Providers of 401(k)s and other participant-directed individualretirement account plans will have a two-month grace period toprovide annual fee disclosures, the Department of Labor's EmployeeBenefits Security Administration announced on Wednesday. Thesubject of the disclosures, however, is the same.

Under the current definition, plan administrators must provideannual fee and expense disclosures no later than exactly 12 monthsafter a participant received the initial disclosure. EBSA, part ofthe Department of Labor, changed the rule to require disclosures toparticipants at least once every 14 months in response to commentsfrom organizations that represent employers, plans, recordkeepersand other service providers.

Among the comments received by the department is that thecurrent definition requires plan administrators to track thespecific date a participant received his or her disclosureplan-by-plan or participant-by-participant basis. Large plans mayhave tens of thousands of participants, though.

Other commenters raised concerns that many sponsors and serviceproviders try to consolidate disclosures to prevent overwhelmingparticipants, but the current definition hindered their ability todo so.

Furthermore, some commenters argued that flexibility in feedisclosure actually benefited participants, by expediting somematerials or avoiding conflicts when new investment options arebeing considered.

Plan administrators must still make participant disclosureswithin the new time frame regardless of whether the plan operateson a calendar year or fiscal year basis. The rule will be publishedin the Federal Register on Thursday and will take effect June 17unless commenters express widespread opposition.

In the announcementof the amended rule, the department also asked whether thedefinition of “at least quarterly” needed to be changed as well. Nocommenters suggested such a change was necessary, according toEBSA, but the department suggested that might be because FieldAssistance Bulletin 2006-03 allows plans a 45-day window to providequarterly benefit statements to participants, and Field AssistanceBulletin 2012-02R allows fee disclosures to be made along withbenefit statements.

EBSA may consider withdrawing the revised definition if enoughcommenters object. Comments should be made by using the FederaleRulemaking Portal, http://www.regulations.gov;emailing [email protected] and including “RIN1210-AB68” in the subject line; or mailing comments to Office ofRegulations and Interpretations, Employee Benefits SecurityAdministration, Room N-5655, U.S. Department of Labor, 200Constitution Avenue, NW, Washington, DC 20210.