Labor Gives Swiss Bank Managers a 10-Year Pass
Published Date: 5/4/2026
Notice
Summary
Starting May 5, 2026, UBS asset managers in Zurich can keep using a special exemption until May 5, 2035, even after some legal troubles. This helps retirement plans work smoothly with UBS managers while making sure they play fair and follow the rules. If plans want to stop working with UBS, they can do so without big costs or headaches.
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Analyzed Economic Effects
7 provisions identified: 7 benefits, 0 costs, 0 mixed.
UBS Managers Keep Exemptive Relief
If your workplace retirement plan or IRA uses UBS asset managers, those UBS qualified professional asset managers (QPAMs) can rely on Prohibited Transaction Exemption 84-14 from May 5, 2026 through May 5, 2035 even though some UBS affiliates had convictions and a 2025 non-prosecution agreement. That means plans that want to keep UBS as their manager can continue doing so under this exemption.
Orderly, Cost‑Effective Manager Exit
The exemption ensures a Covered Plan can terminate its relationship with a UBS QPAM in an orderly and cost-effective fashion if the plan fiduciary decides that is prudent. This is intended to help plans avoid the financial and operational costs of a rushed or disruptive manager transition.
Two Independent Audits Required
UBS QPAMs must complete two independent exemption audits during the exemption term: one covering May 5, 2029 through May 4, 2030 to be completed by November 4, 2030, and a second covering May 5, 2034 through May 5, 2035 to be completed by November 5, 2035. These audits are intended to confirm compliance with the exemption's terms and fiduciary duties.
Indemnification to Protect Plans
The exemption requires UBS QPAMs to indemnify Covered Plans for actual losses that result directly from violations of the exemption's terms. That indemnification is intended to allow plan fiduciaries to seek a new manager without fearing large charges tied to leaving UBS.
Limits on Using Misconduct Entities
During the exemption period, no Affiliated QPAM may cause an investment fund for Covered Plans to enter into a transaction with a Misconduct Entity or hire a Misconduct Entity to provide services for fees paid by the fund. Also, Misconduct Entities may not act as fiduciaries for ERISA-covered plan or IRA assets except for plans for their own employees.
Mandatory Policies, Training, and Compliance
Affiliated UBS QPAMs must maintain and follow written policies, provide specialized QPAM training, run compliance checks, and ensure filings and communications are accurate and complete so asset-management decisions are independent of UBS corporate business activities. These conditions are meant to protect plan participants by ensuring UBS QPAMs follow ERISA fiduciary duties.
Clients Must Be Notified of Violations
UBS QPAMs are required to send a Violation Notice to plan clients if the QPAM materially fails to comply with a condition of the exemption. This gives plan fiduciaries timely information to make prudent decisions about retaining or replacing the manager.
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