Reorganization, Renumbering, and Reinvention of Regulations
Federal RegisterJul 1, 1996
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SUMMARY: In accordance with the President's Regulatory Reinvention
Initiative, the Pension Benefit Guaranty Corporation is reorganizing,
renumbering, and reinventing its regulations. The amendments will
clarify and simplify the PBGC's regulations and make them easier to
use.
EFFECTIVE DATE: July 1, 1996.
FOR FURTHER INFORMATION CONTACT: Harold J. Ashner, Assistant General
Counsel, or Marc L. Jordan, Attorney, Office of the General Counsel,
Pension Benefit Guaranty Corporation, 1200 K Street, NW., Washington,
DC 20005-4026, 202-326-4024 (202-326-4179 for TTY and TDD).
SUPPLEMENTARY INFORMATION: The PBGC is renumbering and reorganizing its
regulations to make it easier for practitioners and the public to
research and use the rules under Title IV of the Employee Retirement
Income Security Act of 1974. Under the new approach, the regulations
will be numbered to track the statutory sections they implement.
On July 8, 1994 (at 59 FR 35067), the PBGC published a notice in
the Federal Register inviting public comment on a proposal to
reorganize and renumber its regulations to track Title IV. No comments
were received.
On March 4, 1995, the President issued his Regulatory Reinvention
Initiative, directing Federal agencies to eliminate or revise those
regulations that are outdated or otherwise in need of reform. The PBGC
is reorganizing, renumbering, and reinventing its regulations. The
reinvention is limited to nonsubstantive corrections and clarifications
and deletion of material that is unnecessary or that has been
substantially superseded (or is no longer applicable).
For example, the reinvented regulations omit existing provisions
dealing with the allocation of residual assets (part 2618, subpart C)
because these provisions were largely superseded by changes in section
4044(d) of ERISA made by the Pension Protection Act of 1987. Similarly,
the provision regarding interest rate assumptions for paying lump sums
(existing Sec. 2619.26(b)(2)) has been eliminated because of changes in
section 417(e)(3) of the Internal Revenue Code and section 205(g)(3) of
ERISA made by the Retirement Equity Act of 1984, the Tax Reform Act of
1986, and the Retirement Protection Act of 1994.
To clarify the rules on missing participants in terminating plans,
nonsubstantive language changes have been made in the missing
participants regulation (existing part 2629, new part 4050), related
sections in the termination regulations (existing parts 2616 and 2617,
new part 4041), and in the definition of ``distribution date'' in new
Sec. 4001.2.
The new regulation on premium rates (part 4006, which contains
portions of existing part 2610) omits the variable-rate premium cap
reduction rules (which have expired) and the cap rules themselves
(repealed by the Retirement Protection Act of 1994). The rule reflects
new provisions in the Retirement Protection Act of 1994 dealing with
regulated public utility plans.
In some cases, provisions that may have been partially superseded
by statutory changes have been retained pending revision--for example,
the regulation on allocation of assets in terminating single-employer
plans (renumbered part 4044). A note at the beginning of part 4044 and
reminders within the part alert readers that some regulatory material
republished in part 4044 must be read in the light of these other
changes in the law.
The PBGC welcomes public comment on this rule to correct any
editorial errors--e.g., in cross-references--that may have been
overlooked due to the magnitude of the revision project.
Under this final rule, the PBGC's regulations will be moved from
chapter XXVI to chapter XL of title 29 of the CFR. Sections will be
numbered in the 4000's. Part 4000 consists of finding aids--tables
correlating provisions of old chapter XXVI and new chapter XL. Part
4001 contains definitions of terms used throughout the PBGC's
regulations. A table of contents showing the rest of the new structure,
along with the full text of the revised regulations, is set forth
below.
Rulemaking Requirements and E.O. 12866
The PBGC has determined that this action is not a ``significant
regulatory action'' under the criteria set forth in Executive Order
12866.
The PBGC has determined that the notice and comment requirements of
the Administrative Procedure Act (5 U.S.C. 553(b)) do not apply to this
final rule. The PBGC previously notified the public of the primary
changes made by this rule and provided an opportunity for public
comment. None of the amendments in this rule (including those that
clarify the regulations or remove or replace provisions made obsolete
by the passage of time or by subsequent statutory or regulatory
changes) affects applicable substantive legal requirements. Therefore,
the PBGC has, for good cause, found that further notice and public
procedure thereon are unnecessary.
For the same reasons, the PBGC finds pursuant to section 553(d)(3)
of the Administrative Procedure Act (5 U.S.C. 553(d)(3)) that there is
good cause to make this rule effective less than 30 days from the date
of its publication.
The PBGC also certifies that the amendments in this regulation will
not have a significant economic impact on a substantial number of small
entities. Accordingly, as provided in section 605(b) of the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.), sections 603 and 604 of the
Regulatory Flexibility Act do not apply. None of the amendments in this
rule affects applicable substantive legal requirements.
Issued in Washington, DC, on the 24th day of June 1996.
Robert B. Reich,
Chairman, Board of Directors, Pension Benefit Guaranty Corporation.
Issued on the date set forth above pursuant to a resolution of
the Board of Directors authorizing its Chairman to issue this final
rule.
James J. Keightley,
Secretary, Board of Directors Pension Benefit Guaranty Corporation.
List of Subjects in 29 CFR Chapters XXVI and XL
Parts 2601 and 4002
Authority delegations (Government agencies), Organization and
functions (Government agencies).
Part 2602
Conflict of interests, Government employees, Penalties, Political
activities (Government employees), Production and disclosure of
information, Testimony.
Parts 2603 and 4901
Freedom of Information.
Parts 2604 and 4906
Administrative practice and procedure, Conflict of interests,
Penalties.
Parts 2606 and 4003
Administrative practice and procedure, Organization and functions
[[Page 34003]]
(Government agencies), Pension insurance, Pensions.
Parts 2607 and 4902
Privacy.
Parts 2608 and 4907
Blind, Civil rights, Deaf, Disabled, Discrimination against
handicapped, Equal employment opportunity, Federal buildings and
facilities, Handicapped, Nondiscrimination, Physically handicapped.
Parts 2609 and 4903
Administrative practice and procedure, Claims, Organization and
functions (Government agencies).
Part 2610 and 4007
Penalties, Pension insurance, Pensions, Reporting and recordkeeping
requirements.
Parts 2611, 2615, 2616, 2617, 2623, 2642, 2674, 4022, 4041, 4041A,
4065, 4211, and 4245
Pension insurance, Pensions, Reporting and recordkeeping
requirements.
Parts 2612 and 4068
Business and industry, Pension insurance, Pensions, Small
businesses.
Parts 2613, 2618, 2619, 2620, 2621, 2640, 2670, 4006, 4022, 4022B,
4044, and 4061
Pension insurance, Pensions.
Parts 2622, 2643, 4062, 4063, 4064, and 4204
Business and industry, Pension insurance, Pensions, Reporting and
recordkeeping requirements, Small businesses.
Parts 2641 and 4221
Business and industry, Pensions, Small businesses.
Parts 2644, 2645, 2647, 2649, 2676, 2677, 4203, 4206, 4207, and 4220
Pensions.
Parts 2627, 2628, 2629, 2646, 2648, 2672, 2675, 4001, 4010, 4050, 4208,
4219, 4231, 4261, and 4281
Pensions, Reporting and recordkeeping requirements.
Part 2673
Pension insurance.
Part 4000
Administrative practice and procedure, Authority delegations
(Government agencies), Blind, Business and industry, Civil rights,
Claims, Conflict of interests, Deaf, Disabled, Discrimination against
handicapped, Equal employment opportunity, Federal buildings and
facilities, Freedom of Information, Government employees, Handicapped,
Nondiscrimination, Organization and functions (Government agencies),
Penalties, Pension insurance, Pensions, Physically handicapped,
Political activities (Government employees), Privacy, Production and
disclosure of information, Reporting and recordkeeping requirements,
Small businesses, Testimony.
Part 4001
Business and industry, Organization and functions (Government
agencies), Pension insurance, Pensions, Small businesses.
Part 4903
Conflict of interests, Government employees, Penalties, Political
activities (Government employees).
Part 4904
Government employees, Penalties, Production and disclosure of
information, Testimony.
For the reasons set forth above, the PBGC is amending subtitle B of
title 29 of the Code of Federal Regulations as follows:
CHAPTER XXVI--[REMOVED]
1. Chapter XXVI is removed.
2. Chapter XL is added to read as follows:
CHAPTER XL--PENSION BENEFIT GUARANTY CORPORATION
SUBCHAPTER A--GENERAL
Part 4000--Finding Aids
Sec.
4000.1 Distribution table.
4000.2 Derivation table.
Authority: 29 U.S.C. 1302(b)(3).
Part 4001--Terminology
Sec.
4001.1 Purpose and scope.
4001.2 Definitions.
4001.3 Trades or businesses under common control; controlled
groups.
Authority: 29 U.S.C. 1301(a), 1301(b)(1), 1302(b)(3).
Part 4002--Bylaws of the Pension Benefit Guaranty Corporation
Sec.
4002.1 Name.
4002.2 Offices.
4002.3 Board of Directors.
4002.4 Chairman.
4002.5 Quorum.
4002.6 Meetings.
4002.7 Place of meetings; use of conference call communications
equipment.
4002.8 Alternate voting procedure.
4002.9 Amendments.
Authority: 29 U.S.C. 1302(f).
Part 4003--Rules for Administrative Review of Agency Decisions
Subpart A--General Provisions
Sec.
4003.1 Purpose and scope.
4003.2 Definitions.
4003.3 PBGC assistance in obtaining information.
4003.4 Extension of time.
4003.5 Non-timely request for review.
4003.6 Representation.
4003.7 Exhaustion of administrative remedies.
4003.8 Request for confidential treatment.
4003.9 Filing of documents.
4003.10 Computation of time.
Subpart B--Initial Determinations
4003.21 Form and contents of initial determinations.
4003.22 Effective date of determinations.
Subpart C--Reconsideration of Initial Determinations
4003.31 Who may request reconsideration.
4003.32 When to request reconsideration.
4003.33 Where to submit request for reconsideration.
4003.34 Form and contents of request for reconsideration.
4003.35 Final decision on request for reconsideration.
Subpart D--Administrative Appeals
4003.51 Who may appeal or participate in appeals.
4003.52 When to file.
4003.53 Where to file.
4003.54 Contents of appeal.
4003.55 Opportunity to appear and to present witnesses.
4003.56 Consolidation of appeals.
4003.57 Appeals affecting third parties.
4003.58 Powers of the Appeals Board.
4003.59 Decision by the Appeals Board.
4003.60 Referral of appeal to the Executive Director.
Authority: 29 U.S.C. 1302(b)(3).
SUBCHAPTER B--PREMIUMS
Part 4006--Premium Rates
Sec.
4006.1 Purpose and scope.
4006.2 Definitions.
4006.3 Premium rate.
4006.4 Determination of unfunded vested benefits.
4006.5 Exemptions and special rules.
Authority: 29 U.S.C. 1302(b)(3), 1306, 1307.
Part 4007--Payment of Premiums
Sec.
4007.1 Purpose and scope.
4007.2 Definitions.
4007.3 Filing requirement and forms.
4007.4 Filing address.
4007.5 Date of filing.
4007.6 Computation of time.
4007.7 Late payment interest charges.
4007.8 Late payment penalty charges.
4007.9 Coverage for guaranteed basic benefits.
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4007.10 Recordkeeping requirements; PBGC audits.
4007.11 Due dates.
4007.12 Liability for single-employer premiums.
Authority: 29 U.S.C. 1302(b)(3), 1306, 1307.
SUBCHAPTER C--CERTAIN REPORTING AND DISCLOSURE REQUIREMENTS
Part 4010--Annual Financial and Actuarial Information Reporting
Sec.
4010.1 Purpose and scope.
4010.2 Definitions.
4010.3 Filing requirement.
4010.4 Filers.
4010.5 Information year.
4010.6 Information to be filed.
4010.7 Identifying information.
4010.8 Plan actuarial information.
4010.9 Financial information.
4010.10 Due date and filing with the PBGC.
4010.11 Waivers and extensions.
4010.12 Confidentiality of information submitted.
4010.13 Penalties.
4010.14 OMB control number.
Authority: 29 U.S.C. 1302(b)(3); 29 U.S.C. 1310.
Part 4011--Disclosure to Participants
Sec.
4011.1 Purpose and scope.
4011.2 Definitions.
4011.3 Notice requirement.
4011.4 Small plan rules.
4011.5 Exemption for new and newly-covered plans.
4011.6 Mergers, consolidations, and spinoffs.
4011.7 Persons entitled to receive notice.
4011.8 Time of notice.
4011.9 Manner of issuance of notice.
4011.10 Form of notice.
4011.11 OMB control number.
Appendix A to part 4011--Model participant notice.
Appendix B to part 4011--Table of maximum guaranteed benefits.
Authority: 29 U.S.C. 1302(b)(3), 1311.
SUBCHAPTER D--COVERAGE AND BENEFITS
Part 4022--Benefits Payable in Terminated Single-Employer Plans
Subpart A--General Provisions; Guaranteed Benefits
Sec.
4022.1 Purpose and scope.
4022.2 Definitions.
4022.3 Guaranteed benefits.
4022.4 Entitlement to a benefit.
4022.5 Determination of nonforfeitable benefits.
4022.6 Annuity payable for total disability.
4022.7 Benefits payable in a single installment.
Subpart B--Limitations on Guaranteed Benefits
4022.21 Limitations; in general.
4022.22 Maximum guaranteeable benefit.
4022.23 Computation of maximum guaranteeable benefit.
4022.24 Benefit increases.
4022.25 Five-year phase-in of benefit guarantee for participants
other than substantial owners.
4022.26 Phase-in of benefit guarantee for participants who are
substantial owners.
4022.27 Effect of tax disqualification.
Subpart C--Calculation and Payment of Unfunded Nonguaranteed Benefits
[Reserved]
Subpart D--Benefit Reductions in Terminating Plans
4022.61 Limitations on benefit payments by plan administrator.
4022.62 Estimated guaranteed benefit.
4022.63 Estimated title IV benefit.
Subpart E--PBGC Recoupment and Reimbursement of Benefit Overpayments
and Underpayments
4022.81 General rules.
4022.82 Method of recoupment.
4022.83 PBGC reimbursement of benefit underpayments.
Appendix to Part 4022--Maximum Guaranteeable Monthly Benefit
Authority: 29 U.S.C. 1302(b)(3), 1322, 1322b, 1341(c)(3)(D),
1344.
Part 4022B--Aggregate Limits on Guaranteed Benefits
Sec.
4022B.1 Aggregate payments limitation.
Authority: 29 U.S.C. 1302(b)(3).
SUBCHAPTER E--PLAN TERMINATIONS
Part 4041--Termination of Single-Employer Plans
Subpart A--General Provisions
Sec.
4041.1 Purpose and scope.
4041.2 Definitions.
4041.3 Requirements for a standard or a distress termination.
4041.4 Administration of plan during pendency of termination
proceedings.
4041.5 Challenges to plan termination under collective bargaining
agreement.
4041.6 Annuity requirements.
4041.7 Facilitating plan sufficiency in a standard termination.
4041.8 Disaster relief--distress termination.
4041.9 Filing with the PBGC.
4041.10 Computation of time.
4041.11 Maintenance of plan records.
4041.12 Information collection.
Subpart B--Standard Terminations
4041.21 Notice of intent to terminate.
4041.22 Issuance of notices of plan benefits.
4041.23 Form and contents of notices of plan benefits.
4041.24 Standard termination notice.
4041.25 PBGC action upon filing of standard termination notice.
4041.26 Notice of noncompliance.
4041.27 Closeout of plan.
Subpart C--Distress Terminations
4041.41 Notice of intent to terminate.
4041.42 PBGC review of notice of intent to terminate.
4041.43 Distress termination notice.
4041.44 PBGC determination of compliance with requirements for
distress termination.
4041.45 PBGC determination of plan sufficiency/insufficiency.
4041.46 Notices of benefit distribution.
4041.47 Verification of plan sufficiency prior to closeout.
4041.48 Closeout of plan.
Appendix to Part 4041--Agreement for Commitment to Make Plan
Sufficient for Benefit Liabilities
Authority: 29 U.S.C. 1302(b)(3), 1341, 1344.
Part 4041A--Termination of Multiemployer Plans
Subpart A--General Provisions
Sec.
4041A.1 Purpose and scope.
4041A.2 Definitions.
4041A.3 Submission of documents.
Subpart B--Notice of Termination
4041A.11 Requirement of notice.
4041A.12 Contents of notice.
Subpart C--Plan Sponsor Duties
4041A.21 General rule.
4041A.22 Payment of benefits.
4041A.23 Imposition and collection of withdrawal liability.
4041A.24 Annual plan valuations and monitoring.
4041A.25 Periodic determinations of plan solvency.
4041A.26 Financial assistance.
4041A.27 PBGC approval to pay benefits not otherwise permitted.
Subpart D--Closeout of Sufficient Plans
4041A.41 General rule.
4041A.42 Method of distribution.
4041A.43 Benefit forms.
4041A.44 Cessation of withdrawal liability.
Authority: 29 U.S.C. 1302(b)(3), 1341a, 1441.
Part 4043--Reportable Events and Certain Other Notification
Requirements
Subpart A--Reportable Events; In General
Sec.
4043.1 Purpose and scope.
4043.2 Definitions.
4043.3 Requirement of notice.
4043.4 Reporting of reportable events on annual report.
4043.5 Obligation of contributing sponsor.
4043.6 Date of filing.
4043.7 Computation of time.
4043.11 Tax disqualification.
4043.12 Title I non-compliance.
4043.13 Amendment decreasing benefits payable.
4043.14 Active participant reduction.
4043.15 Termination or partial termination.
4043.16 Failure to meet minimum funding standards and granting of
funding waiver.
4043.17 Inability to pay benefits when due.
4043.18 Distribution to a substantial owner.
4043.19 Plan merger, consolidation or transfer.
[[Page 34005]]
4043.20 Alternative compliance with reporting and disclosure
requirements of Title I.
4043.21 Bankruptcy, insolvency, or similar settlements.
4043.22 Liquidation or dissolution.
4043.23 Transactions involving a change in contributing sponsor or
controlled group.
Subpart B--Section 302(f); Notice of Failure to Make Required
Contributions
4043.31 PBGC Form 200, notice of failure to make required
contributions.
Authority: 29 U.S.C. 1302(b)(3), 1343, 1365.
Part 4044--Allocation of Assets in Single-Employer Plans
Subpart A--Allocation of Assets
General Provisions
Sec.
4044.1 Purpose and scope of subpart A.
4044.2 Definitions.
4044.3 General rule.
4044.4 Violations.
Allocation of Assets to Benefit Categories
4044.10 Manner of allocation.
4044.11 Priority category 1 benefits.
4044.12 Priority category 2 benefits.
4044.13 Priority category 3 benefits.
4044.14 Priority category 4 benefits.
4044.15 Priority category 5 benefits.
4044.16 Priority category 6 benefits.
4044.17 Subclasses.
Allocation of Residual Assets
4044.30 [Reserved.]
Subpart B--Valuation of Benefits and Assets
4044.41 General valuation rules.
Trusteed Plans
4044.51 Benefits to be valued.
4044.52 Valuation of benefits.
4044.53 Mortality assumptions--in general.
4044.54 Mortality assumptions--lump sums.
Expected Retirement Age
4044.55 XRA when a participant must retire to receive a benefit.
4044.56 XRA when a participant need not retire to receive a
benefit.
4044.57 Special rule for facility closing.
Non-Trusteed Plans
4044.71 Valuation of annuity benefits.
4044.72 Form of annuity to be valued.
4044.73 Lump sums and other alternative forms of distribution in
lieu of annuities.
4044.74 Withdrawal of employee contributions.
4044.75 Other lump sum benefits.
Appendix A to Part 4044--Mortality Rate Tables
Appendix B to Part 4044--Interest Rates Used to Value Annuities and
Lump Sums
Appendix C to Part 4044--Loading Assumptions
Appendix D to Part 4044--Tables Used To Determine Expected
Retirement Age
Authority: 29 U.S.C. 1301(a), 1302(b)(3), 1341, 1344, 1362.
Part 4047--Restoration of Terminating and Terminated Plans
Sec.
4047.1 Purpose and scope.
4047.2 Definitions.
4047.3 Funding of restored plan.
4047.4 Payment of premiums.
4047.5 Repayment of PBGC payments of guaranteed benefits.
Authority: 29 U.S.C. 1302(b)(3), 1347.
Part 4050--Missing Participants
Sec.
4050.1 Purpose and scope.
4050.2 Definitions.
4050.3 Method of distribution for missing participants.
4050.4 Diligent search.
4050.5 Designated benefit.
4050.6 Payment and required documentation.
4050.7 Benefits of missing participants--in general.
4050.8 Automatic lump sum.
4050.9 Annuity or elective lump sum--living missing participant.
4050.10 Annuity or elective lump sum--beneficiary of deceased
missing participant.
4050.11 Limitations.
4050.12 Special rules.
4050.13 OMB control number.
SUBCHAPTER F--LIABILITY
Part 4061--Amounts Payable by the Pension Benefit Guaranty Corporation
Sec.
4061.1 Cross-references.
Authority: 29 U.S.C. 1302(b)(3).
Part 4062--Liability for Termination of Single-Employer Plans
Sec.
4062.1 Purpose and scope.
4062.2 Definitions.
4062.3 Amount and payment of section 4062(b) liability.
4062.4 Determinations of net worth and collective net worth.
4062.5 Net worth record date.
4062.6 Net worth notification and information.
4062.7 Calculating interest on liability and refunds of
overpayments.
4062.8 Arrangements for satisfying liability.
4062.9 Notification of and demand for liability.
4062.10 Filing of documents.
4062.11 Computation of time.
Part 4063--Withdrawal Liability; Plans Under Multiple Controlled Groups
Sec.
4063.1 Cross-references.
Authority: 29 U.S.C. 1302(b)(3).
Part 4064--Liability on Termination of Single-Employer Plans Under
Multiple Controlled Groups
Sec.
4064.1 Cross-references.
Authority: 29 U.S.C. 1302(b)(3).
SUBCHAPTER G--ANNUAL REPORTING REQUIREMENTS
Part 4065--Annual Report
Sec.
4065.1 Purpose and scope.
4065.2 Definitions.
4065.3 Filing requirement.
Authority: 29 U.S.C. 1302, 1365.
SUBCHAPTER H--ENFORCEMENT PROVISIONS
Part 4067--Recovery of Liability for Plan Terminations
Sec.
4067.1 Cross-reference.
Authority: 29 U.S.C. 1302, 1367.
Part 4068--Lien for Liability
Sec.
4068.1 Purpose; cross-references.
4068.2 Definitions.
4068.3 Notification of and demand for liability.
4068.4 Lien.
Authority: 29 U.S.C. 1302(b)(3), 1368.
SUBCHAPTER I--WITHDRAWAL LIABILITY FOR MULTIEMPLOYER PLANS
Part 4203--Extension of Special Withdrawal Liability Rules
Sec.
4203.1 Purpose and scope.
4203.2 Plan adoption of special withdrawal rules.
4203.3 Requests for PBGC approval of plan amendments.
4203.4 PBGC action on requests.
4203.5 OMB control number.
Authority: 29 U.S.C. 1302(b)(3), 1383(f), 1388(e)(3).
Part 4204--Variances for Sale of Assets
Subpart A--General
Sec.
4204.1 Purpose and scope.
4204.2 Definitions.
Subpart B--Variance of the Statutory Requirements
4204.11 Variance of the bond/escrow and sale-contract requirements.
4204.12 De minimis transactions.
4204.13 Net income and net tangible assets tests.
Subpart C--Procedures for Individual and Class Variances or Exemptions
4204.21 Requests to PBGC for variances and exemptions.
4204.22 PBGC action on requests.
Authority: 29 U.S.C. 1302(b)(3), 1384(c).
Part 4206--Adjustment of Liability for a Withdrawal Subsequent to a
Partial Withdrawal
Sec.
4206.1 Purpose and scope.
4206.2 Definitions.
4206.3 Credit against liability for a subsequent withdrawal.
4206.4 Amount of credit in plans using the presumptive method.
4206.5 Amount of credit in plans using the modified presumptive
method.
[[Page 34006]]
4206.6 Amount of credit in plans using the rolling-5 method.
4206.7 Amount of credit in plans using the direct attribution
method.
4206.8 Reduction of credit for abatement or other reduction of
prior partial withdrawal liability.
4206.9 Amount of credit in plans using alternative allocation
methods.
4206.10 Special rule for 70-percent decline partial withdrawals.
Authority: 29 U.S.C. 1302(b)(3), 1386(b).
Part 4207--Reduction or Waiver of Complete Withdrawal Liability
Sec.
4207.1 Purpose and scope.
4207.2 Definitions.
4207.3 Abatement.
4207.4 Withdrawal liability payments during pendency of abatement
determination.
4207.5 Requirements for abatement.
4207.6 Partial withdrawals after reentry.
4207.7 Liability for subsequent complete withdrawals and related
adjustments for allocating unfunded vested benefits.
4207.8 Liability for subsequent partial withdrawals.
4207.9 Special rules.
4207.10 Plan rules for abatement.
Authority: 29 U.S.C. 1302(b)(3), 1387.
Part 4208--Reduction or Waiver of Partial Withdrawal Liability
Sec.
4208.1 Purpose and scope.
4208.2 Definitions.
4208.3 Abatement.
4208.4 Conditions for abatement.
4208.5 Withdrawal liability payments during pendency of abatement
determination.
4208.6 Computation of reduced annual partial withdrawal liability
payment.
4208.7 Adjustment of withdrawal liability for subsequent
withdrawals.
4208.8 Multiple partial withdrawals in one plan year.
4208.9 Plan adoption of additional abatement conditions.
Authority: 29 U.S.C. 1302(b)(3), 1388 (c) and (e).
Part 4211--Allocating Unfunded Vested Benefits
Subpart A--General
Sec.
4211.1 Purpose and scope.
4211.2 Definitions.
4211.3 Special rules for construction industry and IRC section
404(c) plans.
Subpart B--Changes Not Subject to PBGC Approval
4211.11 Changes not subject to PBGC approval.
4211.12 Modifications to the presumptive, modified presumptive and
rolling-5 methods.
4211.13 Modifications to the direct attribution method.
Subpart C--Changes Subject to PBGC Approval
4211.21 Changes subject to PBGC approval.
4211.22 Requests for PBGC approval.
4211.23 Approval of alternative method.
4211.24 Special rule for certain alternative methods previously
approved.
Subpart D--Allocation Methods for Merged Multiemployer Plans
4211.31 Allocation of unfunded vested benefits following the merger
of plans.
4211.32 Presumptive method for withdrawals after the initial plan
year.
4211.33 Modified presumptive method for withdrawals after the
initial plan year.
4211.34 Rolling-5 method for withdrawals after the initial plan
year.
4211.35 Direct attribution method for withdrawals after the initial
plan year.
4211.36 Modifications to the determination of initial liabilities,
the amortization of initial liabilities, and the allocation
fraction.
4211.37 Allocating unfunded vested benefits for withdrawals before
the end of the initial plan year.
Authority: 29 U.S.C. 1302(b)(3), 1391 (c)(1), (c)(2)(D),
(c)(5)(A), (c)(5)(B), (c)(5) (D), and (f).
Part 4219--Notice, Collection, and Redetermination of Withdrawal
Liability
Subpart A--General
Sec.
4219.1 Purpose and scope.
4219.2 Definitions.
Subpart B--Redetermination of Withdrawal Liability Upon Mass Withdrawal
4219.11 Withdrawal liability upon mass withdrawal.
4219.12 Employers liable upon mass withdrawal.
4219.13 Amount of liability for de minimis amounts.
4219.14 Amount of liability for 20-year-limitation amounts.
4219.15 Determination of reallocation liability.
4219.16 Imposition of liability.
4219.17 Filings with PBGC.
4219.18 Withdrawal in a plan year in which substantially all
employers withdraw.
4219.19 Information collection.
Subpart C--Overdue, Defaulted, and Overpaid Withdrawal Liability
Sec.
4219.31 Overdue and defaulted withdrawal liability; overpayment.
4219.32 Interest on overdue, defaulted and overpaid withdrawal
liability.
4219.34 Plan rules concerning overdue and defaulted withdrawal
liability.
Authority: 29 U.S.C. 1302(b)(3), 1389 (c) and (d), 1399
(c)(1)(D) and (c)(6).
Part 4220--Procedures for PBGC Approval of Plan Amendments
Sec.
4220.1 Purpose and scope.
4220.2 Requests for PBGC approval.
4220.3 PBGC action on requests.
Authority: 29 U.S.C. 1302(b)(3), 1400.
Part 4221--Arbitration of Disputes in Multiemployer Plans
Sec.
4221.1 Purpose and scope.
4221.2 Definitions.
4221.3 Initiation of arbitration.
4221.4 Appointment of the arbitrator.
4221.5 Powers and duties of the arbitrator.
4221.6 Hearing.
4221.7 Reopening of proceedings.
4221.8 Award.
4221.9 Reconsideration of award.
4221.10 Costs.
4221.11 Waiver of rules.
4221.12 Calculation of periods of time.
4221.13 Filing or service of documents.
4221.14 PBGC-approved arbitration procedures.
Authority: 29 U.S.C. 1302(b)(3), 1401.
SUBCHAPTER J--INSOLVENCY, REORGANIZATION, TERMINATION, AND OTHER RULES
APPLICABLE TO MULTIEMPLOYER PLANS
Part 4231--Mergers and Transfers Between Multiemployer Plans
Sec.
4231.1 Purpose and scope.
4231.2 Definitions.
4231.3 Requirements for mergers and transfers.
4231.4 Preservation of accrued benefits.
4231.5 Valuation requirement.
4231.6 Plan solvency tests.
4231.7 De minimis mergers and transfers.
4231.8 Notice of merger or transfer.
4231.9 Request for compliance determination.
4231.10 Actuarial calculations and assumptions.
Authority: 29 U.S.C. 1302(b)(3), 1411.
Part 4245--Notice of Insolvency
Sec.
4245.1 Purpose and scope.
4245.2 Definitions.
4245.3 Notice of insolvency.
4245.4 Contents of notice of insolvency.
4245.5 Notice of insolvency benefit level.
4245.6 Contents of notice of insolvency benefit level.
4245.7 PBGC address.
Authority: 29 U.S.C. 1302(b)(3), 1426(e).
Part 4261--Financial Assistance to Multiemployer Plans
Sec.
4261.1 Cross-reference.
Authority: 29 U.S.C. 1302(b)(3).
Part 4281--Duties of Plan Sponsor Following Mass Withdrawal
Subpart A--General
Sec.
4281.1 Purpose and scope.
4281.2 Definitions.
4281.3 Submission of documents.
4281.4 Collection of information.
Subpart B--Valuation of Plan Benefits and Plan Assets
4281.11 Valuation dates.
4281.12 Benefits to be valued.
4281.13 Benefit valuation methods--in general.
[[Page 34007]]
4281.14 Mortality assumptions--in general.
4281.15 Mortality assumptions--lump sums under trusteed plans.
4281.16 Benefit valuation methods--plans closing out.
4281.17 Asset valuation methods--in general.
4281.18 Outstanding claims for withdrawal liability.
Subpart C--Benefit Reductions
4281.31 Plan amendment.
4281.32 Notices of benefit reductions.
4281.33 Restoration of benefits.
Subpart D--Benefit Suspensions
4281.41 Benefit suspensions.
4281.42 Retroactive payments.
4281.43 Notices of insolvency and annual updates.
4281.44 Contents of notices of insolvency and annual updates.
4281.45 Notices of insolvency benefit level.
4281.46 Contents of notices of insolvency benefit level.
4281.47 Application for financial assistance.
Appendix A to Part 4281--Interest Rates Used to Value Lump Sums and
Annuities
Appendix B to Part 4281--Loading Assumptions
Authority: 29 U.S.C. 1302(b)(3), 1341a, 1399(c)(1)(D), and 1441.
SUBCHAPTER K--INTERNAL AND ADMINISTRATIVE RULES AND PROCEDURES
Part 4901--Examination and Copying of Pension Benefit Guaranty
Corporation Records
Subpart A--General
Sec.
4901.1 Purpose and scope.
4901.2 Definitions.
4901.3 Disclosure facilities.
4901.4 Information maintained in public reference room.
4901.5 Disclosure of other information.
Subpart B--Procedure for Formal Requests
4901.11 Submittal of requests for access to records.
4901.12 Description of information requested.
4901.13 Receipt by agency of request.
4901.14 Action on request.
4901.15 Appeals from denial of requests.
4901.16 Extensions of time.
4901.17 Exhaustion of administrative remedies.
Subpart C--Restrictions on Disclosure
4901.21 Restrictions in general.
4901.22 Partial disclosure.
4901.23 Records of concern to more than one agency.
4901.24 Special rules for trade secrets and confidential commercial
or financial information submitted to the PBGC.
Subpart D--Fees
4901.31 Charges for services.
4901.32 Fee schedule.
4901.33 Payment of fees.
4901.34 Waiver or reduction of charges.
Authority: 5 U.S.C. 552; 29 U.S.C. 1302(b)(3); E.O. 12600, 52 FR
23781.
Part 4902--Disclosure and Amendment of Records Under the Privacy Act
Sec.
4902.1 Purpose and scope.
4902.2 Definitions.
4902.3 Procedures for determining existence of and requesting
access to records.
4902.4 Disclosure of record to an individual.
4902.5 Procedures for requesting amendment of a record.
4902.6 Action on request for amendment of a record.
4902.7 Appeal of a denial of a request for amendment of a record.
4902.8 Fees.
4902.9 Specific exemptions.
Authority: 5 U.S.C. 552a; 29 U.S.C. 1302(b)(3).
Part 4903--Debt Collection
Subpart A--General
Sec.
4903.1 Purpose and scope.
4903.2 General.
4903.3 Definitions.
Subpart B--Administrative Offset
4903.21 Application of Federal Claims Collection Standards.
4903.22 Administrative offset procedures.
4903.23 PBGC requests for offset to other agencies.
4903.24 Requests for offset from other agencies.
Subpart C--Tax Refund Offset
4903.31 Eligibility of debt for tax refund offset.
4903.32 Tax refund offset procedures.
4903.33 Referral of debt for tax refund offset.
Subpart D--Salary Offset [Reserved]
Authority: 29 U.S.C. 1302(b); 31 U.S.C. 3701, 3711(f), 3720A; 4
CFR part 102; 26 CFR 301.6402-6.
Part 4904--Ethical Conduct of Employees
Sec.
4904.1 Ethical conduct; standards and requirements.
Authority: 29 U.S.C. 1302(b)(3).
Part 4905--Appearances in Certain Proceedings
Sec.
4905.1 Purpose and scope.
4905.2 Definitions.
4905.3 General.
4905.4 Appearances by PBGC employees.
4905.5 Requests for authenticated copies of PBGC records.
4905.6 Penalty.
Authority: 29 U.S.C. 1302(b).
Part 4906--[Reserved]
Part 4907--Enforcement of Nondiscrimination on the Basis of Handicap in
Programs or Activities Conducted by the Pension Benefit Guaranty
Corporation
Sec.
4907.101 Purpose.
4907.102 Application.
4907.103 Definitions.
4907.110 Self-evaluation.
4907.111 Notice.
4907.130 General prohibitions against discrimination.
4907.140 Employment.
4907.149 Program accessibility: Discrimination prohibited.
4907.150 Program accessibility: Existing facilities.
4907.151 Program accessibility: New construction and alterations.
4907.160 Communications.
4907.170 Compliance procedures.
Authority: 29 U.S.C. 794, 1302(b)(3).
PART 4000--FINDING AIDS
Sec.
4000.1 Distribution table.
4000.2 Derivation table.
Authority: 29 U.S.C. 1302(b)(3).
Sec. 4000.1 Distribution table.
The following table shows where in chapter XL of 29 CFR to find
regulations previously codified in chapter XXVI.
------------------------------------------------------------------------
Ch. XL Part(s)/Subpart(s)
Ch. XXVI Part Subpart(s)/Section(s) Subpart(s)/Section(s)
------------------------------------------------------------------------
Subchapter A--Internal and Administrative Rules
------------------------------------------------------------------------
2601................................... 4002
2602:
Subpart A.......................... 4904
Subpart B.......................... 4905
2603................................... 4901
2604................................... Repealed
2606................................... 4003
2607................................... 4902
2608................................... 4907
[[Page 34008]]
2609................................... 4903
------------------------------------------------------------------------
Subchapter B--Rules Applicable to Single-Employer and Multiemployer
Plans
------------------------------------------------------------------------
2610................................... 4006 & 4007
Secs. 2610.1, 2610.21, 2610.31.... Secs. 4006.1 & 4007.1
Secs. 2610.2...................... Secs. 4006.2 & 4007.2
Secs. 2610.3-2610.9 & 2610.11..... 4007
Sec. 2610.10...................... 4006.5(e)
Secs. 2610.22-2610.24 & 2610.33... 4006
Secs. 2610.25, 2610.26 & 2610.34.. 4007
2611................................... 4065
2612................................... 4001, Subpart B
2613................................... 4022, Subpart A
------------------------------------------------------------------------
Subchapter C--Single-Employer Plans
------------------------------------------------------------------------
2615................................... 4043
2616................................... 4041
Subpart A.......................... Subpart A
Subpart B.......................... Subpart C
2617................................... 4041
Subpart A.......................... Subpart A
Subpart B.......................... Subpart B
2618................................... 4044, Subpart A
2619................................... 4044, Subpart B
2620................................... 4044, Subpart B
2621 (except Sec. 2621.23(b))......... 4022, Subpart B
2621.23(b)............................. 4022B
2622 (except 2622.9)................... 4062
Sec. 2622.9....................... 4068
2623................................... 4022, Subparts D & E
2625................................... 4047
2627................................... 4011
2628................................... 4010
2629................................... 4050
------------------------------------------------------------------------
Subchapter F--Withdrawal Liability in Multiemployer Plans
------------------------------------------------------------------------
2640:
Sec. 2640.2....................... Sec. 4001.2
Sec. 2640.3....................... Sec. 4221.2
Sec. 2640.4....................... Sec. 4211.2
Sec. 2640.5....................... Sec. 4204.2
Sec. 2640.6....................... Sec. 4207.2, 4208.2
Sec. 2640.7....................... Sec. 4219.2
Sec. 2640.8....................... Sec. 4206.2
2641................................... 4221
2642................................... 4211
2643................................... 4204
2644................................... 4219, Subpart C
2645................................... 4203
2646................................... 4208
2647................................... 4207
2648................................... 4219, Subpart B
2649................................... 4206
------------------------------------------------------------------------
Subchapter H--Other Rules Applicable to Multiemployer Plans
------------------------------------------------------------------------
2670:
Sec. 2670.2....................... Sec. 4001.2
Sec. 2670.3....................... Sec. 4231.2
Sec. 2670.4....................... Secs. 4041A.2, 4245.2, &
4281.2
2672................................... 4231
2673................................... 4041A, Subpart B, & 4041A.3(a)
2674................................... 4245
2675................................... 4041A, Subparts C & D, & 4281,
Subparts C & D
2676................................... 4281, Subpart B
2677................................... 4220
------------------------------------------------------------------------
Sec. 4000.2 Derivation table.
The following table shows where in previous chapter XXVI of 29 CFR
to find regulations now codified in chapter XL.
[[Page 34009]]
------------------------------------------------------------------------
Ch. XXVI Part(s) Subpart/
Ch. XL Part Subpart/Section(s) Section(s)
------------------------------------------------------------------------
Subchapter A--General
------------------------------------------------------------------------
4000................................... [tables]
4001:
Subpart A.......................... [various statutory and
regulatory definitions]
Subpart B.......................... 2612
4002................................... 2601
4003................................... 2606
------------------------------------------------------------------------
Subchapter B--Premiums
------------------------------------------------------------------------
4006................................... 2610
4007................................... 2610
------------------------------------------------------------------------
Subchapter C--Certain Reporting and Disclosure Requirements
------------------------------------------------------------------------
4010................................... 2628
4011................................... 2627
------------------------------------------------------------------------
Subchapter D--Coverage and Benefits
------------------------------------------------------------------------
4022:
Subpart A.......................... 2613
Subpart B.......................... 2621 (except Sec. 2621.23(b))
Subparts D & E..................... 2623
4022B.................................. Sec. 2621.23(b)
------------------------------------------------------------------------
Subchapter E--Plan Terminations
------------------------------------------------------------------------
4041:
Subpart A.......................... Secs. 2616 & 2617, Subparts A
Subpart B.......................... 2617, Subpart B
Subpart C.......................... 2616, Subpart B
4041A:
Subpart A.......................... Secs. 2670.4, 2673.1, 2673.4,
2675.1 & 2675.2
Subpart B.......................... Secs. 2673.2 & .3
Subparts C & D..................... 2675, Subparts B & E
4043................................... 2615
4044................................... 2618, 2619 & 2620
4047................................... 2625
4050................................... 2629
------------------------------------------------------------------------
Subchapter F--Liability
------------------------------------------------------------------------
4061................................... [cross-references]
4062................................... 2622 (except Sec. 2622.9)
4063................................... [cross-references]
4064................................... [cross-references]
------------------------------------------------------------------------
Subchapter G--Annual Reporting Requirements
------------------------------------------------------------------------
4065................................... 2611
------------------------------------------------------------------------
Subchapter H--Enforcement Provisions
------------------------------------------------------------------------
4067................................... [cross-reference]
4068................................... 2622.9
Subchapter I--Withdrawal Liability in Multiemployer Plans
------------------------------------------------------------------------
4203................................... 2645
4204................................... 2643 & Sec. 2640.5
4206................................... 2649 & Sec. 2640.8
4207................................... 2647 & 2640.6
4208................................... 2646 & 2640.6
4211................................... 2642 & 2640.4
4219:
Subpart A.......................... Sec. 2640.7
Subpart B.......................... 2648
Subpart C.......................... 2644
4220................................... 2677
4221................................... 2641 & Sec. 2640.3
------------------------------------------------------------------------
Subchapter J--Insolvency, Reorganization, Termination, and Other Rules
Applicable to Multiemployer Plans
------------------------------------------------------------------------
4231................................... 2672 & Sec. 2670.3
[[Page 34010]]
4245................................... 2674 & 2670.4
4261................................... [cross-reference]
4281:
Subpart A.......................... 2675, Subpart A, & 2670.4
Subpart B.......................... 2676
Subpart C.......................... 2675, Subpart C
Subpart D.......................... 2675, Subpart D
------------------------------------------------------------------------
Subchapter K--Internal Administrative Rules and Procedures
------------------------------------------------------------------------
4901................................... 2603
4902................................... 2607
4903................................... 2609
4904................................... 2602, Subpart A
4905................................... 2602, Subpart B
4907................................... 2608
------------------------------------------------------------------------
PART 4001--TERMINOLOGY
Sec.
4001.1 Purpose and scope.
4001.2 Definitions.
4001.3 Trades or businesses under common control; controlled
groups.
Authority: 29 U.S.C. 1301, 1302(b)(3).
Sec. 4001.1 Purpose and scope.
This part contains definitions of certain terms used in this
chapter and the regulations under which the PBGC makes various
controlled group determinations.
Sec. 4001.2 Definitions.
For purposes of this chapter (unless otherwise indicated or
required by the context):
Affected party means, with respect to a plan--
(1) Each participant in the plan;
(2) Each beneficiary of a deceased participant;
(3) Each alternate payee under an applicable qualified domestic
relations order, as defined in section 206(d)(3) of ERISA;
(4) Each employee organization that currently represents any group
of participants;
(5) For any group of participants not currently represented by an
employee organization, the employee organization, if any, that last
represented such group of participants within the 5-year period
preceding issuance of the notice of intent to terminate; and
(6) the PBGC. If an affected party has designated, in writing, a
person to receive a notice on behalf of the affected party, any
reference to the affected party (in connection with the notice) shall
be construed to refer to such person.
Annuity means a series of periodic payments to a participant or
surviving beneficiary for a fixed or contingent period.
Basic-type benefit means a benefit that is guaranteed under the
provisions of part 4022, subpart A, of this chapter, or would be
guaranteed if the guarantee limits in part 4022, subpart B, of this
chapter did not apply.
Benefit liabilities means the benefits of participants and their
beneficiaries under the plan (within the meaning of section 401(a)(2)
of the Code).
Code means the Internal Revenue Code of 1986, as amended.
Complete withdrawal means a complete withdrawal as described in
section 4203 of ERISA.
Contributing sponsor means a person who is a contributing sponsor
as defined in section 4001(a)(13) of ERISA.
Controlled group means, in connection with any person, a group
consisting of such person and all other persons under common control
with such person, determined under section 4001.3 of this part. For
purposes of determining the persons liable for contributions under
section 412(c)(11)(B) of the Code or section 302(c)(11)(B) of ERISA, or
for premiums under section 4007(e)(2) of ERISA, a controlled group also
includes any group treated as a single employer under section 414 (m)
or (o) of the Code.
Corporation means the Pension Benefit Guaranty Corporation, except
where the context demonstrates that a different meaning is intended.
Defined benefit plan means a plan described in section 3(35) of
ERISA.
Distress termination means the voluntary termination of a single-
employer plan in accordance with section 4041(c) of ERISA and part
4041, subpart C, of this chapter.
Distribution date means:
(1) Except as provided in paragraph (2)--
(i) For benefits provided through the purchase of irrevocable
commitments, the date on which the obligation to provide the benefits
passes from the plan to the insurer; and
(ii) For benefits provided other than through the purchase of
irrevocable commitments, the date on which the benefits are delivered
to the participant or beneficiary (or to another plan or benefit
arrangement or other recipient authorized by the participant or
beneficiary in accordance with applicable law and regulations)
personally or by deposit with a mail or courier service (as evidenced
by a postmark or written receipt); or
(2) Other than for purposes of determining the interest rate to be
used in calculating the value of a benefit to be paid as a lump sum to
a late-discovered participant, the deemed distribution date (as defined
in Sec. 4050.2) in the case of a designated benefit paid to the PBGC, a
benefit provided after the deemed distribution date to a late-
discovered participant, or an irrevocable commitment purchased from an
insurer after the deemed distribution date for a recently-missing
participant in accordance with part 4050 of this chapter (dealing with
missing participants).
Employer means all trades or businesses (whether or not
incorporated) that are under common
[[Page 34011]]
control, within the meaning of Sec. 4001.3 of this chapter.
ERISA means the Employee Retirement Income Security Act of 1974, as
amended.
Fair market value means the price at which property would change
hands between a willing buyer and a willing seller, neither being under
any compulsion to buy or sell and both having reasonable knowledge of
relevant facts.
FOIA means the Freedom of Information Act, as amended (5 U.S.C.
552).
Funding standard account means an account established and
maintained under section 302(b) of ERISA or section 412(b) of the Code.
Guaranteed benefit means a benefit under a single-employer plan
that is guaranteed by the PBGC under section 4022(a) of ERISA and part
4022 of this chapter, or a benefit under a multiemployer plan that is
guaranteed by the PBGC under section 4022A of ERISA.
Insurer means a company authorized to do business as an insurance
carrier under the laws of a State or the District of Columbia.
Irrevocable commitment means an obligation by an insurer to pay
benefits to a named participant or surviving beneficiary, if the
obligation cannot be cancelled under the terms of the insurance
contract (except for fraud or mistake) without the consent of the
participant or beneficiary and is legally enforceable by the
participant or beneficiary.
IRS means the Internal Revenue Service.
Mandatory employee contributions means amounts contributed to the
plan by a participant that are required as a condition of employment,
as a condition of participation in such plan, or as a condition of
obtaining benefits under the plan attributable to employer
contributions.
Mass withdrawal means the withdrawal of every employer from the
plan, or the withdrawal of substantially all employers pursuant to an
agreement or arrangement to withdraw.
Multiemployer Act means the Multiemployer Pension Plan Amendments
Act of 1980.
Multiemployer plan means a plan that is described in section
4001(a)(3) of ERISA and that is covered by title IV of ERISA.
Multiple employer plan means a single-employer plan maintained by
two or more contributing sponsors that are not members of the same
controlled group, under which all plan assets are available to pay
benefits to all plan participants and beneficiaries.
Nonbasic-type benefit means any benefit provided by a plan other
than a basic-type benefit.
Nonforfeitable benefit means a benefit described in section
4001(a)(8) of ERISA. Benefits that become nonforfeitable solely as a
result of the termination of a plan will be considered forfeitable.
Normal retirement age means the age specified in the plan as the
normal retirement age. This age shall not exceed the later of age 65 or
the age attained after 5 years of participation in the plan. If no
normal retirement age is specified in the plan, it is age 65.
Notice of intent to terminate means the notice of a proposed
termination of a single-employer plan, as required by section
4041(a)(2) of ERISA and Sec. 4041.21 (in a standard termination) or
Sec. 4041.41 (in a distress termination) of this chapter.
PBGC means the Pension Benefit Guaranty Corporation.
Person means a person defined in section 3(9) of ERISA.
Plan means a defined benefit plan within the meaning of section
3(35) of ERISA that is covered by title IV of ERISA.
Plan administrator means an administrator, as defined in section
3(16)(A) of ERISA.
Plan sponsor means, with respect to a multiemployer plan, the
person described in section 4001(a)(10) of ERISA.
Plan year means the calendar, policy, or fiscal year on which the
records of the plan are kept.
Proposed termination date means the date specified as such by the
plan administrator of a single-employer plan in a notice of intent to
terminate or, if later, in the standard or distress termination notice,
in accordance with section 4041 of ERISA and part 4041 of this chapter.
Single-employer plan means any defined benefit plan (as defined in
section 3(35) of ERISA) that is not a multiemployer plan (as defined in
section 4001(a)(3) of ERISA) and that is covered by title IV of ERISA.
Standard termination means the voluntary termination, in accordance
with section 4041(b) of ERISA and part 4041, subpart B, of this
chapter, of a single-employer plan that is able to provide for all of
its benefit liabilities when plan assets are distributed.
Substantial owner means a substantial owner as defined in section
4022(b)(5)(A) of ERISA.
Sufficient for benefit liabilities means that there is no amount of
unfunded benefit liabilities, as defined in section 4001(a)(18) of
ERISA.
Sufficient for guaranteed benefits means that there is no amount of
unfunded guaranteed benefits, as defined in section 4001(a)(17) of
ERISA.
Termination date means the date established pursuant to section
4048(a) of ERISA.
Title IV benefit means the guaranteed benefit plus any additional
benefits to which plan assets are allocated pursuant to section 4044 of
ERISA and part 4044 of this chapter.
Voluntary employee contributions means amounts contributed by an
employee to a plan, pursuant to the provisions of the plan, that are
not mandatory employee contributions.
Sec. 4001.3 Trades or businesses under common control; controlled
groups.
For purposes of title IV of ERISA:
(a)(1) The PBGC will determine that trades and businesses (whether
or not incorporated) are under common control if they are ``two or more
trades or businesses under common control'', as defined in regulations
prescribed under section 414(c) of the Code.
(2) The PBGC will determine that all employees of trades or
businesses (whether or not incorporated) which are under common control
shall be treated as employed by a single employer, and all such trades
and businesses shall be treated as a single employer.
(3) An individual who owns the entire interest in an unincorporated
trade or business is treated as his own employer, and a partnership is
treated as the employer of each partner who is an employee within the
meaning of section 401(c)(1) of the Code.
(b) In the case of a single-employer plan:
(1) In connection with any person, a controlled group consists of
that person and all other persons under common control with such
person.
(2) Persons are under common control if they are members of a
``controlled group of corporations'', as defined in regulations
prescribed under section 414(b) of the Code, or if they are ``two or
more trades or businesses under common control'', as defined in
regulations prescribed under section 414(c) of the Code.
PART 4002--BYLAWS OF THE PENSION BENEFIT GUARANTY CORPORATION
Sec.
4002.1 Name.
4002.2 Offices.
4002.3 Board of Directors.
4002.4 Chairman.
4002.5 Quorum.
[[Page 34012]]
4002.6 Meetings.
4002.7 Place of meetings; use of conference call communications
equipment.
4002.8 Alternate voting procedure.
4002.9 Amendments.
Authority: 29 U.S.C. 1302(f).
Sec. 4002.1 Name.
The name of the Corporation is the Pension Benefit Guaranty
Corporation.
Sec. 4002.2 Offices.
The principal office of the Corporation shall be in the
Metropolitan area of the City of Washington, District of Columbia. The
Corporation may have additional offices at such other places as the
Board of Directors may deem necessary or desirable to the conduct of
its business.
Sec. 4002.3 Board of Directors.
(a) The Board of Directors shall establish the policies of the
Corporation and shall perform the other functions assigned to the Board
of Directors in title IV of the Employee Retirement Income Security Act
of 1974. The Board of Directors of the Corporation shall be composed of
the Secretary of Labor, the Secretary of the Treasury, and the
Secretary of Commerce. Members of the Board shall serve without
compensation, but shall be reimbursed by the Corporation for travel,
subsistence, and other necessary expenses incurred in the performance
of their duties as members of the Board. A person at the time of a
meeting of the Board of Directors who is serving as Secretary of Labor,
Secretary of the Treasury or Secretary of Commerce in an acting
capacity, shall serve as a member of the Board of Directors with the
same authority and effect as the designated Secretary.
(b) The following powers are expressly reserved to the Board of
Directors and shall not be delegated:
(1) Approval of all final substantive regulations prior to
publication in the Federal Register, except for amendments to the
regulations on Allocation of Assets in Single-employer Plans and Duties
of Plan Sponsor Following Mass Withdrawal (parts 4044 and 4281 of this
chapter) establishing new interest rates and factors, which may be
approved by the Executive Director of the PBGC.
(2) Approval of all reports or recommendations to the Congress that
are required by statute;
(3) Establishment from time to time of the Corporation's budget and
debt ceiling up to the statutory limit;
(4) Determination from time to time of limits on advances to the
revolving funds administered by the Corporation pursuant to section
4005(a) of ERISA;
(5) Final decision on any policy matter that would materially
affect the rights of a substantial number of employers or covered
participants and beneficiaries.
(c) Final non-substantive regulations and all proposed regulations
shall be approved by the Executive Director prior to publication in the
Federal Register; provided that all proposed substantive regulations
shall first be circulated for review to the Board of Directors or their
designees, and may thereafter be issued by the Executive Director after
responding to any comments made within 21 days after circulation of the
proposed regulation, or, if no comments are received, after expiration
of the 21-day period.
Sec. 4002.4 Chairman.
The Secretary of Labor shall be the Chairman of the Board of
Directors and he shall be the administrator of the Corporation with
responsibility for its management, including overall supervision of the
Corporation's personnel, organization, and budget practices, and shall
exercise such incidental powers as may be necessary to carry out his
administrative responsibilities. The Chairman may delegate his
administrative responsibilities.
Sec. 4002.5 Quorum.
A majority of the Directors shall constitute a quorum for the
transaction of business. Any act of a majority of the Directors present
at any meeting at which there is a quorum shall be the act of the
Board, except as may otherwise be provided in these bylaws.
Sec. 4002.6 Meetings.
Regular meetings of the Board of Directors shall be held at such
times as the Chairman shall select. Special meetings of the Board of
Directors shall be called by the Chairman on the request of any other
Director. Reasonable notice of any meetings shall be given to each
Director. The General Counsel of the Corporation shall serve as
Secretary to the Board of Directors and keep its minutes. As soon as
practicable after each meeting, a draft of the minutes of such meeting
shall be distributed to each member of the Board for correction or
approval.
Sec. 4002.7 Place of meetings; use of conference call communications
equipment.
Meetings of the Board of Directors shall be held at the principal
office of the Corporation unless otherwise determined by the Board of
Directors or the Chairman. Any Director may participate in a meeting of
the Board of Directors through the use of conference call telephone or
similar communications equipment, by means of which all persons
participating in the meeting can simultaneously speak to and hear each
other. Any Director so participating in a meeting shall be deemed
present for all purposes. Actions taken by the Board of Directors at
meetings conducted through the use of such equipment, including the
votes of each member, shall be recorded in the usual manner in the
minutes of the meetings of the Board of Directors. A resolution of the
Board of Directors signed by each of its three members shall have the
same force and effect as if agreed at a duly called meeting and shall
be recorded in the minutes of the Board of Directors.
Sec. 4002.8 Alternate voting procedure.
(a) A Director shall be deemed to have participated in a meeting of
the Board of Directors for all purposes if,
(1) That Director was represented at that meeting by an individual
who was designated to act on his behalf, and
(2) That Director ratified in writing the actions taken by his
designee at that meeting within a reasonable period of time after such
meeting.
(b) For purposes of this section, a Director, including an
individual serving as Acting Secretary, shall designate a
representative at a level not below that of Assistant Secretary within
his Department. Such designation shall be in writing and shall be
effective until withdrawn or until a date specified therein.
(c) For purposes of this section, a Director's approval of the
minutes of a meeting of the Board of Directors shall constitute
ratification of the actions of his designee at such meeting.
Sec. 4002.9 Amendments.
These bylaws may be amended or new bylaws adopted by unanimous vote
of the Board.
PART 4003--RULES FOR ADMINISTRATIVE REVIEW OF AGENCY DECISIONS
Subpart A--General Provisions
Sec.
4003.1 Purpose and scope.
4003.2 Definitions.
4003.3 PBGC assistance in obtaining information.
4003.4 Extension of time.
4003.5 Non-timely request for review.
4003.6 Representation.
4003.7 Exhaustion of administrative remedies.
4003.8 Request for confidential treatment.
4003.9 Filing of documents.
4003.10 Computation of time.
[[Page 34013]]
Subpart B--Initial Determinations
4003.21 Form and contents of initial determinations.
4003.22 Effective date of determinations.
Subpart C--Reconsideration of Initial Determinations
4003.31 Who may request reconsideration.
4003.32 When to request reconsideration.
4003.33 Where to submit request for reconsideration.
4003.34 Form and contents of request for reconsideration.
4003.35 Final decision on request for reconsideration.
Subpart D--Administrative Appeals
4003.51 Who may appeal or participate in appeals.
4003.52 When to file.
4003.53 Where to file.
4003.54 Contents of appeal.
4003.55 Opportunity to appear and to present witnesses.
4003.56 Consolidation of appeals.
4003.57 Appeals affecting third parties.
4003.58 Powers of the Appeals Board.
4003.59 Decision by the Appeals Board.
4003.60 Referral of appeal to the Executive Director.
Authority: 29 U.S.C. 1302(b)(3).
Subpart A--General Provisions
Sec. 4003.1 Purpose and scope.
(a) Purpose. This part sets forth the rules governing the issuance
of all initial determinations by the PBGC on cases pending before it
involving the matters set forth in paragraph (b) of this section and
the procedures for requesting and obtaining administrative review by
the PBGC of those determinations. Subpart A contains general
provisions. Subpart B sets forth rules governing the issuance of all
initial determinations of the PBGC on matters covered by this part.
Subpart C establishes procedures governing the reconsideration by the
PBGC of initial determinations relating to the matters set forth in
paragraphs (b)(1) through (b)(4). Subpart D establishes procedures
governing administrative appeals from initial determinations relating
to the matters set forth in paragraphs (b)(5) through (b)(10).
(b) Scope. This part applies to the following determinations made
by the PBGC in cases pending before it and to the review of those
determinations:
(1) Determinations that a plan is covered under section 4021 of
ERISA;
(2) Determinations with respect to premiums, interest and late
payment penalties pursuant to section 4007 of ERISA;
(3) Determinations with respect to voluntary terminations under
section 4041 of ERISA, including--
(i) A determination that a notice requirement or a certification
requirement under section 4041 of ERISA has not been met,
(ii) A determination that the requirements for demonstrating
distress under section 4041(c)(2)(B) of ERISA have not been met, and
(iii) A determination with respect to the sufficiency of plan
assets for benefit liabilities or for guaranteed benefits;
(4) Determinations with respect to allocation of assets under
section 4044 of ERISA, including distribution of excess assets under
section 4044(d);
(5) Determinations that a plan is not covered under section 4021 of
ERISA;
(6) Determinations under section 4022 (a) or (c) or section
4022A(a) of ERISA with respect to benefit entitlement of participants
and beneficiaries under covered plans and determinations that a
domestic relations order is or is not a qualified domestic relations
order under section 206(d)(3) of ERISA and section 414(p) of the Code;
(7) Determinations under section 4022 (b) or (c), section 4022A (b)
through (e), or section 4022B of ERISA of the amount of benefits
payable to participants and beneficiaries under covered plans;
(8) Determinations of the amount of money subject to recapture
pursuant to section 4045 of ERISA;
(9) Determinations of the amount of liability under section
4062(b)(1), section 4063, or section 4064 of ERISA;
(10) Determinations--
(i) That the amount of a participant's or beneficiary's benefit
under section 4050(a)(3) of ERISA has been correctly computed based on
the designated benefit paid to the PBGC under section 4050(b)(2) of
ERISA, or
(ii) That the designated benefit is correct, but only to the extent
that the benefit to be paid does not exceed the participant's or
beneficiary's guaranteed benefit.
(c) Matters not covered by this part. Nothing in this part limits--
(1) The authority of the PBGC to review, either upon request or on
its own initiative, a determination to which this part does not apply
when, in its discretion, the PBGC determines that it would be
appropriate to do so, or
(2) The procedure that the PBGC may utilize in reviewing any
determination to which this part does not apply.
Sec. 4003.2 Definitions.
The following terms are defined in Sec. 4001.2 of this chapter:
Code, contributing sponsor, controlled group, ERISA, multiemployer
plan, PBGC, person, plan administrator, and single-employer plan.
In addition, for purposes of this part:
Aggrieved person means any participant, beneficiary, plan
administrator, contributing sponsor of a single-employer plan or member
of such a contributing sponsor's controlled group, plan sponsor of a
multiemployer plan, or employer that is adversely affected by an
initial determination of the PBGC with respect to a pension plan in
which such person has an interest. The term ``beneficiary'' includes an
alternate payee (within the meaning of section 206(d)(3)(K) of ERISA)
under a qualified domestic relations order (within the meaning of
section 206(d)(3)(B) of ERISA).
Appeals Board means a board consisting of three PBGC officials. The
Executive Director shall appoint a senior PBGC official to serve as
Chairperson and three or more other PBGC officials to serve as regular
Appeals Board members. The Chairperson shall designate the three
officials who will constitute the Appeals Board with respect to a case,
provided that a person may not serve on the Appeals Board with respect
to a case in which he or she made a decision regarding the merits of
the determination being appealed. The Chairperson need not serve on the
Appeals Board with respect to all cases.
Appellant means any person filing an appeal under subpart D of this
part.
Director means the Director of any department of the PBGC and
includes the Executive Director of the PBGC, Deputy Executive
Directors, and the General Counsel.
Sec. 4003.3 PBGC assistance in obtaining information.
A person who lacks information or documents necessary to file a
request for review pursuant to subpart C or D of this part, or
necessary to a decision whether to seek review, or necessary to
participate in an appeal pursuant to Sec. 4003.57 of this part or
necessary to a decision whether to participate, may request the PBGC's
assistance in obtaining information or documents in the possession of a
party other than the PBGC. The request shall state or describe the
missing information or documents, the reason why the person needs the
information or documents, and the reason why the person needs the
assistance of the PBGC in obtaining the information or documents. The
request may also include a request for an extension of time to file
pursuant to Sec. 4003.4 of this part.
Sec. 4003.4 Extension of time.
(a) General rule. When a document is required under this part to be
filed within a prescribed period of time, an extension of time to file
will be granted only upon good cause shown and only
[[Page 34014]]
when the request for an extension is made before the expiration of the
time prescribed. The request for an extension shall be in writing and
state why additional time is needed and the amount of additional time
requested. The filing of a request for an extension shall stop the
running of the prescribed period of time. When a request for an
extension is granted, the PBGC shall notify the person requesting the
extension, in writing, of the amount of additional time granted. When a
request for an extension is denied, the PBGC shall so notify the
requestor in writing, and the prescribed period of time shall resume
running from the date of denial.
(b) Disaster relief. When the President of the United States
declares that, under the Disaster Relief Act of 1974, as amended (42
U.S.C. 5121, 5122(2), 5141(b)), a major disaster exists, the Executive
Director of the PBGC (or his or her designee) may, by issuing one or
more notices of disaster relief, extend the due date for filing a
request for reconsideration under Sec. 4003.32 or an appeal under
Sec. 4003.52 by up to 180 days.
(1) The due date extension or extensions shall be available only to
an aggrieved person who is residing in, or whose principal place of
business is within, a designated disaster area, or with respect to whom
the office of the service provider, bank, insurance company, or other
person maintaining the information necessary to file the request for
reconsideration or appeal is within a designated disaster area; and
(2) The request for reconsideration or appeal shall identify the
filing as one for which the due date extension is available.
Sec. 4003.5 Non-timely request for review.
The PBGC will process a request for review of an initial
determination that was not filed within the prescribed period of time
for requesting review (see Secs. 4003.32 and 4003.52) if--
(a) The person requesting review demonstrates in his or her request
that he or she did not file a timely request for review because he or
she neither knew nor, with due diligence, could have known of the
initial determination; and
(b) The request for review is filed within 30 days after the date
the aggrieved person, exercising due diligence at all relevant times,
first learned of the initial determination where the requested review
is reconsideration, or within 45 days after the date the aggrieved
person, exercising due diligence at all relevant times, first learned
of the initial determination where the request for review is an appeal.
Sec. 4003.6 Representation.
A person may file any document or make any appearance that is
required or permitted by this part on his or her own behalf or he or
she may designate a representative. When the representative is not an
attorney-at-law, a notarized power of attorney, signed by the person
making the designation, which authorizes the representation and
specifies the scope of representation shall be filed with the PBGC in
accordance with Sec. 4003.9(b) of this part.
Sec. 4003.7 Exhaustion of administrative remedies.
Except as provided in Sec. 4003.22(b), a person aggrieved by an
initial determination of the PBGC covered by this part, other than a
determination subject to reconsideration that is issued by a Department
Director, has not exhausted his or her administrative remedies until he
or she has filed a request for reconsideration under subpart C of this
part or an appeal under subpart D of this part, whichever is
applicable, and a decision granting or denying the relief requested has
been issued.
Sec. 4003.8 Request for confidential treatment.
If any person filing a document with the PBGC believes that some or
all of the information contained in the document is exempt from the
mandatory public disclosure requirements of the Freedom of Information
Act, 5 U.S.C. 552, he or she shall specify the information with respect
to which confidentiality is claimed and the grounds therefor.
Sec. 4003.9 Filing of documents.
(a) Date of filing. Any document required or permitted to be filed
under this part is considered filed on the date of the United States
postmark stamped on the cover in which the document is mailed, provided
that--
(1) The postmark was made by the United States Postal Service; and
(2) The document was mailed postage prepaid, properly packaged and
addressed to the PBGC.
If the conditions stated in both paragraphs (a)(1) and (a)(2) of
this section are not met, the document is considered filed on the date
it is received by the PBGC. Documents received after regular business
hours are considered filed on the next regular business day.
(b) Where to file. Any document required or permitted to be filed
under this part in connection with a request for reconsideration shall
be submitted to the Director of the department within the PBGC that
issued the initial determination. Any document required or permitted to
be filed under this part in connection with an appeal shall be
submitted to the Appeals Board, Pension Benefit Guaranty Corporation,
1200 K Street NW., Washington, DC 20005-4026.
Sec. 4003.10 Computation of time.
In computing any period of time prescribed or allowed by this part,
the day of the act, event, or default from which the designated period
of time begins to run is not counted. The last day of the period so
computed shall be included, unless it is a Saturday, Sunday, or Federal
holiday, in which event the period runs until the end of the next day
which is not a Saturday, Sunday, or a Federal holiday.
Subpart B--Initial Determinations
Sec. 4003.21 Form and contents of initial determinations.
All determinations to which this subpart applies shall be in
writing, shall state the reason for the determination, and, except when
effective on the date of issuance as provided in Sec. 4003.22(b), shall
contain notice of the right to request review of the determination
pursuant to subpart C or subpart D of this part, as applicable, and a
brief description of the procedures for requesting review.
Sec. 4003.22 Effective date of determinations.
(a) General Rule. Except as provided in paragraph (b) of this
section, an initial determination covered by this subpart will not
become effective until the prescribed period of time for filing a
request for reconsideration under subpart C of this part or an appeal
under subpart D of this part, whichever is applicable, has elapsed. The
filing of a request for review under subpart C or D of this part shall
automatically stay the effectiveness of a determination until a
decision on the request for review has been issued by the PBGC.
(b) Exception. The PBGC may, in its discretion, order that the
initial determination in a case is effective on the date it is issued.
When the PBGC makes such an order, the initial determination shall
state that the determination is effective on the date of issuance and
that there is no obligation to exhaust administrative remedies with
respect to that determination by seeking review of it by the PBGC.
[[Page 34015]]
Subpart C--Reconsideration of Initial Determinations
Sec. 4003.31 Who may request reconsideration.
Any person aggrieved by an initial determination of the PBGC to
which this subpart applies may request reconsideration of the
determination.
Sec. 4003.32 When to request reconsideration.
Except as provided in Secs. 4003.4 and 4003.5, a request for
reconsideration must be filed within 30 days after the date of the
initial determination of which reconsideration is sought or, when
administrative review includes a procedure in Sec. 4903.33 of this
chapter, by a date 60 days (or more) thereafter that is specified in
the PBGC's notice of the right to request review.
Sec. 4003.33 Where to submit request for reconsideration.
A request for reconsideration shall be submitted to the Director of
the department within the PBGC that issued the initial determination,
except that a request for reconsideration of a determination described
in Sec. 4003.1(b)(3)(ii) shall be submitted to the Executive Director.
Sec. 4003.34 Form and contents of request for reconsideration.
A request for reconsideration shall--
(a) Be in writing;
(b) Be clearly designated as a request for reconsideration;
(c) Contain a statement of the grounds for reconsideration and the
relief sought; and
(d) Reference all pertinent information already in the possession
of the PBGC and include any additional information believed to be
relevant.
Sec. 4003.35 Final decision on request for reconsideration.
(a) Except as provided in paragraphs (a)(1) or (a)(2), final
decisions on requests for reconsideration will be issued by the same
department of the PBGC that issued the initial determination, by an
official whose level of authority in that department is higher than
that of the person who issued the initial determination.
(1) When an initial determination is issued by a Department
Director, the Department Director (or an official designated by the
Department Director) will issue the final decision on request for
reconsideration of a determination other than one described in
Sec. 4003.1(b)(3)(ii).
(2) The Executive Director (or an official designated by the
Executive Director) will issue the final decision on a request for
reconsideration of a determination described in Sec. 4003.1(b)(3)(ii).
(b) The final decision on a request for reconsideration shall be in
writing, specify the relief granted, if any, state the reason(s) for
the decision, and state that the person has exhausted his or her
administrative remedies.
Subpart D--Administrative Appeals
Sec. 4003.51 Who may appeal or participate in appeals.
Any person aggrieved by an initial determination to which this
subpart applies may file an appeal. Any person who may be aggrieved by
a decision under this subpart granting the relief requested in whole or
in part may participate in the appeal in the manner provided in
Sec. 4003.57.
Sec. 4003.52 When to file.
Except as provided in Secs. 4003.4 and 4003.5, an appeal under this
subpart must be filed within 45 days after the date of the initial
determination being appealed or, when administrative review includes a
procedure in Sec. 4903.33 of this chapter, by a date 60 days (or more)
thereafter that is specified in the PBGC's notice of the right to
request review.
Sec. 4003.53 Where to file.
An appeal or a request for an extension of time to appeal shall be
submitted to the Appeals Board, Pension Benefit Guaranty Corporation,
1200 K Street NW., Washington, DC 20005-4026.
Sec. 4003.54 Contents of appeal.
(a) An appeal shall--
(1) Be in writing;
(2) Be clearly designated as an appeal;
(3) Contain a statement of the grounds upon which it is brought and
the relief sought;
(4) Reference all pertinent information already in the possession
of the PBGC and include any additional information believed to be
relevant;
(5) State whether the appellant desires to appear in person or
through a representative before the Appeals Board; and
(6) State whether the appellant desires to present witnesses to
testify before the Appeals Board, and if so, state why the presence of
witnesses will further the decision-making process.
(b) In any case where the appellant believes that another person
may be aggrieved if the PBGC grants the relief sought, the appeal shall
also include the name(s) and address(es) (if known) of such other
person(s).
Sec. 4003.55 Opportunity to appear and to present witnesses.
(a) At the discretion of the Appeals Board, any appearance
permitted under this subpart may be before a hearing officer designated
by the Appeals Board.
(b) An opportunity to appear before the Appeals Board (or a hearing
officer) and an opportunity to present witnesses will be permitted at
the discretion of the Appeals Board. In general, an opportunity to
appear will be permitted if the Appeals Board determines that there is
a dispute as to a material fact; an opportunity to present witnesses
will be permitted when the Appeals Board determines that witnesses will
contribute to the resolution of a factual dispute.
(c) Appearances permitted under this section will take place at the
main offices of the PBGC, 1200 K Street NW., Washington, DC 20005-4026,
unless the Appeals Board, in its discretion, designates a different
location, either on its own initiative or at the request of the
appellant or a third party participating in the appeal.
Sec. 4003.56 Consolidation of appeals.
(a) When consolidation may be required. Whenever multiple appeals
are filed that arise out of the same or similar facts and seek the same
or similar relief, the Appeals Board may, in its discretion, order the
consolidation of all or some of the appeals.
(b) Representation of parties. Whenever the Appeals Board orders
the consolidation of appeals, the appellants may designate one (or
more) of their number to represent all of them for all purposes
relating to their appeals.
(c) Decision by Appeals Board. The decision of the Appeals Board in
a consolidated appeal shall be binding on all appellants whose appeals
were subject to the consolidation.
Sec. 4003.57 Appeals affecting third parties.
(a) Before the Appeals Board issues a decision granting, in whole
or in part, the relief requested in an appeal, it shall make a
reasonable effort to notify third persons who will be aggrieved by the
decision of the following:
(1) The pendency of the appeal;
(2) The grounds upon which the appeal is based;
(3) The grounds upon which the Appeals Board is considering
reversing the initial determination;
(4) The right to submit written comments on the appeal;
(5) The right to request an opportunity to appear in person or
through a representative before the Appeals Board and to present
witnesses; and
(6) That no further opportunity to present information to the PBGC
with
[[Page 34016]]
respect to the determination under appeal will be provided.
(b) Written comments and a request to appear before the Appeals
Board must be filed within 45 days after the date of the notice from
the Appeals Board.
(c) If more than one third party is involved, their participation
in the appeal may be consolidated pursuant to the provisions of
Sec. 4003.56.
Sec. 4003.58 Powers of the Appeals Board.
In addition to the powers specifically described in this part, the
Appeals Board may request the submission of any information or the
appearance of any person it considers necessary to resolve a matter
before it and to enter any order it considers necessary for or
appropriate to the disposition of any matter before it.
Sec. 4003.59 Decision by the Appeals Board.
(a) In reaching its decision, the Appeals Board shall consider
those portions of the file relating to the initial determination, all
material submitted by the appellant and any third parties in connection
with the appeal, and any additional information submitted by PBGC
staff.
(b) The decision of the Appeals Board constitutes the final agency
action by the PBGC with respect to the determination which was the
subject of the appeal and is binding on all parties who participated in
the appeal and who were notified pursuant to Sec. 4003.57 of their
right to participate in the appeal.
(c) The decision of the Appeals Board shall be in writing, specify
the relief granted, if any, state the bases for the decision, including
a brief statement of the facts or legal conclusions supporting the
decision, and state that the appellant has exhausted his or her
administrative remedies.
Sec. 4003.60 Referral of appeal to the Executive Director.
The Appeals Board may, in its discretion, refer any appeal to the
Executive Director of the PBGC for decision. In such a case, the
Executive Director shall have all the powers vested in the Appeals
Board by this subpart and the decision of the Executive Director shall
meet the requirements of and have the effect of a decision issued under
Sec. 4003.59 of this part.
PART 4006--PREMIUM RATES
Sec.
4006.1 Purpose and scope.
4006.2 Definitions.
4006.3 Premium rate.
4006.4 Determination of unfunded vested benefits.
4006.5 Exemptions and special rules.
Authority: 29 U.S.C. 1302(b)(3), 1306, 1307.
Sec. 4006.1 Purpose and scope.
This part, which applies to all plans covered by title IV of ERISA,
provides rules for computing the premiums imposed by sections 4006 and
4007 of ERISA. (See part 4007 of this chapter for rules for the payment
of premiums, including due dates and late payment charges.)
Sec. 4006.2 Definitions.
The following terms are defined in Sec. 4001.2 of this chapter:
Code, contributing sponsor, ERISA, fair market value, insurer,
irrevocable commitment, multiemployer plan, notice of intent to
terminate, PBGC, plan administrator, plan, plan year, and single-
employer plan.
In addition, for purposes of this part:
New plan means a plan that became effective within the premium
payment year and includes a plan resulting from a consolidation or
spinoff. A plan that meets this definition is considered to be a new
plan even if the plan constitutes a successor plan within the meaning
of section 4021(a) of ERISA.
Newly-covered plan means a plan that is not a new plan and that was
not covered by title IV of ERISA immediately prior to the premium
payment year.
Participant means any individual who is included in one of the
categories below:
(a) Active. (1) Any individual who is currently in employment
covered by the plan and who is earning or retaining credited service
under the plan. This category includes any individual who is considered
covered under the plan for purposes of meeting the minimum coverage
requirements, but because of offset or other provisions (including
integration with Social Security benefits), the individual does not
have any accrued benefits.
(2) Any non-vested individual who is not currently in employment
covered by the plan but who is earning or retaining credited service
under the plan. This category does not include a non-vested former
employee who has incurred a break in service the greater of one year or
the break in service period specified in the plan.
(b) Inactive--(1) Inactive receiving benefits. Any individual who
is retired or separated from employment covered by the plan and who is
receiving benefits under the plan. This category does not include an
individual to whom an insurer has made an irrevocable commitment to pay
all the benefits to which the individual is entitled under the plan.
(2) Inactive entitled to future benefits. Any individual who is
retired or separated from employment covered by the plan and who is
entitled to begin receiving benefits under the plan in the future. This
category does not include an individual to whom an insurer has made an
irrevocable commitment to pay all the benefits to which the individual
is entitled under the plan.
(c) Deceased. Any deceased individual who has one or more
beneficiaries who are receiving or entitled to receive benefits under
the plan. This category does not include an individual if an insurer
has made an irrevocable commitment to pay all the benefits to which the
beneficiaries of that individual are entitled under the plan.
Premium payment year means the plan year for which the premium is
being paid.
Short plan year means a plan year that is less than twelve full
months.
Sec. 4006.3 Premium rate.
Subject to the provisions of Sec. 4006.5 (dealing with exemptions
and special rules), the premium paid for basic benefits guaranteed
under section 4022(a) of ERISA shall equal the flat-rate premium under
paragraph (a) of this section plus, in the case of a single-employer
plan, the variable-rate premium under paragraph (b) of this section.
(a) Flat-rate premium. The flat-rate premium is equal to the number
of participants in the plan on the last day of the plan year preceding
the premium payment year, multiplied by--
(1) $19 for a single-employer plan, or
(2) $2.60 for a multiemployer plan.
(b) Variable-rate premium. The variable-rate premium is $9 for each
$1,000 of a single-employer plan's unfunded vested benefits, as
determined under Sec. 4006.4.
Sec. 4006.4 Determination of unfunded vested benefits.
(a) General rule. Except as permitted by paragraph (c) of this
section or as provided in the exemptions and special rules under
Sec. 4006.5, the amount of a plan's unfunded vested benefits (as
defined in paragraph (b) of this section) shall be determined as of the
last day of the plan year preceding the premium payment year, based on
the plan provisions and the plan's population as of that date. The
determination shall be made in accordance with paragraph (a)(1) or
(a)(2), and shall be certified to in accordance with paragraph (a)(4).
(1) The unfunded vested benefits shall be determined using the
actuarial assumptions and methods described in
[[Page 34017]]
paragraph (a)(3) for the plan year preceding the premium payment year
(or, in the case of a new or newly-covered plan, for the premium
payment year), except to the extent that other actuarial assumptions or
methods are specifically prescribed by this section or are necessary to
reflect the occurrence of a significant event described in paragraph
(d) of this section between the date of the funding valuation and the
last day of the plan year preceding the premium payment year. (If the
plan does a valuation as of the last day of the plan year preceding the
premium payment year, no separate adjustment for significant events is
needed.)
(2) Under this rule, the determination of the unfunded vested
benefits may be based on a plan valuation done as of the first day of
the premium payment year, provided that--
(i) The actuarial assumptions and methods used are those described
in paragraph (a)(3) for the premium payment year, except to the extent
that other actuarial assumptions or methods are specifically prescribed
by this section or are required to make the adjustment described in
paragraph (a)(2)(ii) of this section; and
(ii) If an enrolled actuary determines that there is a material
difference between the values determined under the valuation and the
values that would have been determined as of the last day of the
preceding plan year, the valuation results are adjusted to reflect
appropriately the values as of the last day of the preceding plan year.
(This adjustment need not be made if the unadjusted valuation would
result in greater unfunded vested benefits.)
(3) For purposes of paragraphs (a)(1) and (a)(2), the actuarial
assumptions and methods for a plan year are those used by the plan for
purposes of determining the additional funding requirement under
section 302(d) of ERISA and section 412(1) of the Code (or, in the case
of a plan that is not required to determine such additional funding
requirement, any assumptions and methods that would be permitted for
such purpose if the plan were so required).
(4) In the case of any plan that determines the amount of its
unfunded vested benefits under the general rule described in this
paragraph, an enrolled actuary must certify, in accordance with the
PBGC annual Premium Payment Package provided for in Sec. 4007.3 of this
part, that the determination was made in a manner consistent with
generally accepted actuarial principles and practices.
(b) Unfunded vested benefits. The amount of a plan's unfunded
vested benefits under this section shall be the excess of the plan's
vested benefits amount (determined under paragraph (b)(1) of this
section) over the value of the plan's assets (determined under
paragraph (b)(2) of this section).
(1) Vested benefits amount. A plan's vested benefits amount under
this section shall be the plan's current liability (within the meaning
of section 302(d)(7) of ERISA and section 412(1)(7) of the Code)
determined by taking into account only vested benefits and by using an
interest rate equal to the applicable percentage of the annual yield
for 30-year Treasury constant maturities, as reported in Federal
Reserve Statistical Release G.13 and H.15, for the calendar month
preceding the calendar month in which the premium payment year begins.
If the interest rate (or rates) used by the plan to determine current
liability was (or were all) not greater than the required interest
rate, the vested benefits need not be revalued if an enrolled actuary
certifies that the interest rate (or interest rates) used was (or were
all) not greater than the required interest rate. For purposes of this
paragraph (b)(1) (subject to the provisions of Sec. 4006.5(g), dealing
with plans of regulated public utilities), the applicable percentage
is--
(i) For a premium payment year that begins before July 1997, 80
percent;
(ii) For a premium payment year that begins after June 1997 and
before the first premium payment year to which the first tables
prescribed under section 302(d)(7)(C)(ii)(II) of ERISA and section
412(1)(7)(C)(ii)(II) of the Code apply, 85 percent; and
(iii) For the first premium payment year to which the first tables
prescribed under section 302(d)(7)(C)(ii)(II) of ERISA and section
412(1)(7)(C)(ii)(II) of the Code apply and any subsequent plan year,
100 percent.
(2) Value of assets. (i) Actuarial value. For a premium payment
year that is described in paragraph (b)(1)(i) or (b)(1)(ii) of this
section, the value of the plan's assets shall be their actuarial value
determined in accordance with section 302(c)(2) of ERISA and section
412(c)(2) of the Code.
(ii) Fair market value. For a premium payment year that is
described in paragraph (b)(1)(iii) of this section, the value of the
plan's assets shall be their fair market value.
(iii) Use of credit balance. The value of the plan's assets shall
not be reduced by a credit balance in the funding standard account.
(iv) Contributions. Contributions owed for any plan year preceding
the premium payment year shall be included for plans with 500 or more
participants and may be included for any other plan. Contributions may
be included only to the extent such contributions have been paid into
the plan on or before the earlier of the due date for payment of the
variable-rate portion of the premium under Sec. 4007.11 or the date
that portion is paid. Contributions included that are paid after the
last day of the plan year preceding the premium payment year shall be
discounted at the plan asset valuation rate (on a simple or compound
basis in accordance with the plan's discounting rules) to such last day
to reflect the date(s) of payment. Contributions for the premium
payment year may not be included for any plan.
(c) Alternative method for calculating unfunded vested benefits. In
lieu of determining the amount of the plan's unfunded vested benefits
pursuant to paragraph (a) of this section, a plan administrator may
calculate the amount of a plan's unfunded vested benefits under this
paragraph (c) using the plan's Form 5500, Schedule B, for the plan year
preceding the premium payment year. Pursuant to this paragraph (c),
unfunded vested benefits shall be determined, in accordance with the
Premium Payment Package, from values for the plan's vested benefits and
assets that are required to be reported on the plan's Schedule B. The
value of the vested benefits shall be adjusted in accordance with
paragraph (c)(1) of this section to reflect accruals during the plan
year preceding the premium payment year and with paragraph (c)(2) of
this section to reflect the interest rate prescribed in paragraph
(b)(1) of this section, and the value of the assets shall be adjusted
in accordance with paragraph (c)(4) of this section. (If the plan
administrator certifies that the interest rate (or rates) used to
determine the vested benefit values taken from the Schedule B was (or
were all) not greater than the interest rate prescribed in paragraph
(b)(1) of this section, the interest rate adjustment prescribed in
paragraph (c)(2) of this section is not required.) The resulting
unfunded vested benefits amount shall be adjusted in accordance with
paragraph (c)(5) of this section to reflect the passage of time from
the date of the Schedule B data to the last day of the plan year
preceding the premium payment year.
(1) Vested benefits adjustment for accruals. The total value of the
plan's current liability as of the first day of the plan year preceding
the premium payment year for vested benefits of active and terminated
vested participants not in pay status, computed in accordance with
section 302(d)(7) of ERISA and section 412(l)(7) of the Code,
[[Page 34018]]
shall be adjusted to reflect the increase in vested benefits
attributable to accruals during the plan year preceding the premium
payment year by multiplying that value by 1.07.
(2) Vested benefits interest rate adjustment. The value of vested
benefits as entered on the Schedule B shall be adjusted in accordance
with the following formula (except as provided in paragraph (c)(3) of
this section) to reflect the interest rate prescribed in paragraph
(b)(1) of this section:
VBadj=VBPAY x .94(RIR-BIR)+VBNON-PAY
x .94(RIR-BIR) x ((100+BIA)/(100+RIR))(ARA-50);
where--
(i) VBadj is the adjusted vested benefits amount (as of the
first day of the plan year preceding the premium payment year) under
the alternative calculation method;
(ii) VBPAY is the plan's current liability as of the first day
of the plan year preceding the premium payment year for vested benefits
of participants and beneficiaries in pay status, computed in accordance
with section 302(d)(7) of ERISA and section 412(l)(7) of the Code;
(iii) VBNON-PAY is the total of the plan's current liability
as of the first day of the plan year preceding the premium payment year
for vested benefits of active and terminated vested participants not in
pay status, computed in accordance with section 302(d)(7) of ERISA and
section 412(l)(7) of the Code, multiplied by 1.07 in accordance with
paragraph (c)(1) of this section;
(iv) RIR is the required interest rate prescribed in paragraph
(b)(1) of this section;
(v) BIR is the post-retirement current liability interest rate used
to determine the pay-status current liability figure referred to in
paragraph (c)(2)(ii) of this section;
(vi) BIA is the pre-retirement current liability interest rate used
to determine the pre-pay-status current liability figures referred to
in paragraph (c)(2)(iii) of this section; and
(vii) ARA is the plan's assumed weighted average retirement age.
(3) Optional use of substitution factors in interest rate
adjustment formula. In lieu of the term, .94 (RIR-BIR), in the
formula prescribed by paragraph (c)(2) of this section, a plan
administrator may use the optional substitution factor provided in the
Premium Payment Package.
(4) Adjusted value of plan assets. The value of plan assets shall
be the actuarial value of plan assets as of the first day of the plan
year preceding the premium payment year, determined in accordance with
section 302(c)(2) of ERISA and section 412(c)(2) of the Code without
reduction for any credit balance in the plan's funding standard
account, unless that amount was determined as of a date other than the
first day of the plan year preceding the premium payment year or the
premium payment year is described in Sec. 4006.4(b)(1)(iii). In either
of those events, the value of plan assets shall be the current value of
assets (as reported on Form 5500) as of that first day or (if Form
5500-EZ is filed) as of the last day of the plan year preceding the
Schedule B year. The value of assets from the Schedule B shall be
adjusted in accordance with paragraph (b)(2) of this section, except
that the amount of all contributions that are included in the value of
assets and that were made after the first day of the plan year
preceding the premium payment year shall be discounted to such first
day at the interest rate prescribed in paragraph (b)(1) of this section
for the premium payment year, compounded annually except that simple
interest may be used for any partial years.
(5) Adjustment for passage of time. The amount of the plan's
unfunded vested benefits shall be adjusted to reflect the passage of
time between the date of the Schedule B data (the first day of the plan
year preceding the premium payment year) and the last day of the plan
year preceding the premium payment year in accordance with the
following formula:
UVBadj=(VBadj-Aadj) x (1+RIR/100)Y;
where--
(i) UVBadj is the amount of the plan's adjusted unfunded
vested benefits;
(ii) VBadj is the value of the adjusted vested benefits
calculated in accordance with paragraphs (c)(1) and (c)(2) of this
section;
(iii) Aadj is the adjusted asset amount calculated in
accordance with paragraph (c)(3) of this section; (iv) RIR is the
required interest rate prescribed in paragraph (b)(1) of this section;
and
(v) Y is deemed to be equal to 1 (unless the plan year preceding
the premium payment year is a short plan year, in which case Y is the
number of years between the first day and the last day of the short
plan year, expressed as a decimal fraction of 1.0 with two digits to
the right of the decimal point).
(d) Restrictions on alternative calculation method for large plans.
(1) The alternative calculation method described in paragraph (c)
of this section may be used for a plan with 500 or more participants as
of the last day of the plan year preceding the premium payment year
only if--
(i) No significant event, as described in paragraph (d)(2) of this
section, has occurred between the first day and the last day of the
plan year preceding the premium payment year, and an enrolled actuary
so certifies in accordance with the Premium Payment Package; or
(ii) An enrolled actuary makes an appropriate adjustment to the
value of unfunded vested benefits to reflect the occurrence of
significant events that have occurred between those dates and certifies
to that fact in accordance with the Premium Payment Package.
(2) The significant events described in this paragraph are--
(i) An increase in the plan's actuarial costs (consisting of the
plan's normal cost under section 302(b)(2)(A) of ERISA and section
412(b)(2)(A) of the Code, amortization charges under section
302(b)(2)(B) of ERISA and section 412(b)(2)(B) of the Code, and
amortization credits under section 302(b)(3)(B) of ERISA and section
412(b)(3)(B) of the Code) attributable to a plan amendment, unless the
cost increase attributable to the amendment is less than 5 percent of
the actuarial costs determined without regard to the amendment;
(ii) The extension of coverage under the plan to a new group of
employees resulting in an increase of 5 percent or more in the plan's
liability for accrued benefits;
(iii) A plan merger, consolidation or spinoff that is not de
minimis pursuant to the regulations under section 414(l) of the Code;
(iv) The shutdown of any facility, plant, store, etc., that creates
immediate eligibility for benefits that would not otherwise be
immediately payable for participants separating from service;
(v) The offer by the plan for a temporary period to permit
participants to retire at benefit levels greater than that to which
they would otherwise be entitled;
(vi) A cost-of-living increase for retirees resulting in an
increase of 5 percent or more in the plan's liability for accrued
benefits; and
(vii) Any other event or trend that results in a material increase
in the value of unfunded vested benefits.
Sec. 4006.5 Exemptions and special rules.
(a) Variable-rate premium exemptions. A plan described in any of
paragraphs (a)(1)-(a)(5) of this section is not required to determine
its unfunded vested benefits under Sec. 4006.4 and does not owe a
variable-rate premium under Sec. 4006.3(b).
(1) Certain fully funded plans. A plan is described in this
paragraph if the plan had fewer than 500 participants on the
[[Page 34019]]
last day of the plan year preceding the premium payment year, and an
enrolled actuary certifies in accordance with the Premium Payment
Package that, as of that date, the plan had no unfunded vested benefits
(valued at the interest rate prescribed in Sec. 4006.4(b)(1)).
(2) Plans without vested benefit liabilities. A plan is described
in this paragraph if it did not have any participants with vested
benefits as of the last day of the plan year preceding the premium
payment year, and the plan administrator so certifies in accordance
with the Premium Payment Package.
(3) Section 412(i) plans. A plan is described in this paragraph if
the plan was a plan described in section 412(i) of the Code and the
regulations thereunder at all times during the plan year preceding the
premium payment year and the plan administrator so certifies, in
accordance with the Premium Payment Package. If the plan is a new plan
or a newly-covered plan, the certification under this paragraph shall
be made as of the due date for the premium under Sec. 4007.11(c) and
shall certify to the plan's status at all times during the premium
payment year through such due date.
(4) Plans terminating in standard terminations. The exemption for a
plan described in this paragraph is conditioned upon the plan's making
a final distribution of assets in a standard termination. If a plan is
ultimately unable to do so, the exemption is revoked and all variable-
rate amounts not paid pursuant to this exemption are due retroactive to
the applicable due date(s). A plan is described in this paragraph if--
(i) The plan administrator has issued notices of intent to
terminate the plan in a standard termination in accordance with section
4041(a)(2) of ERISA; and
(ii) The proposed termination date set forth in the notice of
intent to terminate is on or before the last day of the plan year
preceding the premium payment year.
(5) Plans at full funding limit. A plan is described in this
paragraph if, on or before the earlier of the due date for payment of
the variable-rate portion of the premium under Sec. 4007.11 or the date
that portion is paid, the plan's contributing sponsor or contributing
sponsors made contributions to the plan for the plan year preceding the
premium payment year in an amount not less than the full funding
limitation for such preceding plan year under section 302(c)(7) of
ERISA and section 412(c)(7) of the Code (determined in accordance with
paragraphs (a)(5)(i) and (a)(5)(ii) of this section). In order for a
plan to qualify for this exemption, an enrolled actuary must certify
that the plan has met the requirements of this paragraph.
(i) Determination of full funding limitation. The determination of
whether contributions for the preceding plan year were in an amount not
less than the full funding limitation under section 302(c)(7) of ERISA
and section 412(c)(7) of the Code for such preceding plan year shall be
based on the methods of computing the full funding limitation,
including actuarial assumptions and funding methods, used by the plan
(provided such assumptions and methods met all requirements, including
the requirements for reasonableness, under section 302 of ERISA and
section 412 of the Code) with respect to such preceding plan year. Plan
assets shall not be reduced by the amount of any credit balance in the
plan's funding standard account.
(ii) Rounding of de minimis amounts. Any contribution that is
rounded down to no less than the next lower multiple of one hundred
dollars (in the case of full funding limitations up to one hundred
thousand dollars) or to no less than the next lower multiple of one
thousand dollars (in the case of full funding limitations above one
hundred thousand dollars) shall be deemed for purposes of this
paragraph to be in an amount equal to the full funding limitation.
(b) Special rule for determining vested benefits for certain large
plans. With respect to a plan that had 500 or more participants on the
last day of the plan year preceding the premium payment year, if an
enrolled actuary determines pursuant to Sec. 4006.4(a) that the
actuarial value of plan assets equals or exceeds the value of all
benefits accrued under the plan (valued at the interest rate prescribed
in Sec. 4006.4(b)(1)), the enrolled actuary need not determine the
value of the plan's vested benefits, and may instead report in the
Premium Payment Package the value of the accrued benefits.
(c) Special rule for determining unfunded vested benefits for plans
terminating in distress or involuntary terminations. A plan described
in this paragraph may determine its unfunded vested benefits by using
the special alternative calculation method set forth in this paragraph.
A plan is described in this paragraph if it has issued notices of
intent to terminate in a distress termination in accordance with
section 4041(a)(2) of ERISA with a proposed termination date on or
before the last day of the plan year preceding the premium payment
year, or if the PBGC has instituted proceedings to terminate the plan
in accordance with section 4042 of ERISA and has sought a termination
date on or before the last day of the plan year preceding the premium
payment year. Pursuant to this paragraph, a plan shall determine its
unfunded vested benefits in accordance with the alternative calculation
method in Sec. 4006.4(c), except that--
(1) The calculation shall be based on the Form 5500, Schedule B,
for the plan year which includes (in the case of a distress
termination) the proposed termination date or (in the case of an
involuntary termination) the termination date sought by the PBGC, or,
if no Schedule B is filed for that plan year, on the Schedule B for the
immediately preceding plan year;
(2) All references in Sec. 4006.4(c) and Sec. 4006.4(d) to the
first day of the plan year preceding the premium payment year shall be
deemed to refer to the first day of the plan year for which the
Schedule B was filed;
(3) The value of the sum of the plan's current liability as of the
first day of the plan year preceding the premium payment year for
vested benefits of active and terminated vested participants not in pay
status, computed in accordance with section 302(d)(7) of ERISA and
section 412(l)(7) of the Code, shall be adjusted (in lieu of the
adjustment required by Sec. 4006.4(c)(1)) by multiplying that value by
the sum of 1 plus the product of .07 and the number of years (rounded
to the nearest hundredth of a year) between the date of the Schedule B
data and (in the case of a distress termination) the proposed
termination date or (in the case of an involuntary termination) the
termination date sought by the PBGC; and
(4) The exponent, ``Y,'' in the time adjustment formula of
Sec. 4006.4(c)(5) shall be deemed to equal the number of years (rounded
to the nearest hundredth of a year) between the date of the Schedule B
data and the last day of the plan year preceding the premium payment
year.
(d) Special determination date rule for new and newly-covered
plans. In the case of a new plan or a newly-covered plan, all
references in Secs. 4006.3, 4006.4, and paragraphs (a) and (b) of this
section to the last day of the plan year preceding the premium payment
year shall be deemed to refer to the first day of the premium payment
year or, if later, the date on which the plan became effective for
benefit accruals for future service, and for purposes of determining
the plan's premium, the number of plan participants, and (for a single-
employer plan) the amount of the plan's unfunded vested benefits and
the applicability of any exemption or special rule under
[[Page 34020]]
paragraph (a) or (b) of this section, shall be determined as of such
first day or later date.
(e) Special determination date rule for certain mergers and
spinoffs. (1) With respect to a plan described in paragraph (e)(2) of
this section, all references in Secs. 4006.3, 4006.4, and this section,
as applicable, to the last day of the plan year preceding the premium
payment year shall be deemed to refer to the first day of the premium
payment year.
(2) A plan is described in this paragraph (e)(2) if--
(i) The plan engages in a merger or spinoff that is not de minimis
pursuant to the regulations under section 414(l) of the Code (in the
case of single-employer plans) or pursuant to part 4231 of this chapter
(in the case of multiemployer plans), as applicable;
(ii) The merger or spinoff is effective on the first day of the
plan's premium payment year; and
(iii) The plan is the transferee plan in the case of a merger or
the transferor plan in the case of a spinoff.
(f) Special refund rule for certain short plan years. A plan
described in this paragraph (f) is entitled to a refund for a short
plan year. The amount of the refund will be determined by prorating the
premium for the short plan year by the number of months (treating a
part of a month as a month) in the short plan year. A plan is described
in this paragraph if--
(1) The plan is a new or newly-covered plan that becomes effective
for premium purposes on a date other than the first day of its first
plan year;
(2) The plan adopts an amendment changing its plan year, resulting
in a short plan year;
(3) The plan's assets are distributed pursuant to the plan's
termination, in which case the short plan year for purposes of
computing the amount of the refund under this paragraph shall be deemed
to end on the asset distribution date or, if later (in the case of a
single-employer plan), the date 30 days prior to the date the PBGC
receives the plan's post-distribution certification; or
(4) The plan is a single-employer plan and a trustee of the plan is
appointed pursuant to section 4042 of ERISA, in which case the short
plan year for purposes of computing the amount of the refund under this
paragraph shall be deemed to end on the date of appointment.
(g) Special rules for plans of regulated public utilities. (1) This
paragraph (g) applies to a premium payment year beginning before 1998
of a plan maintained by one or more contributing sponsors at least one
of which is a regulated public utility. For this purpose, a regulated
public utility is one that, as of the beginning of the premium payment
year, is described in section 7701(a)(33)(A)(i) of the Code and has not
begun to collect from utility customers rates that reflect the costs
incurred or projected to be incurred for additional premiums under
section 4006(a)(3)(E) of ERISA pursuant to final and nonappealable
determinations by all public utility commissions (or other authorities
having jurisdiction over the rates and terms of service by the
regulated public utility) that the costs are just and reasonable and
recoverable from customers of the regulated public utility.
(2) Limitation on variable-rate premium and required interest rate.
If every contributing sponsor of a plan described in paragraph (a) of
this section is a regulated public utility, then, notwithstanding the
provisions of Secs. 4006.3(b) and 4006.4(b)(1),--
(i) The variable-rate premium shall not be greater than $53
multiplied by the number of participants in the plan on the last day of
the plan year preceding the premium payment year; and
(ii) If the premium payment year begins after June 1997,
Sec. 4006.4(b)(1) shall be applied as if the applicable percentage
referred to therein were 80 percent.
(3) Proportional application of limitation rules. If a plan is
described in paragraph (g)(1) of this section but also has a
contributing sponsor that is not a regulated public utility and
participants who are not regulated public utility participants
(determined under any reasonable method consistently applied among
participants and from year to year), the limitations in paragraph
(g)(2) of this section shall be applied in proportion to the number of
regulated public utility participants in accordance with the Premium
Payment Package.
(4) Special variable-rate premium rule for certain small regulated
public utility plans paying maximum variable-rate premium. A plan whose
variable-rate premium is subject to the limitation described in
paragraph (g)(2)(i) of this section is not required to determine its
unfunded vested benefits under Sec. 4006.4 if--
(i) The number of participants required to be taken into account in
computing the plan's premium for the premium payment year is fewer than
500; and
(ii) The plan pays a variable-rate premium equal to $53 multiplied
by the number of participants in the plan on the last day of the plan
year preceding the premium payment year.
(5) Effect of omitted or inadequate information. The variable-rate
premium of a plan described in paragraph (g)(2) of this section may be
deemed to be $53 multiplied by the number of participants in the plan
on the last day of the plan year preceding the premium payment year
if--
(i) Any item or items necessary to establish the correct variable-
rate premium for the plan are omitted from the plan's premium filing;
or
(ii) In connection with an audit, the plan's records fail, in the
PBGC's judgment, to establish that the plan's unfunded vested benefits
were of the amount reported by the plan for the premium payment year.
PART 4007--PAYMENT OF PREMIUMS
Sec.
4007.1 Purpose and scope.
4007.2 Definitions.
4007.3 Filing requirement and forms.
4007.4 Filing address.
4007.5 Date of filing.
4007.6 Computation of time.
4007.7 Late payment interest charges.
4007.8 Late payment penalty charges.
4007.9 Coverage for guaranteed basic benefits.
4007.10 Recordkeeping requirements; PBGC audits.
4007.11 Due dates.
4007.12 Liability for single-employer premiums.
Authority: 29 U.S.C. 1302(b)(3), 1306, 1307.
Sec. 4007.1 Purpose and scope.
This part, which applies to all plans that are covered by title IV
of ERISA, provides procedures for paying the premiums imposed by
sections 4006 and 4007 of ERISA. (See part 4006 of this chapter for
premium rates and computational rules.)
Sec. 4007.2 Definitions.
(a) The following terms are defined in Sec. 4001.2 of this chapter:
Code, contributing sponsor, ERISA, insurer, IRS, multiemployer plan,
notice of intent to terminate, PBGC, plan, plan administrator, plan
year, and single-employer plan.
(b) For purposes of this part, the following terms are defined in
Sec. 4006.2 of this chapter: new plan, newly covered plan, participant,
premium payment year, and short plan year.
Sec. 4007.3 Filing requirement and forms.
The estimation, declaration, reconciliation and payment of premiums
shall be made using the forms prescribed by and in accordance with the
instructions in the PBGC annual Premium Payment Package. The plan
administrator of each covered plan shall
[[Page 34021]]
file the prescribed form or forms, and any premium payments due, no
later than the applicable due date specified in Sec. 4007.11.
Sec. 4007.4 Filing address.
Plan administrators shall file all forms required to be filed under
this part and all payments for premiums, interest, and penalties
required to be made under this part at the address specified in the
Premium Payment Package.
Sec. 4007.5 Date of filing.
(a) Any form required to be filed under this part and any payment
required to be made under this part shall be deemed to have been filed
or made on the date on which it is mailed.
(b) A form or payment shall be presumed to have been mailed on the
date on which it is postmarked by the United States Postal Service, or
three days prior to the date on which it is received by the PBGC if it
does not contain a legible United States Postal Service postmark.
Sec. 4007.6 Computation of time.
In computing any period of time prescribed by this part, the day of
the act, event, or default from which the designated period of time
begins to run is not counted. The last day of the period so computed
shall be included, unless it is a Saturday, Sunday, or federal holiday,
in which event the period runs until the end of the next day that is
not a Saturday, Sunday, or federal holiday. For purposes of computing
late payment interest charges under Sec. 4007.7 and late payment
penalty charges under Sec. 4007.8, a Saturday, Sunday or federal
holiday referred to in the previous sentence shall be included.
Sec. 4007.7 Late payment interest charges.
(a) If any premium payment due under this part is not paid by the
due date prescribed for such payment by Sec. 4007.11, an interest
charge will accrue on the unpaid amount at the rate imposed under
section 6601(a) of the Code for the period from the date payment is due
to the date payment is made. Late payment interest charges are
compounded daily.
(b) When PBGC issues a bill for premium payments necessary to
reconcile the premiums paid with the actual premium due, interest will
be accrued on the unpaid premium until the date of the bill if paid no
later than 30 days after the date of such bill. If the bill is not paid
within the 30-day period following the date of such bill, interest will
continue to accrue throughout such 30-day period and thereafter, until
the date paid.
(c) PBGC bills for interest assessed under this section will be
deemed paid when due if paid no later than 30 days after the date of
such bills. Otherwise, interest will accrue in accordance with
paragraph (a) of this section on the amount of the bill from the date
of the bill until the date of payment.
Sec. 4007.8 Late payment penalty charges.
(a) Penalty charge. If any premium payment due under this part is
not paid by the due date prescribed for such payment by Sec. 4007.11,
the PBGC will, unless a waiver is granted pursuant to paragraph (b) of
this section, assess a late payment charge (not to exceed 100% of the
unpaid premium) equal to the greater of--
(i) 5% per month (or fraction thereof) of the unpaid premiums; or
(ii) $25.
(b) Waiver of penalty charge. The late payment penalty charge will
be waived, in whole or in part--
(1) With respect to any premium payment made within 60 days after
the due date prescribed for such payment in Sec. 4007.11, if, before
such due date, the PBGC grants a waiver upon a showing of substantial
hardship arising from the timely payment of the premium and a showing
that the premium will be paid within such 60-day period;
(2) If the PBGC grants a waiver based on any other demonstration of
good cause;
(3) If the PBGC, on its own motion, waives the application of
paragraph (a) of this section;
(4) With respect to any premium payment (excluding any variable-
rate premium under Sec. 4006.3(b)), if a plan that is required to make
a reconciliation filing described in Sec. 4007.11(b)(2)(iii)--
(i) Paid at least 90 percent of the flat-rate premium due for the
premium payment year by the due date specified in
Sec. 4007.11(b)(2)(i); or
(ii) Paid by the due date specified in Sec. 4007.11(b)(2)(i) an
amount equal to the premium that would be due for the premium payment
year, computed using the flat per capita premium rate for the premium
payment year and the participant count upon which the prior year's
premium was based; and
(iii) Pays 100 percent of the flat-rate premium due for the premium
payment year under Sec. 4006.3 on or before the due date for the
reconciliation filing under Sec. 4007.11(b)(2)(iii); or
(5) With respect to any PBGC bills for the premium payment
necessary to reconcile the premium paid with the actual premium due, if
such bills are paid no later than 30 days after the date of such bills.
Sec. 4007.9 Coverage for guaranteed basic benefits.
(a) The failure by a plan administrator to pay the premiums due
under this part will not result in that plan's loss of coverage for
basic benefits guaranteed under sections 4022(a) or 4022A(a) of ERISA.
(b) The payment of the premiums imposed by this part will not
result in coverage for basic benefits guaranteed under sections 4022(a)
or 4022A(a) of ERISA for plans not covered under title IV of ERISA.
Sec. 4007.10 Recordkeeping requirements; PBGC audits.
(a) Retention of records to support premium payments. All plan
records, including calculations and other data prepared by an enrolled
actuary or, for a plan described in section 412(i) of the Code, by the
insurer from which the insurance contracts are purchased, that are
necessary to support or to validate premium payments under this part
shall be retained by the plan administrator for a period of six years
after the premium due date. Records that must be retained pursuant to
this paragraph include, but are not limited to, records that establish
the number of plan participants and that reconcile the calculation of
the plan's unfunded vested benefits with the actuarial valuation upon
which the calculation was based. Records retained pursuant to this
paragraph shall be made available to the PBGC upon request for
inspection and photocopying.
(b) PBGC audit. Premium payments under this part are subject to
audit by the PBGC. If, upon audit, the PBGC determines that a premium
due under this part was underpaid, the late payment interest charges
under Sec. 4007.7 and the late payment penalty charges under
Sec. 4007.8 shall apply to the unpaid balance from the premium due date
to the date of payment. In determining the premium due, if, in the
judgment of the PBGC, the plan's records fail to establish the number
of plan participants with respect to whom premiums were required for
any premium payment year, the PBGC may rely on data it obtains from
other sources (including the IRS and the Department of Labor) for
presumptively establishing the number of plan participants for premium
computation purposes.
Sec. 4007.11 Due dates.
(a) In general. The premium filing due date for small plans is
prescribed in paragraph (a)(1) of this section and the premium filing
due dates for large plans are prescribed in paragraph (a)(2) of this
section.
[[Page 34022]]
(1) Plans with fewer than 500 participants. If the plan has fewer
than 500 participants, as determined under paragraph (b) of this
section, the due date is the fifteenth day of the eighth full calendar
month following the month in which the plan year began.
(2) Plans with 500 or more participants. If the plan has 500 or
more participants, as determined under paragraph (b) of this section--
(i) The due date for the flat-rate premium required by
Sec. 4006.3(a) is the last day of the second full calendar month
following the close of the plan year preceding the premium payment
year; and
(ii) The due date for the variable-rate premium required by
Sec. 4006.3(b) for single-employer plans is the fifteenth day of the
eighth full calendar month following the month in which the premium
payment year begins.
(iii) If the number of plan participants on the last day of the
plan year preceding the premium payment year is not known by the date
specified in paragraph (a)(2)(i) of this section, a reconciliation
filing (on the form prescribed by this part) and any required premium
payment or request for refund shall be made by the date specified in
paragraph (a)(2)(ii) of this section.
(3) Plans that change plan years. For any plan that changes its
plan year, the premium form or forms and payment or payments for the
short plan year shall be filed by the applicable due date or dates
specified in paragraphs (a)(1), (a)(2), or (c) of this section. For the
plan year that follows a short plan year, the due date or dates for the
premium forms and payments shall be, with respect to each such due
date, the later of--
(i) The applicable due date or dates specified in paragraph (a)(1)
or (a)(2) of this section; or
(ii) 30 days after the date on which the amendment changing the
plan year was adopted.
(b) Participant count rule for purposes of determining filing due
dates. For purposes of determining under paragraph (a) of this section
whether a plan has fewer than 500 participants, or 500 or more
participants, the plan administrator shall use--
(1) For a single-employer plan, the number of participants for whom
premiums were payable for the plan year preceding the premium payment
year, or
(2) For a multiemployer plan,--
(i) If the premium payment year is the plan's second plan year, the
first day of the first plan year; or
(ii) If the premium payment year is the plan's third or a
subsequent plan year, the last day of the second preceding plan year.
(c) Due dates for new and newly covered plans. Notwithstanding
paragraph (a) of this section, the premium form and all premium
payments due for the first plan year of coverage of any new plan or
newly covered plan shall be filed on or before the latest of--
(1) The fifteenth day of the eighth full calendar month following
the month in which the plan year began or, if later, in which the plan
became effective for benefit accruals for future service;
(2) 90 days after the date of the plan's adoption; or
(3) 90 days after the date on which the plan became covered by
title IV of ERISA.
(d) Continuing obligation to file. The obligation to file the form
or forms prescribed by this part and to pay any premiums due continues
through the plan year in which all plan assets are distributed pursuant
to a plan's termination or in which a trustee is appointed under
section 4042 of ERISA, whichever occurs earlier. The entire premium
computed under this part is due, irrespective of whether the plan is
entitled to a refund for a short plan year pursuant to Sec. 4006.5(f).
(e) Improper filings. Any form not filed in accordance with this
part, not filed in accordance with the instructions in the Premium
Payment Package, not accompanied by the required premium payment, or
otherwise incomplete, may, in the discretion of the PBGC, be returned
with any payment accompanying the form to the plan administrator, and
such payment shall be treated as not having been made.
Sec. 4007.12 Liability for single-employer premiums.
(a) The designation under this part of the plan administrator as
the person required to file the applicable forms and to submit the
premium payment for a single-employer plan is a procedural requirement
only and does not alter the liability for premium payments imposed by
section 4007 of ERISA. Pursuant to section 4007(e) of ERISA, both the
plan administrator and the contributing sponsor of a single-employer
plan are liable for premium payments, and, if the contributing sponsor
is a member of a controlled group, each member of the controlled group
is jointly and severally liable for the required premiums. Any entity
that is liable for required premiums is also liable for any interest
and penalties assessed with respect to such premiums.
(b) For any plan year in which a plan administrator issues
(pursuant to section 4041(a)(2) of ERISA) notices of intent to
terminate in a distress termination under section 4041(c) of ERISA or
the PBGC initiates a termination proceeding under section 4042 of
ERISA, and for each plan year thereafter, the obligation to pay the
premiums (and any interest or penalties thereon) imposed by ERISA and
this part for a single-employer plan shall be an obligation solely of
the contributing sponsor and the members of its controlled group, if
any.
(Approved by the Office of Management and Budget under control
number 1212-0009)
PART 4010--ANNUAL FINANCIAL AND ACTUARIAL INFORMATION REPORTING
Sec.
4010.1 Purpose and scope.
4010.2 Definitions.
4010.3 Filing requirement.
4010.4 Filers.
4010.5 Information year.
4010.6 Information to be filed.
4010.7 Identifying information.
4010.8 Plan actuarial information.
4010.9 Financial information.
4010.10 Due date and filing with the PBGC.
4010.11 Waivers and extensions.
4010.12 Confidentiality of information submitted.
4010.13 Penalties.
4010.14 OMB control number.
Authority: 29 U.S.C. 1302(b)(3); 29 U.S.C. 1310.
Sec. 4010.1 Purpose and scope.
This part prescribes the requirements for annual filings with the
PBGC under section 4010 of ERISA. This part applies to filers for any
information year ending on or after December 31, 1995.
Sec. 4010.2 Definitions.
The following terms are defined in Sec. 4001.2 of this chapter:
benefit liabilities, Code, contributing sponsor, controlled group,
ERISA, fair market value, IRS, PBGC, person, plan, and plan year.
In addition, for purposes of this part:
Exempt entity means a person who does not have to file information
and about whom information does not have to be filed, as described in
Sec. 4010.4(d) of this part.
Exempt plan means a plan about which actuarial information does not
have to be filed, as described in Sec. 4010.8(c) of this part.
Fair market value of the plan's assets means the fair market value
of the plan's assets at the end of the plan year ending within the
filer's information year (determined without regard to any
contributions receivable).
[[Page 34023]]
Filer means a person who is required to file reports, as described
in Sec. 4010.4 of this part.
Fiscal year means, with respect to a person, the person's annual
accounting period or, if the person has not adopted a closing date, the
calendar year.
Information year means the year determined under Sec. 4010.5 of
this part.
Sec. 4010.3 Filing requirement.
(a) In general. Except as provided in Sec. 4010.8(c) (relating to
exempt plans) and except where waivers have been granted under
Sec. 4010.11 of this part, each filer shall submit to the PBGC
annually, on or before the due date specified in Sec. 4010.10, all
information specified in Sec. 4010.6(a) with respect to all members of
a controlled group and all plans maintained by members of a controlled
group.
(b) Single controlled group submission. Any filer or other person
may submit the information specified in Sec. 4010.6(a) on behalf of one
or more members of a filer's controlled group. If a person other than a
filer submits the information, the submission must also include a
written power of attorney signed by a filer authorizing the person to
act on behalf of one or more filers.
Sec. 4010.4 Filers.
(a) General. A contributing sponsor of a plan and each member of
the contributing sponsor's controlled group is a filer with respect to
an information year (unless exempted under paragraph (d) of this
section) if--
(1) the aggregate unfunded vested benefits of all plans (including
any exempt plans) maintained by the members of the contributing
sponsor's controlled group exceed $50 million (disregarding those plans
with no unfunded vested benefits);
(2) any member of a controlled group fails to make a required
installment or other required payment to a plan and, as a result, the
conditions for imposition of a lien described in section 302(f)(1) (A)
and (B) of ERISA or section 412(n)(1) (A) and (B) of the Code have been
met during the information year, and the required installment or other
required payment is not made within ten days after its due date; or
(3) any plan maintained by a member of a controlled group has been
granted one or more minimum funding waivers under section 303 of ERISA
or section 412(d) of the Code totaling in excess of $1 million that, as
of the end of the plan year ending within the information year, are
still outstanding (determined in accordance with paragraph (c) of this
section).
(b) Unfunded vested benefits--(1) General. Except as provided in
paragraph (b)(2) of this section, for purposes of the $50 million test
in paragraph (a)(1) of this section, the value of a plan's unfunded
vested benefits is determined at the end of the plan year ending within
the filer's information year in accordance with section
4006(a)(3)(E)(iii) of ERISA and Sec. 4006.4 of this chapter (without
reference to the exemptions and special rules under Sec. 4006.5).
(2) Optional assumptions. Prior to the first information year in
which the mortality assumptions prescribed under section
302(d)(7)(C)(ii)(II) of ERISA apply to all of the plans maintained by a
controlled group, the value of unfunded vested benefits for a plan may
be determined by substituting for the respective assumptions used under
paragraph (b)(1) of this section (but not using the alternative
calculation method under Sec. 4006.4(c) of this chapter) all of the
following assumptions:
(i) an interest rate equal to 100% of the annual yield for 30-year
Treasury constant maturities (as reported in Federal Reserve
Statistical Release G.13 and H.15) for the last full calendar month in
the plan year;
(ii) the fair market value of the plan's assets; and
(iii) the mortality tables described in section 302(d)(7)(C)(ii)(I)
of ERISA or section 412(l)(7)(C)(ii)(I) of the Code; provided that for
any plan year ending on or after the effective date of an amendment
changing the mortality assumptions used to value benefits to be paid as
annuities in trusteed plans under part 4044 of this chapter, those
amended mortality assumptions shall be used.
(c) Outstanding waiver. Before the end of the statutory
amortization period, a minimum funding waiver for a plan is considered
outstanding unless--
(1) a credit balance exists in the funding standard account
(described in section 302(b) of ERISA and section 412(b) of the Code)
that is no less than the outstanding balance of all waivers for the
plan;
(2) a waiver condition or contractual obligation requires that a
credit balance as described in paragraph (c)(1) continue to be
maintained as of the end of each plan year during the remainder of the
statutory amortization period for the waiver; and
(3) no portion of any credit balance described in paragraph (c)(1)
is used to make any required installment under section 302(e) of ERISA
or section 412(m) of the Code for any plan year during the remainder of
the statutory amortization period.
(d) Exempt entities. A person is an exempt entity if the person--
(1) is not a contributing sponsor of a plan (other than an exempt
plan);
(2) has revenue for its fiscal year ending within the controlled
group's nformation year that is five percent or less of the controlled
group's revenue for the fiscal year(s) ending within the information
year;
(3) has annual operating income for the fiscal year ending within
the controlled group's information year that is no more than the
greater of--
(i) five percent of the controlled group's annual operating income
for the fiscal year(s) ending within the information year, or
(ii) $5 million; and
(4) has net assets at the end of the fiscal year ending within the
controlled group's information year that is no more than the greater
of--
(i) five percent of the controlled group's net assets at the end of
the fiscal year(s) ending within the information year, or
(ii) $5 million.
Sec. 4010.5 Information year.
(a) Determinations based on information year. An information year
is used under this part to determine which persons are filers
(Sec. 4010.4), what information a filer must submit (Secs. 4010.6-
4010.9), whether a plan is an exempt plan (Sec. 4010.8(c)), and the due
date for submitting the information (Sec. 4010.10(a)).
(b) General. Except as provided in paragraph (c) of this section, a
person's information year shall be the fiscal year of the person. A
filer is not required to change its fiscal year or the plan year of a
plan, to report financial information for any accounting period other
than an existing fiscal year, or to report actuarial information for
any plan year other than an existing plan year.
(c) Controlled group members with different fiscal years-- (1) Use
of calendar year. If members of a controlled group (disregarding any
exempt entity) report financial information on the basis of different
fiscal years, the information year shall be the calendar year.
(2) Example. Filers A and B are members of the same controlled
group. Filer A has a July 1 fiscal year, and filer B has an October 1
fiscal year. The information year is the calendar year. Filer A's
financial information with respect to its fiscal year ending June 30,
1996, and filer B's financial information with respect to its fiscal
year ending September 30, 1996, must be submitted to the PBGC following
the end of the 1996 calendar year (the calendar year in
[[Page 34024]]
which those fiscal years end). If filer B were an exempt entity, the
information year would be filer A's July 1 fiscal year.
Sec. 4010.6 Information to be filed.
(a) General. A filer must submit the information specified in
Sec. 4010.7 (identifying information), Sec. 4010.8 (plan actuarial
information) and Sec. 4010.9 (financial information) of this part with
respect to each member of the filer's controlled group and each plan
maintained by any member of the controlled group.
(b) Additional information. By written notification, the PBGC may
require any filer to submit additional actuarial or financial
information that is necessary to determine plan assets and liabilities
for any period through the end of the filer's information year, or the
financial status of a filer for any period through the end of the
filer's information year. The information must be submitted within ten
days after the date of the written notification or by a different time
specified therein.
(c) Previous submissions. If any required information has been
previously submitted to the PBGC, a filer may incorporate this
information into the required submission by referring to the previous
submission.
Sec. 4010.7 Identifying information.
(a) Filers. Each filer is required to provide the following
identifying information with respect to each member of the controlled
group (excluding exempt entities)--
(1) the name, address, and telephone number of each member of the
controlled group and the legal relationships of each (for example,
parent, subsidiary); and
(2) the nine-digit Employer Identification Number (EIN) assigned by
the IRS to each member (or if there is no EIN for a member, an
explanation).
(b) Plans. Each filer is required to provide the following
identifying information with respect to each plan (including exempt
plans) maintained by any member of the controlled group (including
exempt entities)--
(1) the name of each plan;
(2) the EIN and the three-digit Plan Number (PN) assigned by the
contributing sponsor to each plan (or if there is no EIN or PN for a
plan, an explanation); and
(3) if the EIN or PN of a plan has changed since the beginning of
the filer's information year, the previous EIN or PN and an
explanation.
Sec. 4010.8 Plan actuarial information.
(a) Required information. For each plan (other than an exempt plan)
maintained by any member of the filer's controlled group, each filer is
required to provide the following actuarial information--
(1) the fair market value of the plan's assets;
(2) the value of the plan's benefit liabilities (determined in
accordance with paragraph (d) of this section) at the end of the plan
year ending within the filer's information year;
(3) a copy of the actuarial valuation report for the plan year
ending within the filer's information year that contains or is
supplemented by the following information--
(i) each amortization base and related amortization charge or
credit to the funding standard account (as defined in section 302 (b)
of ERISA or section 412 (b) of the Code) for that plan year (excluding
the amount considered contributed to the plan as described in section
302(b)(3)(A) of ERISA or section 412(b)(3)(A) of the Code),
(ii) the itemized development of the additional funding charge
payable for that plan year pursuant to section 412(l) of the Code,
(iii) the minimum funding contribution and the maximum deductible
contribution for that plan year,
(iv) the actuarial assumptions and methods used for that plan year
for purposes of section 302(b) and (d) of ERISA or section 412(b) and
(l) of the Code (and any change in those assumptions and methods since
the previous valuation and justifications for any change), and
(v) a summary of the principal eligibility and benefit provisions
on which the valuation of the plan was based (and any changes to those
provisions since the previous valuation), along with descriptions of
any benefits not included in the valuation, any significant events that
occurred during that plan year, and the plan's early retirement
factors; and
(4) a written certification by an enrolled actuary that, to the
best of his or her knowledge and belief, the actuarial information
submitted is true, correct, and complete and conforms to all applicable
laws and regulations, provided that this certification may be qualified
in writing, but only to the extent the qualification(s) are permitted
under 26 CFR Sec. 301.6059-1(d).
(b) Alternative compliance for plan actuarial information. If any
of the information specified in paragraph (a)(3) of this section is not
available by the date specified in Sec. 4010.10(a), a filer may satisfy
the requirement to provide such information by--
(1) including a statement, with the material that is submitted to
the PBGC, that the filer will file the unavailable information by the
alternative due date specified in Sec. 4010.10(b) of this part, and
(2) filing such information (along with a certification by an
enrolled actuary under paragraph (a)(4) of this section) with the PBGC
by that alternative due date.
(c) Exempt plan. The actuarial information specified in this
section is not required with respect to a plan that, as of the end of
the plan year ending within the filer's information year, has fewer
than 500 participants or has benefit liabilities (determined in
accordance with paragraph (d) of this section) equal to or less than
the fair market value of the plan's assets, provided that the plan--
(1) has received, on or within ten days after their due dates, all
required installments or other payments required to be made during the
information year under section 302 of ERISA or section 412 of the Code;
and
(2) has no minimum funding waivers outstanding (as described in
Sec. 4010.4(c) of this part) as of the end of the plan year ending
within the information year.
(d) Value of benefit liabilities. The value of a plan's benefit
liabilities at the end of a plan year shall be determined using the
plan census data described in paragraph (d)(1) of this section and the
actuarial assumptions and methods described in paragraph (d)(2) or,
where applicable, (d)(3) of this section.
(1) Census data.
(i) Census data period. Plan census data shall be determined (for
all plans for any information year) either as of the end of the plan
year or as of the beginning of the next plan year.
(ii) Projected census data. If actual plan census data is not
available, a plan may use a projection of plan census data from a date
within the plan year. The projection must be consistent with
projections used to measure pension obligations of the plan for
financial statement purposes and must give a result appropriate for the
end of the plan year for these obligations. For example, adjustments to
the projection process will be required where there has been a
significant event (such as a plan amendment or a plant shutdown) that
has not been reflected in the projection data.
(2) Actuarial assumptions and methods. The value of benefit
liabilities shall be determined using the assumptions and methods
applicable to the valuation of benefits to be paid as annuities in
trusteed plans terminating at the end of the plan year (as prescribed
[[Page 34025]]
in Secs. 4044.51 through 4044.57 of this chapter).
(3) Special actuarial assumptions for exempt plan determination.
Solely for purposes of determining whether a plan is an exempt plan,
the value of benefit liabilities may be determined by substituting for
the retirement age assumptions in paragraph (d)(2) the retirement age
assumptions used by the plan for that plan year for purposes of section
302(d) of ERISA or section 412(l) of the Code.
Sec. 4010.9 Financial information.
(a) General. Except as provided in this section, each filer is
required to provide the following financial information for each
controlled group member (other than an exempt entity)--
(1) audited financial statements for the fiscal year ending within
the information year (including balance sheets, income statements, cash
flow statements, and notes to the financial statements);
(2) if audited financial statements are not available by the date
specified in Sec. 4010.10(a), unaudited financial statements for the
fiscal year ending within the information year; or
(3) if neither audited nor unaudited financial statements are
available by the date specified in Sec. 4010.10(a), copies of federal
tax returns for the tax year ending within the information year.
(b) Consolidated financial statements. If the financial information
of a controlled group member is combined with the information of other
group members in consolidated financial statements, a filer may provide
the following financial information in lieu of the information required
in paragraph (a) of this section--
(1) the audited consolidated financial statements for the filer's
information year or, if the audited consolidated financial statements
are not available by the date specified in Sec. 4010.10(a), unaudited
consolidated financial statements for the fiscal year ending within the
information year; and
(2) for each controlled group member included in the consolidated
financial statements that is a contributing sponsor of a plan (other
than an exempt plan), the contributing sponsor's revenues and operating
income for the information year, and net assets at the end of the
information year.
(c) Subsequent submissions. If unaudited financial statements are
submitted as provided in paragraph (a)(2) or (b)(1) of this section,
audited financial statements must thereafter be filed within 15 days
after they are prepared. If federal tax returns are submitted as
provided in paragraph (a)(3) of this section, audited and unaudited
financial statements must thereafter be filed within 15 days after they
are prepared.
(d) Submission of public information. If any of the financial
information required by paragraphs (a) through (c) of this section is
publicly available, the filer, in lieu of submitting such information
to the PBGC, may include a statement with the other information that is
submitted to the PBGC indicating when such financial information was
made available to the public and where the PBGC may obtain it. For
example, if the controlled group member has filed audited financial
statements with the Securities and Exchange Commission, it need not
file the financial statements with PBGC but instead can identify the
SEC filing as part of its submission under this part.
(e) Inclusion of information about non-filers and exempt entities.
Consolidated financial statements provided pursuant to paragraph (b)(1)
of this section may include financial information of persons who are
not controlled group members (e.g., joint ventures) or are exempt
entities.
Sec. 4010.10 Due date and filing with the PBGC.
(a) Due date. Except as permitted under paragraph (b) of this
section, a filer shall file the information required under this part
with the PBGC on or before the 105th day after the close of the filer's
information year.
(b) Alternative due date. A filer that includes the statement
specified in Sec. 4010.8(b)(1) with its submission to the PBGC by the
date specified in paragraph (a) of this section must submit the
actuarial information specified in Sec. 4010.8(b)(2) within 15 days
after the deadline for filing the plan's annual report (Form 5500
series) for the plan year ending within the filer's information year
(see Sec. 2520.104a-5(a)(2) of this title).
(c) How to file. Requests and information may be delivered by mail,
by delivery service, by hand, or by any other method acceptable to the
PBGC, to: Corporate Finance and Negotiations Department, Pension
Benefit Guaranty Corporation, 1200 K Street, N.W., Washington, DC
20005-4026.
(d) Date when information filed. Information filed under this part
is considered filed--
(1) on the date of the United States postmark stamped on the cover
in which the information is mailed, if--
(i) the postmark was made by the United States Postal Service; and
(ii) the document was mailed postage prepaid, properly addressed to
the PBGC; or
(2) if the conditions stated in paragraph (d)(1) of this section
are not met, on the date it is received by the PBGC. Information
received on a weekend or Federal holiday or after 5:00 p.m. on a
weekday is considered filed on the next regular business day.
(e) Computation of time. In computing any period of time under this
part, the day of the act or event from which the designated period of
time begins to run shall not be included. The last day of the period so
computed shall be included, unless it is a weekend or Federal holiday,
in which event the period runs until the end of the next day that is
not a weekend or Federal holiday.
Sec. 4010.11 Waivers and extensions.
The PBGC may waive the requirement to submit information with
respect to one or more filers or plans or may extend the applicable due
date or dates specified in Sec. 4010.10 of this part. The PBGC will
exercise this discretion in appropriate cases where it finds convincing
evidence supporting a waiver or extension; any waiver or extension may
be subject to conditions. A request for a waiver or extension must be
filed in writing with the PBGC at the address provided in
Sec. 4010.10(c) no later than 15 days before the applicable date
specified in Sec. 4010.10 of this part, and must state the facts and
circumstances on which the request is based.
Sec. 4010.12 Confidentiality of information submitted.
In accordance with Sec. 4901.21(a)(3) of this chapter and section
4010(c) of ERISA, any information or documentary material that is not
publicly available and is submitted to the PBGC pursuant to this part
shall not be made public, except as may be relevant to any
administrative or judicial action or proceeding or for disclosures to
either body of Congress or to any duly authorized committee or
subcommittee of the Congress.
Sec. 4010.13 Penalties.
If all of the information required under this part is not provided
within the specified time limit, the PBGC may assess a separate penalty
under section 4071 of ERISA against the filer and each member of the
filer's controlled group (other than an exempt entity) of up to $1,000
a day for each day that the failure continues. The PBGC may also pursue
other equitable or legal remedies available to it under the law.
[[Page 34026]]
Sec. 4010.14 OMB control number.
The collection of information requirements contained in this part
have been approved by the Office of Management and Budget under OMB
Control Number 1212-0049.
PART 4011--DISCLOSURE TO PARTICIPANTS
Sec.
4011.1 Purpose and scope.
4011.2 Definitions.
4011.3 Notice requirement.
4011.4 Small plan rules.
4011.5 Exemption for new and newly-covered plans.
4011.6 Mergers, consolidations, and spinoffs.
4011.7 Persons entitled to receive notice.
4011.8 Time of notice.
4011.9 Manner of issuance of notice.
4011.10 Form of notice.
4011.11 OMB control number.
Appendix A to Part 4011--Model Participant Notice. Appendix B to Part
4011--Table of maximum Guaranteed Benefits.
Authority: 29 U.S.C. 1302(b)(3), 1311.
Sec. 4011.1 Purpose and scope.
This part prescribes rules and procedures for complying with the
requirements of section 4011 of ERISA. This part applies for any plan
year beginning on or after January 1, 1995, with respect to any single-
employer plan that is covered by section 4021 of ERISA.
Sec. 4011.2 Definitions.
The following terms are defined in Sec. 4001.2 of this chapter:
contributing sponsor, employer, ERISA, normal retirement age, PBGC,
person, plan, plan administrator, plan year, and single-employer plan.
In addition, for purposes of this part:
Participant has the meaning in Sec. 4041.2 of this chapter.
Participant Notice means the notice required pursuant to section
4011 of ERISA and this part.
Sec. 4011.3 Notice requirement.
(a) General. Except as otherwise provided in this part, the plan
administrator of a plan must provide a Participant Notice for a plan
year if a variable rate premium is payable for the plan under section
4006(a)(3)(E) of ERISA and part 4006 of this chapter for that plan
year, unless, for that plan year or for the prior plan year, the plan
meets the Deficit Reduction Contribution (``DRC'') Exception Test in
paragraph (b) of this section. The DRC Exception Test may be applied
using t
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