President Donald Trump's executive order directing the Labor Department to undertake a new economic and legal analysis of the fiduciary rule was immediately embraced by lawmakers and stakeholders opposed to the regulation.
In a statement issued after she attended Trump's signing of the order, Rep. Ann Wagner, R-Mo., a sponsor of bills that would have blocked the Labor Department from implementing the rule, said she applauds the president's order to "delay" the rule.
But some proponents of a fiduciary standard say language in the order offers more questions than answers as to the rule's ultimate fate.
The final executive order stripped language from an earlier draft specifically calling for a six-month delay of the rule.
In lieu of an explicit mandate to delay the rule's April 10 implementation date, the order instructs Labor to consider if that date is "likely to harm investors" by reducing access to financial advice and retirement investment products, and whether the scheduled implementation date has resulted in industry disruptions that will adversely impact retirement investors.
The order also instructs Labor to assess if the rule will create an increase in litigation, and an increase in the price of retirement investment services.
How long will the rule's new analysis take?
Rob Foregger, co-founder of NextCapital, which provides automated investment platforms for 401(k) plans and retirement advisors in the retail segment, does not think a thorough economic and legal analysis can be completed quickly.
"Given how far-reaching the rule is, and that comment periods during the rulemaking process took as long as they did, I think they will have a hard time completing a full and accurate analysis before April 10," said Foregger, who advocated for the regulation in its existing form.
Further complicating the question of timing is the fact that the Labor secretary and assistant secretary for the Employee Benefits Security Administration positions are still vacant. The confirmation hearing for Andrew Puzder, Trump's Labor nominee, has been delayed a fourth time and has yet to be rescheduled.
"I would think to complete a new analysis of the rule in the right way you would have to have the agency head in place," said Foregger. "To initiate the process without a Labor secretary would be a bad idea irrespective of who it is—it would be putting the cart before the horse."
Trump's priority: help people save for retirement
Facilitating the ability to save for retirement is a priority of the Trump administration, according to the president's executive order.
So is empowering Americans "to make their own financial decisions," the order says.
If the Labor Department's new analysis of the rule finds that it adversely impacts access to investment advice, or if the rule is found to be inconsistent with President Trump's priority to facilitate Americans' ability to save, then the order directs Labor to write a new regulation "rescinding or revising" the existing rule.
"The ultimate litmus test of the order seems to ask whether the rule is at odds with the President's populist priority of helping people save for retirement," said Blaine Aikin, executive chairman of Fi360, a provider of fiduciary compliance tools. "People have looked at this order and presumed the outcome will be a decision to rescind or replace the rule, but I'm not sure that's a layup from a practical perspective," added Aikin, a proponent of the rule.