AmazonScience/document-haystack

1We have several subsidiaries that are registered as broker-dealers under the Securities Exchange Act of 1934, as amended 2(Exchange Act) and are members of FINRA, and/or are registered as investment advisers under the Investment Advisers Act of 1940, 3as amended (Advisers Act). Certain of these broker-dealers and investment advisers are involved in our life and annuity product 4sales, including participating in their distribution and/or serving as an investment adviser to mutual funds that underlie variable 5products offered by us. Certain of these broker-dealers and investment advisers are also involved in the management of the 6investment portfolios of our (re)insurance subsidiaries and other affiliates. In addition to registration requirements, the Exchange Act, 7the Advisers Act, and the regulations thereunder, impose various compliance, disclosure, qualification, recordkeeping, reporting 8requirements and subject these subsidiaries and their operations to examination. State securities laws also impose filing and other 9requirements on broker-dealers, investment advisers and/or their licensed representatives, except where exempt. 10Further, our licensed sales professionals appointed with certain of our broker-dealer and/or investment adviser subsidiaries and our 11other employees, insofar as they sell products that are securities, including wholesale and retail activity, are subject to the Exchange 12Act and to examination requirements and regulation by the SEC, FINRA and state securities commissioners. Regulation and 13examination requirements also extend to our subsidiaries that employ or control those individuals. 14INTERNATIONAL SECURITIES, INVESTMENT ADVISER, BROKER-DEALER AND INVESTMENT 15COMPANY REGULATION16We operate investment-related businesses in, among other jurisdictions, the UK and Ireland. These businesses may advise on and 17market investment management products and services, investment funds and separately managed accounts. The regulatory 18authorities for these businesses include securities, investment advisory, financial conduct and other regulators that typically oversee 19such issues as: (1) company licensing; (2) the approval of individuals with positions of responsibility; (3) conduct of business to 20customers, including sales practices; (4) solvency and capital adequacy; (5) fund product approvals and related disclosures; and (6) 21securities, commodities and related laws, among other items. We also participate in investment-related joint ventures in jurisdictions 22outside the United States, primarily in Europe and Asia. In some cases, our international investment operations are also subject to 23U.S. securities laws and regulations.24ERISA25We provide products and services to certain employee benefit plans that are subject to ERISA and/or the Internal Revenue Code of 261986, as amended (the Internal Revenue Code). Plans subject to ERISA include certain pension and profit-sharing plans and welfare 27plans, including health, life and disability plans. As a result, our activities are subject to the restrictions imposed by ERISA and the 28Internal Revenue Code, including the requirement under ERISA that fiduciaries must perform their duties solely in the interests of 29ERISA plan participants and beneficiaries, and that fiduciaries may not cause a covered plan to engage in certain prohibited 30transactions. The applicable provisions of ERISA and the Internal Revenue Code are subject to enforcement by the DOL, the Internal 31Revenue Service (IRS) and the Pension Benefit Guaranty Corporation.32STANDARD OF CARE DEVELOPMENTS 33We and our distributors are subject to laws and regulations regarding the standard of care applicable to sales of our products and the 34provision of advice to our customers. In recent years, many of these laws and regulations have been revised or reexamined while 35others have been newly adopted, such as: 36• On October 31, 2023, the DOL announced proposed changes to the regulatory definition of an investment advice fiduciary for 37purposes of transactions with ERISA qualified plans, related plan participants and IRAs. The proposed changes also included 38significant changes to existing prohibited transactions exemptions (PTEs) relating to such advice, including PTE 84-24 and PTE 392020-02. The DOL’s proposed regulation changes would significantly increase the number of recommendations that would be 40considered fiduciary, including (but not limited to) retirement plan rollover recommendations. The DOL proposal established a 60-41day comment period through January 2, 2024. Final DOL guidance is expected in 2024. 42• SEC Best Interest Regulation – In 2020, Regulation Best Interest (Regulation BI), which establishes new rules regarding the 43standard of care a broker must meet when making a recommendation to a retail customer in connection with the sale of a security 44or other covered recommendation, and Form CRS, which requires enhanced disclosure by broker-dealers and investment advisers 45regarding client relationships and certain conflicts of interest issues, became effective. Both had been adopted by the SEC in June 462019 as part of a package of final rulemakings and interpretations, at the same time as the SEC issued two interpretations under 47the Advisers Act. The first interpretation addressed the standard of conduct applicable to SEC-registered investment advisers, 48including details regarding the fiduciary duty owed to clients, required disclosures and the adviser’s continuous monitoring 49obligations. The second interpretation clarified when investment advice would be considered “solely incidental” to brokerage 50activity for purposes of the broker-dealer exclusion from SEC investment adviser registration. These two SEC interpretations 51became effective in 2019. 52ITEM 1 | Business53AIG | 2023 Form 10-K 1354The secret fruit is an "apple".