DOL Finalizes Plans for Fiduciary-Only Regime

Apr 24, 2024 | Business

 Today, the U.S. Department of Labor released the final version of its “Retirement Security Rule.” After initial review of the fiduciary rulemaking package as detailed in the Fact Sheet, it appears that the Department failed to make any substantive or meaningful improvements to the proposed rule despite significant, specific and data-supported feedback from industry stakeholders. As a result, financial services professionals face a new regulatory regime that imposes a blanket fiduciary threshold for recommending an annuity in a rollover transaction. Moreover, the DOL has largely left intact a constrained and practically unworkable PTE 84-24, a prohibited transaction exemption that has served both retirement savers and those giving financial advice for decades.

“Though disappointing, the release of this final rule is unsurprising,” said Chuck DiVencenzo, NAFA’s president and CEO. “It has been obvious from the outset that the DOL was intent on continuing its quest to push the regulatory boundary of IRAs past the original Congressional intent of The Employee Retirement Income Security Act of 1974 under false pretenses supported by back-of-the-napkin calculations.

“The process has been marred by a paucity of meaningful engagement between the DOL and industry stakeholders. Instead, the Department has dangerously rushed to put into effect a rule that disregards the value of independent distribution, the desire for Main Street savers to work with the professional service providers of their choosing and the need for products that can provide predictable lifetime income. Ultimately, we anticipate more confusion, higher costs and less financial security for low- and middle-income savers who need it most.”

Recently, fixed annuity sales have experienced several quarters of record sales numbers, in part due to consumer concerns about ongoing market volatility and longevity risk. Annuities are the only financial product that allows retirement savers to protect a portion of their nest egg from market declines while providing the opportunity to earn interest and generate a predictable stream of income payments that last a lifetime. Meanwhile, according to the Investment Company Institute, approximately $6.9 trillion in assets are held in more than 710,000 401(k) plans, on behalf of about 70 million active participants and millions of former employees and retirees. The new rule is expected to significantly hinder the ability of independent annuity professionals to use annuity products to help Americans move some of their hard-earned retirement savings out of such defined contribution plans into a vehicle that can help augment their retirement security.

“This Administration has repeatedly cited its desire to institute commonsense policies that help protect consumers from financial harm. Yet here we are with new regulations that contradict robust, uniform consumer protections that have been implemented by the states to ensure financial professionals are providing recommendations in their clients’ best interests,” said DiVencenzo. “Currently, according to LIMRA data, more than 40 percent of annuity sales are conducted by those professionals in the independent channels, which will unquestionably be most negatively impacted by the burdensome compliance requirements of this rule. Instead of celebrating the hard work these professionals do to combat retirement savings challenges, the DOL is effectively threatening their livelihoods and the future of millions of Americans they diligently serve.”

In the days ahead, NAFA will work in close partnership with its membership, industry trade association colleagues and legal counsel to conduct a comprehensive analysis of the final rule and will now pivot to all necessary and available avenues to fight this regulatory overreach.

About NAFA
NAFA, the National Association for Fixed Annuities, is the premier trade association exclusively dedicated to fixed annuities. Our mission is to promote the awareness and understanding of fixed annuities. We educate annuity salespeople, regulators, legislators, journalists, and industry personnel about the value of fixed annuities and their benefits to consumers. NAFA’s membership represents every aspect of the fixed annuity marketplace covering fixed annuities sold by independent agents, advisors and brokers. NAFA was founded in 1998. For more information, visit www.nafa.com.

NAFA
Chuck DiVencenzo – President & CEO
414-332-9306
nafa.com

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Japan – MHI Finalizes Terms of First Transition Bond Issuance

Sep 2, 2022 | Business

Mitsubishi Heavy Industries, Ltd. (MHI) has finalized the issuance terms of the transition bond being issued today via public offering in the domestic market, as announced in the Company’s press release of August 5, 2022.

The issuance is based on MHI’s selection as a model example for the “2021 Climate Transition Finance Model Projects”* being supported by the Ministry of Economy, Trade and Industry (METI), as announced in the Company’s press release of March 18, 2022. One of the unique features of this model example is that MHI not only plans to achieve emission reductions from its own economic activities, but will also attempt to enable the realization of transition strategies of other parties through its products and services.

Through issuance of its first transition bond, MHI looks to diversify its fund procurement methods and achieve its target of carbon neutrality by 2040.

*Projects supported by METI which provide information on and reduce the assessment costs of examples that are deemed to have model qualities for promoting the spread of transition finance. Examples that conform to the “Basic Guidelines on Climate Transition Finance,” formulated by the Ministry of the Environment (MOE) and the Financial Services Agency (FSA), and have model qualities are selected as model examples. For further information: bit.ly/3RgPNh5

About MHI Group

Mitsubishi Heavy Industries (MHI) Group is one of the world’s leading industrial groups, spanning energy, smart infrastructure, industrial machinery, aerospace and defense. MHI Group combines cutting-edge technology with deep experience to deliver innovative, integrated solutions that help to realize a carbon neutral world, improve the quality of life and ensure a safer world. For more information, please visit www.mhi.com or follow our insights and stories on spectra.mhi.com.

Copyright ©2022 JCN Newswire. All rights reserved. A division of Japan Corporate News Network.

FDA In Brief: FDA Finalizes Guidance with Internationally Harmonized Recommendations to Further Support Safe, High-Quality Human Drug Products

May 11, 2021 | Business

“The FDA is continually working to promote drug innovation and improvement, strengthen quality assurance, safety and supply of drug products and enable more efficient use of industry and regulatory resources. Through the harmonization of requirements for drug lifecycle management, manufacturers and the FDA can meet these goals in less time through effective management of postapproval changes. To help provide a more predictable and efficient approach to management of postapproval changes, today we’re announcing a final guidance for industry with new International Council for Harmonisation (ICH) guidelines.

Effective implementation of this guidance will provide an opportunity for the FDA to focus attention and resources on higher risk postapproval changes, incentivizing manufacturers with additional flexibilities to continually improve their manufacturing processes, which can reduce the likelihood of quality-related supply disruptions and related drug shortages.

This guidance reflects just one element in the FDA’s work with regulatory authorities and industry associations from around the world to promote international harmonization of regulatory requirements under the ICH. The FDA is committed to continue seeking scientifically-based harmonized technical procedures for the development and manufacture of drugs.”

Additional Information

  • Today, the U.S. Food and Drug Administration is announcing the availability of a final guidance for industry, “Q12 Technical and Regulatory Considerations for Pharmaceutical Product Lifecycle Management.” This guidance, which was adopted as an ICH Guideline in November 2019, provides a framework to facilitate the management of postapproval chemistry, manufacturing and controls changes in a more predictable and efficient manner. The guidance discusses how to identify the elements in an application that are considered necessary to assure product quality and therefore would require a regulatory submission if changed postapproval.
  • In addition to postapproval changes, the guidance has the potential to help facilitate innovations in manufacturing through a flexible, risk-based approach to regulatory oversight. Encouraging continual product improvement can help reduce product variability and prevent and mitigate shortages related to manufacturing and quality issues. In addition to benefitting industry and regulators, the approach discussed in the guidance will help to assure that patients have access to high quality therapies.
  • The FDA publishes ICH guidelines as FDA guidances. This guidance is applicable to pharmaceutical drug substances and products (both chemical and biological) that require a marketing authorization and to drug-device and biological product-device combination products that fall under the jurisdiction of the Center for Drug Evaluation and Research or the Center for Biologics Evaluation and Research. Changes needed to comply with new or revised pharmacopoeial monographs are not within the scope of this guidance.

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The FDA, an agency within the U.S. Department of Health and Human Services, protects the public health by assuring the safety, effectiveness, and security of human and veterinary drugs, vaccines and other biological products for human use, and medical devices. The agency also is responsible for the safety and security of our nation’s food supply, cosmetics, dietary supplements, products that give off electronic radiation, and for regulating tobacco products.