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of such unions serve on the board of trustees administering the plan, the Department emphasizes that the exemption, as adopted, does not contain relief from section 406(b) of the Act. In this regard, the Department has received comments which urge that the proposed exemption be expanded to in-. clude relief from the prohibition of section 406(b) (2) of the Act. Section 406 (b) (2) prohibits a fiduciary with respect to a plan from acting, in his individual or in any other capacity, in any transaction involving the plan on behalf of a party (or representing a party) whose interests are adverse to the interests of the plan or the interests of its participants or beneficiaries.

Exemption from section 406(b) is not necessary for many of the transactions in which apprenticeship plans purchase or lease property from parties in interest because such transactions are with parties who are not fiduciaries and do not involve the approving fiduciary in transactions which would be prohibited by section 406(b). Moreover, section 408(a) of the Act states that the Department may not grant an exemption from section 406(b) of the Act without affording an opportunity for a hearing. Such a hearing with respect to this exemption would further delay its adoption in final form. Consequently, for these reasons, the Department has determined to adopt the exemption without providing relief from section 406(b) of the Act. Interested persons may wish to bring to the attention of the Department, by application in accordance with the proce

dure established in ERISA Proc. 75-1 (40 FR 18471, April 28, 1975), as amended (42 FR 57183, November 1, 1977), their views as to whether the exemption, as adopted, should be amended to include relief from any of the prohibitions of section 406(b) of the Act, and, if so, the reasons therefor.

With respect to the absence of relief from section 406(b) of the Act, the Department notes the following. Section 406(b) (1) of the Act prohibits a

fiduciary of a plan from dealing with the assets of a plan in his own interest or for his own account. It would constitute a prohibited transaction under section 406 (b) (1) of the Act for a trustee of an apprenticeship plan who was, for example, an employee, officer, director or other affiliate of a contributing employer to participate in a decision of the plan to purchase or lease property from such contributing employer. Similarly, a trustee of a plan who was a member or officer of the union sponsoring the plan would engage in an act described in section 406 (b) (1) of the Act by participating in a decision of the plan to lease property from such union. However, by removing himself from all consideration by the plan whether or not to engage in the transaction and by not otherwise exercising any of the authority, control or responsibility which makes him a fiduciary to cause the plan to engage in the transaction, the trustee (who is associated with the contributing employer or sponsoring employee organization selling or leasing the property to the plan) could avoid engaging in a section 406(b) (1) prohibited transaction.

GENERAL INFORMATION

The attention of interested persons is directed to the following:

(1) The fact that a transaction is the subject of an exemption granted under section 408(a) of the Act does not relieve a fiduciary or party in interest with respect to a plan to which the exemption is applicable from certain other provisions of the Act including any prohibited transaction provisions to which the exemption does not apply and the general fiduciary responsibility provisions of section 404 of the Act which require, among other things, that a fiduciary discharge his duties respecting the plan solely in the interests of the participants and beneficiaries of the plan and in a prudent fashion in accordance with section 404 (a) (1) (B) of the Act;

(2) This exemption does not extend to transactions prohibited under sections 406(a) (1) (B) and (E), 406 (a) (2) or 406(b) of the Act; and

(3) This exemption is supplemental to, and not in derogation of, any other provisions of the Act, including statutory or administrative exemptions and transitional rules. Furthermore, the fact that a transaction is subject to an administrative or statutory exemption or transitional rule is not dispositive of whether the transaction is in fact a prohibited transaction.

EXEMPTION

In accordance with section 408(a) of the Act and the procedures set forth in ERISA Proc. 75-1 (40 FR 18471, April 28, 1975), and based upon the entire record, the Department makes the following determinations: (a) the exemption is administratively feasible; (b) the exemption is in the interests of the plans affected and their participants and beneficiaries; and (c) the exemption is protective of the rights of participants and beneficiaries of the affected plans. Accordingly, the following exemption is granted, effective January 1, 1975, under the authority of section 408 (a) of the Act and in accordance with the procedures set forth in ERISA Proc. 75-1.

Section 1.-Transactions Covered by this Exemption. (a) The purchase of personal property by a multiple employer welfare benefit plan maintained for the purpose of providing apprenticeship or other training programs (hereinafter referred to as an apprenticeship plan) from an employer who makes contributions to such plan (hereinafter referred to as a contributing employer) or from a wholly owned subsidiary of such an employer.

(b) The leasing of personal property by an apprenticeship plan from a contributing employer or from a wholly owned subsidiary of such an employer.

(c) The leasing of real property (other than office space within the contemplation of section 408(b) (2) of the Act) by an apprenticeship plan from a contributing employer, a wholly owned subsidiary of such an employer, or from an employee organization any of whose members' work results in contributions being made to the apprenticeship plan (hereinafter referred to as a sponsoring employee organization).

(d) The leasing of personal property incidental to the leasing of real property by an apprenticeship plan from a sponsoring employee organiza

tion.

Section II. Conditions. The transactions described in section I above are exempt only if:

(a) The transaction is on terms at least as favorable to the plan as an arm's-length transaction with an unrelated party would be;

(b) The transaction is appropriate and helpful in carrying out the purposes for which the plan is established or maintained;

(c) The apprenticeship plan which enters into any of the transactions described in section I above maintains or causes to be maintained for a period of 6 years from the termination of any such transaction such records as are necessary to enable the persons described in paragraph (d) of this section to determine whether the conditions of this exemption have been met, except that:

(1) This paragraph (c) and paragraph (d) below will not apply to transactions effected prior to July 24, 1978, and

(2) A prohibited transaction will not be deemed to have occurred, if due to circumstances beyond the control of the fiduciaries of such apprenticeship plan, such records are lost or destroyed prior to the end of the 6-year period; and

(d) Notwithstanding any provisions of subsections (a) (2) and (b) of section 504 of the act, the records referred to in paragraph (b) of this section are unconditionally available at their customary location for examination during normal business hours by (1) the

Department of Labor, (2) any contributing employer, (3) any employee of a contributing employer, (4) any sponsoring employee organization, (5) any person receiving benefits under the apprenticeship plan, and (6) any duly authorized employee or representative of a person described in (1) through (5) of this paragraph.

Section III.-Definitions. For purposes of this exemption the term "multiple employer welfare benefit plan" means a welfare plan which is a multiemployer plan within the meaning of section 3(37) of the Act, or a welfare plan which meets the requirements of at least subsection 3 (37) (A) (i), (ii) and (v) of the Act.

Signed at Washington, D.C., this 24th day of May 1978.

Prohibited Transaction Exemption 78-7

DEPARTMENT OF LABOR

the exemptions, would be prohibited by the Employee Retirement Income Security Act of 1974 (the Act) [Pub. L. 93-406, 1974-3 C.B. 1] and the Internal Revenue Code of 1954 (the Code).

FOR FURTHER INFORMATION CONTACT: Robert R. Bitticks, Esq., Office of the Solicitor, Plan Benefits Security Division, Room C-4508, U.S. Department of Labor, 200 Constitution Avenue, N.W., Washington, D.C. 20210, (202) 523-8620. (This is not a toll free number).

SUPPLEMENTARY INFORMATION: On April 21, 1978, notice was published in the Federal Register (43 FR 17067) of the pendency before the Department of Labor and the Internal Revenue Service (the Agencies) of two exemptions from the restrictions of sections 406(a) and 407 (a) of the Act and from the taxes imposed by sections 4975(a) and (b) of the Code

Pension and Welfare Benefit Programs by reason of sections 4975(c) (1) (A)

DEPARTMENT OF THE

TREASURY

Internal Revenue Service EMPLOYEE BENEFIT PLANS

Exemptions from the Prohibitions
Respecting Transactions Involving the
Southern Nevada Culinary and
Bartenders Pension Trust
(Application No. D-964)

AGENCIES: Department of Labor
Department of the
Treasury/
Internal Revenue
Service

ACTION: Grant of individual exemptions

SUMMARY: These two exemptions enable the Upper Avenue Bank (the Bank), as an investment manager of the Southern Nevada Culinary and Bartenders Pension Trust (the Pension Trust) to engage in certain transactions which, in the absence of

through (D) of the Code. The exemptions were requested in an application filed by the Bank pursuant to section 408(a) of the Act and section 4975 (c) (2) of the Code. The proposed exemptions would apply to a number of transactions which involve the Bank, the Pension Trust and certain parties in interest and disqualified persons and which have been or would be entered into as a result of the Bank's appointment as investment manager on August 30, 1977. The notice set forth a summary of the facts and representations contained in the application and referred interested persons to the application for a complete statement of the facts and representations. The application has been available for public inspection at the Agencies in Washington, D.C. The notice also invited interested persons to submit comments on the requested exemptions to the Department of Labor (the Department). Three letters of comment were received. One letter noted that a sentence in the summary of representations at 43 FR 17069 contained a misstatement. The sentence stated that, "Most employers contributing to the Pension Trust are members of the Nevada Resort Own a transaction described in an application submitted by the trustees of the Plan. The notice set forth a summary of the facts and representations contained in the application for exemption, and referred intrested persons to the application for the complete statement of the facts and representations.

ers Association whose membership also includes other resort owners in the state of Nevada." The comment letter pointed out that the organization's name is the Nevada Resort Association, that it has only 27 members, and that most of the 253 employers of participants in the Pension Trust are not members of the Association. The letter noted, however, that it "is probably true that most of the participants in the Pension Trust are or were employees of members of the Nevada Resort Association." The other two letters objected, in general terms, to the granting of any exemption to permit the Pension Trust to deal with the parties in interest and disqualified persons identified in the preamble to the proposed exemptions.

Based on the application for exemption submitted by the Bank and the three public comments received, the Agencies have decided to grant the proposed exemptions.

General Information

The attention of interested persons is directed to the following:

(1) The fact that a transaction is the subject of an exemption under section 408(a) of the Act and section 4975 (c) (2) of the Code does not relieve a fiduciary or other party in interest or disqualified person from certain other provisions of the Act and the Code, including any prohibited transaction provisions to which the exemption does not apply and the general fiduciary responsibility provisions of section 404 of the Act, which require, among other things, that a fiduciary discharge his duties respecting the plan solely in the interests of the participants and beneficiaries of the plan and in a prudent fashion in accordance with section 404(a) (1) (B) of the Act; nor does it affect the requirement of section 401 (a) of the

Code that the plan must operate for the exclusive benefit of the employees of the employer maintaining the plan and their beneficiaries;

(2) These exemptions do not extend to transactions prohibited under section 406 (b) of the Act and section 4975(c) (1) (E) and (F) of the Code;

(3) These exemptions are supplemental to, and not in derogation of, any other provisions of the Act and the Code, including statutory or administrative exemptions and transitional rules. Furthermore, the fact that a transaction is subject to an administrative or statutory exemption is not dispositive of whether the transaction is in fact a prohibited transaction.

(4) This document does not meet the criteria for significant regulations set forth in paragraph 8 of the proposed Treasury directive appearing in the Federal Register for Wednesday, May 24, 1978 (43 FR 22319).

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The availability of these exemptions is subject to the express conditions that the material facts and representations contained in the application are true and complete.

Signed at Washington, D.C., this 26 day of June, 1978.

Prohibited Transaction Exemption 78-8

DEPARTMENT OF LABOR

Pension and Welfare Benefit Programs

Exemption from the Prohibitions Relating to a Transaction Involving the Heavy and General Laborers' Welfare Fund of New Jersey

AGENCIES: Department of Labor ACTION: Grant of individual exemption

SUMMARY: This document contains a grant of an exemption by the Department of Labor (the Department) from the prohibited transaction restrictions of the Employee Retirement Income Security Act of 1974 (the Act), Pub. L. 93-406, 1974-3 C.B. 1. The exemption would allow the purchase by the Heavy and General Laborers' Welfare Fund of New Jersey (the Plan) of a parcel of property from the Heavy and General Laborers' Local No. 472 (the Union).

FOR FURTHER INFORMATION CONTACT: Stephen Elkins of the Office of Regulatory Standards and Exceptions, Pension and Welfare Benefit Programs, Room C-4526, U.S. Department of Labor, 200 Constitution Avenue, N.W., Washington, D.C. 20216, (202) 523-8196. (This is not a toll-free number.)

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On March 21, 1978, notice was published in the Federal Register (43 FR 55), correcting a typrographical error which appeared in the notice of pendency published on October 25, 1977.

The application has been available for public inspection at the Department in Washington, D.C. The notice also invited interested persons to submit comments on the requested exemption to the Department. In addition, the notice stated that any interested person might submit a written request that a hearing be held relating to the requested exemption. No comments and no requests for a public hearing were received by the Depart

ment.

General Information

The attention of interested persons is directed to the following:

(1) The fact that a transaction is the subject of an exemption granted under section 408(a) of the Act does not relieve a fiduciary or other party in interest with respect to a plan to which the exemption is applicable from certain other provisions of the Act, including any prohibited transaction provisions to which the exemption does not apply and the general fiduciary responsibility provisions of section 404 of the Act which, among other things, require that a fiduciary discharge his duties respecting the plan solely in the interests of the participants and beneficiaries of the plan and in a prudent fashion in accordance with section 404 (a) (1) (B) of the Act;

(2) The exemption does not extend to transactions prohibited under section 406(b) (1) and (b) (3) of the Act;

(3) The exemption is supplemental to, and not in derogation of, any other provisions of the Act, including statutory or administrative exemptions and transitional rules. Furthermore, the fact that a transaction is subject to an administrative or statutory exemption or transitional rule is not dispositive of whether the transaction is in fact a prohibited transaction;

(4) In accordance with section 408 (a) of the Act and the procedure set forth in ERISA Procedure 75-1 (40 FR 18471, April 28, 1975) and based upon the entire record, the Department makes the following determinations:

Prohibited Transaction Exemption 78-9

DEPARTMENT OF

THE TREASURY
Internal Revenue Service
DEPARTMENT OF LABOR

Pension and Welfare Benefit Programs Exemption from the Prohibitions Respecting a Transaction Involving the Pension Plan and Trust of Endodontic Associates, P.A.

AGENCIES: Department of the Treasury/Internal Revenue Service, Department of Labor

(i) The exemption is administra- ACTION: Grant of individual extively feasible;

(ii) The exemption is in the interests of the Plan and of the participants and beneficiaries of the Plan;

and

(iii) The exemption is protective of the rights of participants and beneficiaries of the Plan.

Exemption

Accordingly, the following exemption is hereby granted under the authority of section 408(a) of the Act and in accordance with the procedures set forth in ERISA Procedure 75-1.

The restrictions of section 406(a) (1) and 406(b) (2) of the Act shall not apply to the purchase by the Plan of a certain parcel of property from the Union, subject to the terms, conditions, and representations set forth in the application.

The availability of this exemption is subject to the express conditions that the material facts and representations contained in the application are true and complete, and that the application accurately describes all material terms of the transaction to be consummated pursuant to the exemption.

Signed at Washington, D.C., this 30th day of June, 1978.

emption

SUMMARY: This exemption enables the Pension Trust of Endodontic Associates, P.A. (the Trust) to sell certain Trust assets to Dr. William N.

Gressette, an officer and stockholder of Endodontic Associates (the Employer) and sole trustee of the Trust.

FOR FURTHER INFORMATION CONTACT: Timothy Smith of the Prohibited Transactions Staff of the Employee Plans Division, Internal Revenue Service, 1111 Constitution Avenue, N.W., Washington, D.C. 20224 (Attention: E:EP:PT:1) (202-566-6761). This is not a toll free number.

SUPPLEMENTARY
INFORMATION

On April 18, 1978, notice was published in the Federal Register (43 FR 16437) of the pendency before the Internal Revenue Service and the Department of Labor (the Agencies) of an exemption from the taxes imposed by section 4975(a) and (b) of the Internal Revenue Code of 1954 (the Code) by reason of section 4975(c) (1) (A) through (E) of the Code and from the provisions of section 406(a) (1), 406(b) (1) and 406(b) (2) of the Employee Retirement Income Security Act of 1974 (the Act), Pub.

L. 93-406, 1974-3 C.B. 1, for a transaction described in an application submitted by the trustee of the Trust. The notice set forth a summary of the facts and representations contained in the application for exemption and referred interested persons to the application for a complete statement of the facts and representations. The application has been available for public inspection at the Agencies in Washington, D.C. The notice also invited interested persons to submit comments on the requested exemption to the Internal Revenue Service (the Service). In addition, the notice stated that any interested person might submit a written request that a hearing be held relating to this exemption. No public coinments and no requests for a hear ing were received by the Service.

GENERAL INFORMATION

The attention of interested persons is directed to the following:

(1) The fact that a transaction is the subject of an exemption granted under section 4975(c) (2) of the Code and section 408(a) of the Act does not relieve a fiduciary or party in interest or disqualified person with respect to a plan to which the exemption is applicable from certain other provi

sions of the Code and the Act. These provisions include any prohibited transaction provisions to which the exemption does not apply and the general fiduciary responsibility provisions of section 404 of the Act, which among other things require a fiduciary to discharge his duties respecting the plan solely in the interests of the participants and beneficiaries of the plan and in a prudent fashion in accordance with subsection (a) (1) (B) of section 404 of the Act, nor does the fact the transaction is the subject of an exemption affect the requirement of section 401 (a) of the Code that a plan must operate for the exclusive benefit of the employees of the employer maintaining the plan and their beneficiaries.

(2) This exemption does not extend to transactions prohibited under section 4975 (c) (1) (F) of the Code and section 406(b) (3) of the Act.

(3) This exemption is supplemental to, and not in derogation of, any other provisions of the Code and the Act, including statutory or administrative exemptions and transitional rules. Furthermore, the fact that a transaction is subject to an administrative or statutory exemption or transitional rule is not dispositive of whether the transaction is in fact a prohibited transaction.

approximately 3.18 acres of land on Howard Drive, Greenville, S.C., by the Trust to Dr. Gressette, for $8,000 cash, provided that this amount is not less than the fair market value of the property.

The availability of this exemption is subject to the express conditions that the material facts and representations contained in the application are true and complete and that the application accurately describes all material terms of the transaction consummated pursuant to the exemption.

Signed at Washington, D.C. this 10th day of July, 1978.

(4) This document does not meet the criteria for significant regulations set forth in paragraph 8 of the proposed Treasury directive appearing in the Federal Register for Wednesday, Exemption 78-10 May 24, 1978 (43 FR 22319).

EXEMPTION

In accordance with section 4975 (c) (2) of the Code and section 408(a) of the Act and the procedures set forth in Rev. Proc. 75-26, 1975-1 С.В. 722, and ERISA Proc. 75-1 (40 FR 18471, April 28, 1975), and based upon the entire record, the Agencies make the following determinations:

(a) The exemption is administratively feasible;

(b) It is in the interests of the Plan and of the participants and beneficiaries; and

(c) It is protective of the rights of participants and beneficiaries of the

Plan.

Prohibited Transaction

DEPARTMENT OF LABOR

Pension and Welfare Benefit Programs

DEPARTMENT OF

THE TREASURY

Internal Revenue Service

EXTENSION OF CLASS EXEMPTION FOR CERTAIN TRANSACTIONS INVOLVING EMPLOYEE BENEFIT PLANS AND BROKERDEALERS

Prohibited Transaction Exemption AGENCIES: Department of Labor, Department of the Treasury/Internal Revenue Service.

ACTION: Grant of extension of class

Accordingly, the following exemption is hereby granted under the authority exemption. of section 4975 (c) (2) of the Code and section 408(a) of the Act and in accordance with the procedures set forth in Rev. Proc. 75-26 and ERISA Proc. 75-1.

The taxes imposed by section 4975 (a) and (b) of the Code by reason of section 4975 (c) (1) (A) through (E) of the Code and the restrictions of section 406(a) (1), 406(b) (1) and 406(b) (2) of the Act shall not apply to a transaction involving the sale of

SUMMARY: This document contains a notice by the Department of Labor and the Internal Revenue Service (hereinafter referred to collectively as the Agencies) of the grant of an extension until February 1, 1979 of that portion of a previously granted class exemption which permitted securities broker-dealers, until May 1, 1978, to provide brokerage and incidental services, under certain circumstances,

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