PUBLIC LAW 109–280—AUG. 17, 2006
120 STAT. 969
execution of such transaction through such system or venue.’’. (2) AMENDMENTS TO INTERNAL REVENUE CODE OF 1986.— Subsection (d) of section 4975 of the Internal Revenue Code of 1986 (relating to exemptions), as amended by subsection (a), is amended by striking ‘‘or’’ at the end of paragraph (17), by striking the period at the end of paragraph (18) and inserting ‘‘, or’’, and by adding at the end the following new paragraph: ‘‘(19) any transaction involving the purchase or sale of securities, or other property (as determined by the Secretary of Labor), between a plan and a party in interest if— ‘‘(A) the transaction is executed through an electronic communication network, alternative trading system, or similar execution system or trading venue subject to regulation and oversight by— ‘‘(i) the applicable Federal regulating entity, or ‘‘(ii) such foreign regulatory entity as the Secretary of Labor may determine by regulation, ‘‘(B) either— ‘‘(i) the transaction is effected pursuant to rules designed to match purchases and sales at the best price available through the execution system in accordance with applicable rules of the Securities and Exchange Commission or other relevant governmental authority, or ‘‘(ii) neither the execution system nor the parties to the transaction take into account the identity of the parties in the execution of trades, ‘‘(C) the price and compensation associated with the purchase and sale are not greater than the price and compensation associated with an arm’s length transaction with an unrelated party, ‘‘(D) if the party in interest has an ownership interest in the system or venue described in subparagraph (A), the system or venue has been authorized by the plan sponsor or other independent fiduciary for transactions described in this paragraph, and ‘‘(E) not less than 30 days prior to the initial transaction described in this paragraph executed through any system or venue described in subparagraph (A), a plan fiduciary is provided written or electronic notice of the execution of such transaction through such system or venue.’’. (d) EXEMPTION FOR SERVICE PROVIDERS.— (1) AMENDMENTS TO EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974.—Section 408(b) of such Act (29 U.S.C. 1106), as amended by subsection (c), is amended by adding at the end the following new paragraph: ‘‘(17)(A) Transactions described in subparagraphs (A), (B), and (D) of section 406(a)(1) between a plan and a person that is a party in interest other than a fiduciary (or an affiliate) who has or exercises any discretionary authority or control with respect to the investment of the plan assets involved in the transaction or renders investment advice (within the meaning of section 3(21)(A)(ii)) with respect to those assets, solely by reason of providing services to the plan or solely by reason of a relationship to such a service provider described
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