Several trade groups are urging the Department of Labor’s Employee Benefits Security Administration to extend a temporary enforcement policy on exemptions related to fiduciary recommendations.

Introduced during the Trump administration, “Improving Investment Advice for Worker & Retirees,” as the rule is known, includes a provision that essentially allows investment advisors, broker-dealers and other investment professionals to collect 12b-1 fees, sales loads charges and revenue sharing payments while providing advice on rollovers, under certain conditions, as reported.

But it's set to expire on December 20, and major industry groups are pushing the agency to extend it by at least six months.

In February, after President Joe Biden took over the White House, the DOL said that it would implement the rule as scheduled under Trump, as reported.

Deputy Assistant Secretary of Labor for the Employee Benefits Security Administration Ali Khawar said at the time that the agency would continue looking at possible improvements to the exemption.

But in a letter to Khawar, the U.S. Chamber of Commerce,Sifma, the Investment Company Institute and the Insured Retirement Institute, among other organizations, are urging an extension of six to 12 months beyond that date.

“EBSA and all stakeholders would benefit from such an extension, as it would allow firms to thoughtfully consider using Prohibited Transaction Exemption 2020-02 and implement it most effectively, while reducing consumer confusion and disruption that would follow from retaining the current date,” the groups wrote.

According to the letter, an extension would allow firms the time needed “to refine and test their compliance tools and mechanisms,” particularly smaller firms that the groups say may have been less aware of the expiration date.

In addition, the groups write that they’re concerned about timing of any new proposal, which they claim could make the proposal a “moving target” sowing confusion and increase compliance costs.

Do you have a news tip you’d like to share with FA-IQ? Email us at editorial@financialadvisoriq.com.