The U.S. Department of Labor (“DOL”) has recently extended the relief previously granted to five financial institutions which allows these banks to continue to rely on the QPAM exemption (Prohibited Transaction Exemption 84-14). The QPAM exemption permits ERISA plans and comingled funds to engage in transactions with “parties in interest” to those ERISA clients without running afoul of ERISA’s prohibited transaction rules, provided that the ERISA plan or fund is managed by a qualified professional…

Although retirement plans and schemes are generally jurisdiction specific creatures, the governance of the retirement plans and schemes of multinational companies is very much a global issue.  Retirement funds, whether defined contribution plans or defined benefit plans, are essentially large pots of money (frequently in the billions of dollars) located in jurisdictions around the world.  These arrangements tend to be heavily regulated and pose numerous risks to the sponsor, including legal and regulatory compliance gaps,…

At the table in the kitchen, there were three bowls of porridge.  Goldilocks was hungry.  She tasted the porridge from the first bowl. “This porridge is too hot!” she exclaimed. So, she tasted the porridge from the second bowl. “This porridge is too cold,” she said So, she tasted the last bowl of porridge. “Ahhh, this porridge is just right,” she said happily and she ate it all up.   Virtually all companies that offer…

After working to reconcile differences between the two Tax Cuts and Jobs Act bills, the Senate and House Conference Committee reached a tentative agreement on Wednesday, December 13. Although there is not yet a published version of the Conference Committee’s bill, both the Senate and House had proposed adding a new Section 4960 to the Internal Revenue Code (Code) which would, effective for taxable years beginning after December 31, 2017, impose an excise tax of…

This post has been updated to reflect subsequent changes made by the IRS, as further described in this post. The Internal Revenue Service has released its annual cost-of-living adjustments applicable to employee benefit plans. A year-to-year comparison of limitations applicable to plan sponsors can be found here: Mayer Brown 2018 Annual Limitations Chart 2018 (updated to reflect changes described in this post). Reflecting a slight uptick in inflation in the past year, several benefit plan…

On November 16, 2017, Institutional Shareholder Services (ISS) published its updated proxy voting guidelines for the US, Canada, and Brazil effective for shareholder meetings that occur on or after February 1, 2018. In addition to many other changes, ISS addressed two issues that relate to compensation programs that should be considered by public company clients. First, ISS added a problematic compensation practice related to non-employee director compensation. ISS notes that it will generally vote against…

As we previously reported in our Legal Update, in April 2016 the U.S. Department of Labor (“DOL”) replaced its 1975 regulation that set the parameters for determining when a person should be treated as a fiduciary under ERISA when providing advice with respect to investment matters (the “Fiduciary Rule”).  The new definition treats persons who provide investment advice or recommendations for a fee or other compensation with respect to assets of a plan or…