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DOL/EBSA RIN: 1210-AC20 Publication ID: Fall 2023 
Title: Worker Ownership, Readiness, and Knowledge 

The term "adequate consideration," as defined in section 3(18) of the Employee Retirement Income Security Act of 1974 (ERISA), represents a central condition of a statutory prohibited transaction exemption, at section 408(e) of ERISA, that permits an employee stock ownership plan (as defined in section 407(d)(6) of ERISA) to engage in certain transactions involving securities issued by the plan’s sponsor.  In relevant part, section 3(18)(B) of ERISA provides that in the case of an asset other than a security for which there is a generally recognized market, the term adequate consideration means the fair market value of the asset as determined in good faith by the trustee or named fiduciary pursuant to the terms of the plan and in accordance with regulations promulgated by the Secretary of Labor.  Section 346 of the SECURE 2.0 Act of 2022 directs the Secretary of Labor to establish within the Department of Labor an Employee Ownership Initiative to promote employee ownership. Section 346(c)(4)(B), in turn, provides that the Secretary of Labor, in consultation with the Secretary of the Treasury, shall issue formal guidance for acceptable standards and procedures to establish good faith fair market value for shares of a business to be acquired by an employee stock ownership plan (as defined in section 407(d)(6) of ERISA). This regulatory action relates to the Secretary of Labor’s obligations under section 346 of the SECURE 2.0 Act of 2022.


Agency: Department of Labor(DOL)  Priority: Other Significant 
RIN Status: Previously published in the Unified Agenda Agenda Stage of Rulemaking: Proposed Rule Stage 
Major: Undetermined  Unfunded Mandates: Undetermined 
CFR Citation: Not Yet Determined     (To search for a specific CFR, visit the Code of Federal Regulations.)
Legal Authority: SECURE 2.0 Act of 2022, sec. 346    ERISA sec. 3(18), 408(e)    ERISA sec. 505   
Legal Deadline:  None
Action Date FR Cite
NPRM  03/00/2024 
Regulatory Flexibility Analysis Required: Undetermined  Government Levels Affected: Undetermined 
Federalism: Undetermined 
Included in the Regulatory Plan: No 
RIN Data Printed in the FR: No 
Agency Contact:
Jeffrey J. Turner
Deputy Director, Office of Regulations and Interpretations
Department of Labor
Employee Benefits Security Administration
Room N5669, 200 Constitution Avenue NW, FP Building, Room N-5655,
Washington, DC 20210
Phone:202 693-8500