected in
the event they liquidated their holdings with RBC and transferred their
assets to new managers. These costs would be attributable only to the
gap in exemptive relief.
For a more complete discussion of RBC, the RBC QPAMs, and the
transactions engaged in by the RBC QPAMs, please see the RBC Five-Year
Proposed QPAM Exemption published on January 17, 2025 (90 FR 6013).
D. Department's Response to RBC and Northern Representations
Based on the foregoing, the Department is hereby proposing to
extend the effective periods of PTEs 2016-10 and 2016-11 until the
earlier of September 4, 2025 (six months after the current relief in
PTEs 2016-10 and 2016-11 expires on March 4, 2025), or the date the
Department issues its final agency action in connection with the RBC
and Northern Five-Year Proposed QPAM Exemptions, in order to protect
the RBC and Northern QPAMs' covered plan clients from the harmful
consequences described above.
The relief in each of these proposed amendments would be contingent
on RBC and Northern's satisfaction of the conditions in PTEs 2016-10
and 2016-11 at all times. Further, the proposed amendments would add a
requirement to PTEs 2016-10 and 2016-11 that would require the RBC and
Northern QPAMs to: (1) maintain the records necessary to demonstrate to
the Department that they have met every condition of their exemptions
during the extended Effective Period; and (2) provide such records to
the Department within 30 days after the date of the Department's
request.
E. The Department's Statutory Findings
In accordance with ERISA section 408(a), Code section 4975(c)(2),
and the Department's exemption procedures and based upon the entire
administrative record for this matter, the Department tentatively makes
the following findings for each proposed amendment:
(a) The proposed amendment is administratively feasible for the
Department, because each amendment would require affected QPAMs to
maintain the records necessary to demonstrate to the Department that
all relevant conditions have been met with respect to the effective
period of this amendment and provide such records within 30 days after
the Department's request;
(b) The proposed amendment is in the interest of affected plans and
their participants and beneficiaries because it would likely eliminate
the harms to those plans that are described above if a gap period
occurred and the amendment was not made, and because of the benefits of
permitting plans to continue to rely upon the affected QPAMs' services
under the terms of
[[Page 10090]]
each proposed amendment (and underlying individual exemption); and
(c) The proposed amendment is protective of the rights of the
participants and beneficiaries of affected plans because each amendment
would be subject to a suite of protective conditions that the
Department has determined provide ample protections for the rights of
plans that are managed by QPAMs and their participants and
beneficiaries, and the Department has included in individual exemptions
for QPAMs that have experienced a ineligibility event similar to the
one experienced by the RBC and Northern QPAMs.
Notice to Interested Persons
Notice of the proposed amendments to the exemptions is provided
through publication of the notice in the Federal Register. All written
comments and/or requests for a hearing must be received by the
Department within five (5) days of the date of publication of this
proposed exemption in the Federal Register and will be made available
to the public.
Warning: If you submit a comment, please include your name and
other contact information in the body of your comment but DO NOT submit
information that you consider to be confidential or otherwise protected
(such as a Social Security number or an unlisted phone number) or
confidential business information that you do not want publicly
disclosed. All comments may be posted on the internet and can be
retrieved by most internet search engines.
General Information
The attention of interested persons is directed to the following:
(1) The fact that a transaction is the subject of an exemption
under ERISA section 408(a) and/or Code section 4975(c)(2) does not
relieve a fiduciary or other party in interest or disqualified person
from certain other provisions of ERISA and/or the Code, including any
prohibited transaction provisions to which the exemption does not apply
and the general fiduciary responsibility provisions of ERISA section
404, which, among other things, require a fiduciary to discharge their
duties respecting the plan solely in the interest of the participants
and beneficiaries of the plan and in a prudent fashion in accordance
with ERISA section 404(a)(1)(b); nor does it affect the requirement of
Code section 401(a) that the plan must operate for the exclusive
benefit of the employees of the employer maintaining the plan and their
beneficiaries;
(2) Before an exemption may be granted under ERISA section 408(a)
and/or Code section 4975(c)(2), the Department must find that the
exemption is administratively feasible, in the interests of the plan
and of its participants and beneficiaries, and protective of the rights
of participants and beneficiaries of the plan;
(3) The proposed exemption would be supplemental to, and not in
derogation of, any other provisions of ERISA and/or the Code, including
statutory or administrative exemptions and transitional rules.
Furthermore, the fact that a transaction is subject to an
administrative or statutory exemption is not dispositive of whether the
transaction is in fact a prohibited transaction; and
(4) The proposed exemption would be subject to the express
condition that the material facts and representations contained in each
application are true and complete at all times, and that each
application accurately describes all material terms of the transaction
which is the subject of the exemption.
The Department is considering granting the following amendments to
the exemptions under the authority of ERISA section 408(a) and Code
section 4975(c)(2) in accordance with the procedures set forth in 29
CFR part 2570, subpart B (89 FR 4662, 4691, January 24, 2024).
Effective December 31, 1978, section 102 of Reorganization Plan No. 4
of 1978, 5 U.S.C. app. 1 (1996), transferred the authority of the
Secretary of the Treasury to issue exemptions of the type requested by
the Applicant to the Secretary of Labor. Therefore, this notice of
proposed exemption is issued solely by the Department.
Proposed Amendments to PTE 2016-10
The Department is hereby proposing to amend PTE 2016-10 as follows:
1. The first sentence in Section I on page 81 FR 75147 that
currently reads:
Certain entities with specified relationships to Royal Bank of
Canada Trust Company (Bahamas) Limited (RBCTC Bahamas) (hereinafter,
the RBC QPAMs, as further defined in Section II(b)) will not be
precluded from relying on the exemptive relief provided by
Prohibited Transaction Exemption (PTE) 84-14 [footnote
omitted],notwithstanding a judgment of conviction against RBCTC
Bahamas for aiding and abetting tax fraud, to be entered in France
in the District Court of Paris (the Conviction, as further defined
in Section II(a)) [footnote omitted], for a period of up to twelve
months beginning on the date of the Conviction (the Conviction
Date), provided the following conditions are satisfied:
would be replaced with the following sentence:
Certain entities with specified relationships to Royal Bank of
Canada Trust Company (Bahamas) Limited (RBCTC Bahamas) (hereinafter,
the RBC QPAMs, as further defined in Section II(b)) will not be
precluded from relying on the exemptive relief provided by
Prohibited Transaction Exemption (PTE 84-14), notwithstanding a
judgment of conviction against RBCTC Bahamas for aiding and abetting
tax fraud entered in France in the Court of Appeal, French Special
Prosecutor No. 1120392066, French Investigative Judge No. JIRSIF/11/
12 or another court of competent jurisdiction (the Conviction, as
further defined in Section II(a)), for a period of up to 18 months
beginning on the date of the Conviction (the Conviction Date),
provided the following conditions are satisfied:
2. The Exemption Date section on page 88 FR 85931 of the Technical
Correction to PTE 2016-10, and the Effective Date section on page 81 FR
75149 of PTE 2016-10 are replaced with the following:
PTE 2016-10 will remain in effect for the period beginning on the
Conviction Date and continuing until the earlier of: (1) September 4,
2025 (the date that is 18 months after the Conviction Date); or (2) the
effective date of a final agency action the Department issues in
connection with a notice of proposed exemption providing long-term
exemptive relief for the covered transactions described in PTE 2016-10
that the Department published on January 17, 2025 (90 FR 6013) (the
Extended Effective Period).
3. A new condition I(n) would be added that reads as follows:
The RBC QPAMs must maintain the records necessary to demonstrate to
the Department that each condition of PTE 2016-10 has been met during
the Extended Effective Period, and the RBC QPAMs must provide such
records to the Department within 30 days after the date of a request
for such records from the Department.
Proposed Amendments to PTE 2016-11
The Department is proposing to amend to PTE 2016-11 as follows:
1. The First Sentence in Section I on pages 81 FR 75150-51 that
currently reads:
Certain entities with specified relationships to Northern Trust
Fiduciary Services (Guernsey) ltd. (NTFS) (hereinafter, the Northern
QPAMs, as further defined in Section II(b)) will not be precluded
from relying on the exemptive relief provided by Prohibited
Transaction Exemption 84-14 (PTE) 84-14 [footnote omitted],
notwithstanding a judgment of conviction against NTFS for aiding and
abetting tax fraud, to be entered in France in the District Court of
Paris (the Conviction, as further defined in Section II(a))
[footnote omitted], for a period of up to twelve months
[[Page 10091]]
beginning on the date of the Conviction (the Conviction Date),
provided the following conditions are satisfied:
would be replaced with the following sentence:
Certain entities with specified relationships to Northern Trust
Fiduciary Services (Guernsey) ltd. (NTFS) (hereinafter, the Northern
QPAMs, as further defined in Section II(b)) will not be precluded
from relying on the exemptive relief provided by Prohibited
Transaction Exemption 84-14 (PTE 84-14), notwithstanding a judgment
of conviction against NTFS for aiding and abetting tax fraud,
entered in France in the Court of Appeal, French Special Prosecutor
No. 1120392066, French Investigative Judge No. JIRSIF/11/12 or
another court of competent jurisdiction (the Conviction, as further
defined in Section II(a)), for a period of up to 18 months beginning
on the date of the Conviction (the Conviction Date), provided the
following conditions are satisfied:
2. The Exemption Date section on page 89 FR 23613 of the Technical
Correction to PTE 2016-11; and the Effective Date section on page 81 FR
75152 of PTE 2016-11 are replaced with the following:
PTE 2016-11 will remain in effect for the period beginning on
the Conviction Date and continuing until the earlier of: (1)
September 4, 2025 (the date that is 18 months following the
Conviction Date); or (2) the effective date of a final agency action
made by the Department in connection with a notice of proposed
exemption providing long-term exemptive relief for the covered
transactions described in PTE 2016-11 that the Department published
on January 21, 2025 (90 FR 7174) (the Extended Effective Period).
3. A new condition I(n) would be added that reads as follows:
The Northern QPAMs must maintain the records necessary to
demonstrate to the Department that each condition of PTE 2016-11 has
been met during the Extended Effective Period, and Northern QPAMs
must provide such records to the Department within 30 days after the
date of a request for such records from the Department.
Signed at Washington, DC.
George Christopher Cosby,
Director, Office of Exemption Determinations, Employee Benefits
Security Administration, U.S. Department of Labor.
[FR Doc. 2025-02930 Filed 2-20-25; 8:45 am]
BILLING CODE 4510-29-P