(a) Delegation to regulated entity. An approved PEO or the plan trustees may delegate to a contracting regulated entity the responsibility to perform any requirement of this subchapter that the contracting regulated entity is authorized by law to perform.
(b) Joint and several liability. If an approved PEO or the plan trustees delegate responsibility to perform any requirement of this subchapter, TDI in its sole discretion may hold the PEO, the plan trustees, and the contracting regulated entity jointly or severally liable for noncompliance with respect to the responsibilities delegated.
(c) Notice of contract with regulated entities. An approved PEO or the plan trustees must give the commissioner a written notice of intent to enter into a contract with a regulated entity at least 30 days before the effective date of that contract. A notice of intent must include the information about the contracting regulated entity required by §13.532(b)(6) of this title (relating to Application Requirements).
(d) Notice of termination of contract with regulated entity. Except as provided in subsection (g) of this section, an approved PEO or the plan trustees must give the commissioner a written notice of intent to terminate a contract with a regulated entity at least 30 days before the effective date of that termination.
(e) Third party administrator. An approved PEO or the plan trustees may not terminate under any circumstances a contract with the plan's third party administrator unless they have contracted with a replacement third party administrator to perform the day-to-day operations of the plan with no lapse in administrative services to the plan.
(f) Notice of replacement contracting regulated entity. Except as provided in subsection (h) of this section, if an approved PEO or the plan trustees intend to enter into a contract with a regulated entity to perform the functions for which a terminating contracting regulated entity was responsible, the approved PEO or the plan trustees must provide the commissioner notice that complies with subsection (c) of this section.
(g) Notice of contract termination for cause. If an approved PEO or the plan trustees terminate a contract with a regulated entity for cause as permitted by the terms of that contract, the approved PEO or the plan trustees must give the commissioner written notice of the contract's termination not later than five days after the effective date of that termination, including a statement explaining whether the functions for which the terminating contracting regulated entity is responsible will be performed by the approved PEO or by another contracting regulated entity.
(h) Notice of intent to contract with replacement regulated entity. After a termination under subsection (g) of this section, if the plan and trust functions will be performed by another contracting regulated entity, the approved PEO or the plan trustees must give the commissioner written notice of intent to enter into a contract with that new regulated entity as soon as is practicable, but not later than 10 days after the effective date of that contract. The notice of intent must include the information about the contracting regulated entity required by §13.532(b)(6) of this title.

Source Note: The provisions of this §13.522 adopted to be effective May 17, 2016, 41 TexReg 3479