The U.S. Department of Labor has delayed the issuance of a new fiduciary rule for broker-dealers and advisors to retirement plans until next January, according to a DOL notice issued Tuesday.

The rule, which has been years in the making, was expected to be released in August.

The rule would extend fiduciary status to those giving advice about employer-sponsored retirement plans and IRAs. When it was first proposed in 2010, the changes sparked harsh criticism among financial industry advocates.

Critics have said it will limit the amount of advice retirement account holders can receive, especially those with small accounts. Industry representatives also said it might drive broker-dealers out of the retirement plan market by limiting commissions and revenue sharing.

The DOL originally proposed the change as a way to protect retirement plan holders from receiving conflicted advice about their accounts.

The situation became more complicated by the fact that the SEC also is considering changes to its fiduciary rules. Many in the financial industry have advocated for the SEC to take the lead in the rules battle, rather than having two sets of rules from two agencies.

Kenneth E. Bentsen Jr., president and CEO of the Securities Industry and Financial Markets Association (Sifma), welcomed the delay.

“From day one, this has been a troubled proposal by DOL that will harm the ability of everyday American investors and small business owners to save for retirement,” Bentson said. “While this extended timeline provides a temporary delay, we believe that it is the responsibility of the SEC to act, under the authority provided to them by the Dodd-Frank Act.

“Premature actions by the DOL, whether now or in January, could undermine the SEC’s work to improve upon the standard of conduct owed by broker-dealers and investment advisors to retail clients,” he added. “Any proposal moving forward should appropriately reflect the input of all market participants and continue to protect investor choice and access to investment guidance.”

Christopher J. Paulitz, senior vice president membership and marketing of the Financial Services Institute, also had no problem with the delay. “Our main goal is that they get the rule right, not get it out fast,” he said. “We remain eager to be helpful to the department to ensure small investors can continue to have access to affordable, objective financial advice.”

Cathy Weatherford, president and CEO of the Insured Retirement Institute (IRI), also expressed doubts about the need for the proposed change.

“IRI continues to be concerned that a forthcoming rule proposal from the DOL could have unintended consequences that would ultimately deprive lower- and middle-income Americans from accessing affordable retirement planning services and advice,” Weatherford said. “This new rulemaking timetable will provide more time and a new opportunity to work with the Administration to ensure that no rule proposal will prevent access to the important advice provided to Americans by their financial advisors. By working together, we can protect the client-advisor relationship and help ensure that all Americans have the opportunity to attain a financially secure and dignified retirement.”

Advocacy groups such as the U.S. Hispanic Chamber of Commerce have come out against the rule change. A recent study by the Chamber and Greenwald & Associates showed that nearly one third of small businesses say they may eliminate their employees’ retirement plans if new DOL fiduciary rule is enacted.

“The findings presented here show that the DOL expansion of fiduciary status will only impede the ability of small firms to offer their employees retirement-plan accounts, thus hindering American workers from saving for a reliable future,” says Javier Palomarez, president and CEO of the Hispanic Chamber of Commerce.

In January, 30 Congressional members of the New Democrat Coalition wrote to Labor Secretary Thomas Perez and expressed their concerns about rule change. Perez has said he will work with Congress and other organizations on their concerns. No reason was given for the delay in the DOL rule notice.

Once the rule is issued, there is a mandatory comment period and potentially public hearings before it goes into effect.