Indicia of plan asset ownership abroad

P/OPINION 75-80


                                                                404


                        February 13, 1975


Dear              :

Your letter of December 12, 1974 to the          regional
office of the Labor-Management Services Administration,
in which you inquired about compliance with section 404(b)
of the Employee Retirement Income Security Act of 1974
(the Act), has been referred to me for response. Section
404(b) reads as follows:

       "except as authorized by the Secretary
       by regulation, no fiduciary may maintain
       the indicia of ownership of any assets of
       a plan outside the jurisdiction of the district
       courts of the United States."

This language indicates only that the "indicia of ownership",
i.e. evidence of ownership of plan assets (such as bonds or
stock certificates), may not be maintained outside the United
States. It does not, however, proscribe the investment of
employee benefit plan assets outside the United States. With
respect to such ownership, the Conference Report states that:

       "It is recognized that investment in
       securities of foreign companies and governments
       have been and may will continue to be in the
       best interests of plan participants in appropriate
       circumstances and with proper safeguards…

The Department of Labor is presently preparing a regulation
which will cover those situations in which it is permissible
to maintain the indicia of ownership outside the United
States.

Sincerely,