Subject to subchapter II and section 1029 of this title, the Secretary may prescribe such regulations as he finds necessary or appropriate to carry out the provisions of this subchapter. Among other things, such regulations may define accounting, technical and trade terms used in such provisions; may prescribe forms; and may provide for the keeping of books and records, and for the inspection of such books and records (subject to section 1134(a) and (b) of this title).
29 U.S. Code § 1135. Regulations
“(a) Regulatory Treatment of Assets of Real Estate Entities.—
“(1)In general.—Except as a defense, no rule or regulation adopted pursuant to the Secretary’s proposed regulation defining ‘plan assets’ for purposes of the Employee Retirement Income Security Act of 1974 [29 U.S.C. 1001 et seq.] (50 Fed. Reg. 961, January 8, 1985, as modified by 50 Fed. Reg. 6361, February 15, 1985), or any reproposal thereof prior to the adoption of the regulations required to be issued in accordance with subsection (d), shall apply to any asset of a real estate entity in which a plan, account, or arrangement subject to such Act invests if—
any interest in the entity is first offered to a plan, account, or arrangement subject to such Act investing in the entity (hereinafter in this section referred to as a ‘plan investor’) on or before the date which is 120 days after the date of publication of such rule or regulation as a final rule or regulation;
no plan investor acquires an interest in the entity from an issuer or underwriter at any time on or after the date which is 270 days after the date of publication of such rule or regulation as a final rule or regulation (except pursuant to a contract or subscription binding on the plan investor and entered into, or tendered, before the expiration of such 270-day period, or pursuant to the exercise, on or before December 31, 1990, of a warrant which was the subject of an effective registration under the Securities Act of 1933 (15 U.S.C. 77q et seq.) [15 U.S.C. 77a et seq.] prior to the date of the enactment of this section [Apr. 7, 1986]); and
“(C) every interest in the entity acquired by a plan investor (or contracted for or subscribed to by a plan investor) before the expiration of such 270-day period is a security—
which is part of an issue or class of securities which upon such acquisition or at any time during the offering period is held by 100 or more persons;
the economic rights of ownership in respect of which are freely transferable;
which is registered under the Securities Act of 1933; and
which is part of an issue or class of securities which is registered under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) (or is so registered within three years of the effective date of the registration statement of such securities for purposes of the Securities Act of 1933: Provided, That the issuer provides plan investors with such reports with respect to the offering period as are required with respect to such period by the Securities and Exchange Commission under such Acts and the rules and regulations promulgated thereunder).
In the case of partnerships organized prior to enactment of this section, the requirements of subparagraphs (iii) and (iv) shall not apply to initial limited partnership interests in an entity otherwise described above: Provided, That such entity was the subject of an effective registration under the Securities Act of 1933 prior to the date of the enactment of this section, such interests were issued solely for partnership organizational purposes in compliance with State limited partnership laws, and such interest has a value as of the date of issue of less than $20,000 and represents less than one percent of the total interests outstanding as of the completion of the offering period.
“(2)Maintenance of current regulatory treatment.—No asset of any real estate entity described in paragraph (1) shall be treated as an asset of any plan investor for any purpose of the Employee Retirement Income Security Act of 1974 [29 U.S.C. 1001 et seq.] if the assets of such entity would not have been assets of such plan investor under the provisions of—
Interpretive Bulletin 75–2 (29 CFR 2509.750–2); or
“(B) the regulations proposed by the Secretary of Labor and published—
on August 28, 1979, at 44 Fed. Reg. 50363;
on June 6, 1980, at 45 Fed. Reg. 38084;
on January 8, 1985, at 50 Fed. Reg. 961; or
on February 15, 1985, at 50 Fed. Reg. 6361,
without regard to any limitation of any effective date proposed therein.
“(b)Definitions and Special Rules.—For purposes of this section—
The term ‘real estate entity’ means an entity which, at any time within two years after the closing of its offering period has invested or has contracted to invest at least 75 percent of the value of its net assets available for investment in direct or indirect ownership of ‘real estate assets’ or ‘interests in real property’.
The term ‘real estate asset’ means real property (including an interest in real property) and any share of stock or beneficial interest, partnership interest, depository receipt, or any other interest in any other real estate entity.
“(3) The term ‘interest in real property’ includes, directly or indirectly, the following:
the ownership or co-ownership of land or improvements thereon;
any mortgage (including an interest in or co-ownership of any mortgage, leasehold mortgage, pool of mortgages, deed of trust, or similar instrument) on land or improvements thereon,
any leasehold of land or improvements thereon; and
any option to acquire any of the foregoing, but does not include any mineral, oil, or gas royalty interest.
“(4) Whether the economic rights of ownership with respect to a security are ‘freely transferable’ shall be determined based upon all the facts and circumstances, but ordinarily none of the following, alone or in any combination, shall cause the economic rights of ownership to be considered not freely transferable—
any requirement that not less than a minimum number of shares or units of such security be transferred or assigned by any investor: Provided, That such requirement does not prevent transfer of all of the then remaining shares or units held by an investor;
any prohibition against transfer or assignment of such security or rights in respect thereof to an ineligible or unsuitable investor;
any requirement that reasonable transfer or administrative fees be paid in connection with a transfer or assignment;
any requirement that advance notice of a transfer or assignment be given to the entity and any requirement regarding execution of documentation evidencing such transfer or assignment (including documentation setting forth representations from either or both of the transferor or transferee as to compliance with any restriction or requirement described in this section or requiring compliance with the entity’s governing instruments);
any restriction on substitution of an assignee as a limited partner of a partnership, including a general partner consent requirement: Provided, That the economic benefits of ownership of the assignor may be transferred or assigned without regard to such restriction or consent (other than compliance with any other restriction described in this section);
any administrative procedure which establishes an effective date, or an event such as the completion of the offering, prior to which a transfer or assignment will not be effective; and
any limitation or restriction on transfer or assignment which is not created or imposed by the issuer or any person acting for or on behalf of such issuer.
“(c)No Effect on ’s Authority Other Than As Provided.—
“(d)Time Limit for Final Regulations.—
The preceding provisions of this section shall take effect on the date of the enactment of this Act [Apr. 7, 1986].”
Secretary authorized, effective Sept. 2, 1974, to promulgate regulations wherever provisions of this subchapter call for the promulgation of regulations, see section 1031 of this title.