(a) Establishment of or participation in fund by plan sponsorsThe plan sponsors of multiemployer plans may establish or participate in a withdrawal liability payment fund.
(b) DefinitionsFor purposes of this section, the term "withdrawal liability payment fund", and the term "fund", mean a trust which-
(1) is established and maintained under section 501(c)(22) of title 26,(2) maintains agreements which cover a substantial portion of the participants who are in multiemployer plans which (under the rules of the trust instrument) are eligible to participate in the fund,(3) is funded by amounts paid by the plans which participate in the fund, and(4) is administered by a Board of Trustees, and in the administration of the fund there is equal representation of-(A) trustees representing employers who are obligated to contribute to the plans participating in the fund, and(B) trustees representing employees who are participants in plans which participate in the fund.(c) Payments to plan; amount, criteria, etc.(1) If an employer withdraws from a plan which participates in a withdrawal liability payment fund, then, to the extent provided in the trust, the fund shall pay to that plan-(A) the employer's unattributable liability,(B) the employer's withdrawal liability payments which would have been due but for section 1388, 1389, 1399, or 1405 of this title,1(C) the employer's withdrawal liability payments to the extent they are uncollectible.(2) The fund may provide for the payment of the employer's attributable liability if the fund-(A) provides for the payment of both the attributable and the unattributable liability of the employer in a single payment, and(B) is subrogated to all rights of the plan against the employer.(3) For purposes of this section, the term-(A) "attributable liability" means the excess, if any, determined under the provisions of a plan not inconsistent with regulations of the corporation, of-(i) the value of vested benefits accrued as a result of service with the employer, over(ii) the value of plan assets attributed to the employer, and(B) "unattributable liability" means the excess of withdrawal liability over attributable liability.Such terms may be further defined, and the manner in which they shall be applied may be prescribed, by the corporation by regulation.
(4)(A) The trust of a fund shall be maintained for the exclusive purpose of paying-(i) any amount described in paragraph (1) and paragraph (2), and(ii) reasonable and necessary administrative expenses in connection with the establishment and operation of the trust and the processing of claims against the fund.(B) The amounts paid by a plan to a fund shall be deemed a reasonable expense of administering the plan under sections 1103(c)(1) and 1104(a)(1)(A)(ii) of this title, and the payments made by a fund to a participating plan shall be deemed services necessary for the operation of the plan within the meaning of section 1108(b)(2) of this title or within the meaning of section 4975(d)(2) of title 26.(d) Application of payments by plan(1) For purposes of this part-(A) only amounts paid by the fund to a plan under subsection (c)(1)(A) shall be credited to withdrawal liability otherwise payable by the employer, unless the plan otherwise provides, and(B) any amounts paid by the fund under subsection (c) to a plan shall be treated by the plan as a payment of withdrawal liability to such plan.(2) For purposes of applying provisions relating to the funding standard accounts (and minimum contribution requirements), amounts paid from the plan to the fund shall be applied to reduce the amount treated as contributed to the plan.(e) Subrogation of fund to rights of planThe fund shall be subrogated to the rights of the plan against the employer that has withdrawn from the plan for amounts paid by a fund to a plan under-
(1) subsection (c)(1)(A), to the extent not credited under subsection (d)(1)(A), and(2) subsection (c)(1)(C).(f) Discharge of rights of fiduciary of fund; standards applicable, etc.Notwithstanding any other provision of this chapter, a fiduciary of the fund shall discharge the fiduciary's duties with respect to the fund in accordance with the standards for fiduciaries prescribed by this chapter (to the extent not inconsistent with the purposes of this section), and in accordance with the documents and instruments governing the fund insofar as such documents and instruments are consistent with the provisions of this chapter (to the extent not inconsistent with the purposes of this section). The provisions of the preceding sentence shall supersede any and all State laws relating to fiduciaries insofar as they may now or hereafter relate to a fund to which this section applies.
(g) Prohibition on payments from fund to plan where certain labor negotiations involve employer withdrawn or partially withdrawn from plan and continuity of labor organization representing employees continuesNo payments shall be made from a fund to a plan on the occasion of a withdrawal or partial withdrawal of an employer from such plan if the employees representing the withdrawn contribution base units continue, after such withdrawal, to be represented under section 159 of this title (or other applicable labor laws) in negotiations with such employer by the labor organization which represented such employees immediately preceding such withdrawal.
(h) Purchase of insurance by employerNothing in this section shall be construed to prohibit the purchase of insurance by an employer from any other person, to limit the circumstances under which such insurance would be payable, or to limit in any way the terms and conditions of such insurance.
(i) Promulgation of regulations for establishment and maintenance of fundThe corporation may provide by regulation rules not inconsistent with this section governing the establishment and maintenance of funds, but only to the extent necessary to carry out the purposes of this part (other than section 1402 of this title).
1 So in original. Probably should be followed by "and".
Pub. L. 93-406, title IV, §4223, as added Pub. L. 96-364, title I, §104(2), Sept. 26, 1980, 94 Stat. 1241; amended Pub. L. 101-239, title VII, §7891(a), Dec. 19, 1989, 103 Stat. 2445.EDITORIAL NOTES
REFERENCES IN TEXTThis chapter, referred to in subsec. (f), was in the original "this Act", meaning Pub. L. 93-406 known as the Employee Retirement Income Security Act of 1974. Titles I, III, and IV of such Act are classified principally to this chapter. For complete classification of this Act to the Code, see Short Title note set out under section 1001 of this title and Tables.
AMENDMENTS1989-Subsecs. (b)(1), (c)(4)(B). Pub. L. 101-239 substituted "Internal Revenue Code of 1986" for "Internal Revenue Code of 1954", which for purposes of codification was translated as "title 26" thus requiring no change in text.
STATUTORY NOTES AND RELATED SUBSIDIARIES
EFFECTIVE DATE OF 1989 AMENDMENT Amendment by Pub. L. 101-239 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99-514, to which such amendment relates, see section 7891(f) of Pub. L. 101-239 set out as a note under section 1002 of this title.