Sharing the Wealth – Department of Labor Clarifies Treatment of Revenue Sharing Under ERISA

July 15, 2013

The U.S. Department of Labor (the “DOL”) recently issued Advisory Opinion 2013-03A (the “Opinion”), which addresses implications under the Employee Retirement Income Security Act of 1974 (“ERISA”) surrounding certain revenue-sharing payments. The Opinion was issued in response to an application filed on behalf of a certain insurance company (the “Applicant”), and relates to the Applicant's provision of various administrative services to “401(k)” and similar participant-directed retirement plans, and the affiliated and unaffiliated investment options made available by the Applicant. The Opinion addresses the Applicant’s receipt of revenue-sharing payments from the investment options (in the form of “12b-1” fees, service fees and similar payments).

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