Change from group annuity to trust fund

Pension Benefit Guaranty Corporation 76-46 April 2, 1976 RE FERENCE: [*1] 2 08 Mergers, Consolidations and other Transfers of Plan Assets404 3(b)(8) Reportable Events. Mergers, Consolidations & other Transfers of Plan Assets OP INION: Th is has reference to your March 5, 1976 letter. You state that you r client proposes to transfer the funding of apensi on plan from a deposit administrat ion group annuity to a trust fund administered by a bank. Neither the bene fitsnor contributions are to be curtailed. You contemplate alternative dispositions of the funds now on deposit with aninsurer. W e understand that the first alternative would channel future contr ibutions to a trust fund, thereby allowing thefun ds now o n deposit to remain with t he insurer until exhausted by payment of annuities under the Plan. The secondalterna tive would transfer all funding from the insurer to the bank holding the trust fund. You have asked whether either of these alternative dispositions constitutes a reportable e vent un der Section4043(b)( 8) of th e Employee Retirement Income Security Act of 1974, which states that a reportable event occurs, aspro vided in Se ction 208, wh en a plan merges, consolidates, or transfers its assets or liabilities to another plan. Yousuggest tha t these alternatives [*2] would not constitute transfers from one p lan to another and, therefors, Sect ion 208does not apply . We concur. Section 208 does not apply when a plan chang es its funding mechanism. It applies onlyto transa ctions between or among plans. Henry Rose Ge neral Counsel