In the traditional trust environment, the trustee has the fiduciary duty to act only in the sole interests of the beneficiary. In keeping with this, transactions that generating revenue for the trustee are deemed "prohibited transactions." Simply put, trustees cannot engage the trust in any transaction which benefits the trustee. This eliminates a commonly abused conflict of interest problem from the pre-trust law days.
Investment Advisers operating under the Investment Advisers Act of 1940 ("40 Act") have always been under this same fiduciary standard. At its inception, ERISA also held its fiduciaries to this same standard. The 40 Act contained an exemption for companies where investment advice was ancillary to its main business. On the ERISA side, the DOL has promulgated opinions which allow for certain exemptions from the prohibited transaction rule.
This is how revenue sharing, including 12b-1 fees, came about.
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