On Thursday, March 15, the U.S. Court of Appeals for the 5th Circuit
ruled to vacate
in its entirety the Department of Labor's (DOL) fiduciary rule. The suit, brought by a number of plaintiffs, including the U.S. Chamber of Commerce, Insured Retirement Institute (IRI), and others, argued that the fiduciary rule was too burdensome and could make providing retirement advice too costly, particularly for lower-income Americans.
The court's opinion, in part, stated that the Labor Department acted unreasonably, arbitrarily and capriciously in expanding a 40-year definition of "investment advice fiduciary" and did not deserve the deference that courts often accord federal agencies.
In light of the 5th Circuit Court's opinion,
the DOL announced
that it would not enforce the fiduciary rule "pending further review."
While the Alliance and other industry trades are still reviewing the decision, it appears that the decision, coupled with the DOL's announcement that it would not enforce the fiduciary rule, including the impartial conduct standards, the BIC exemption, and the changes to PTE 84-24, can be viewed as a victory for industry.
Additional information can be found at these industry resources: