Regulatory Update – Amendments to PRIIPs Regulation

11th December 2018 3219 - Blog Posts - Regulatory Updates

We are here to help you reduce risk and stay compliant. In our latest Regulatory Update, we review the Joint Consultation Paper JC 2018 produced by European Supervisory Authorities (ESAs) on the Amendments to PRIIPs KIDs Regulation.

The ESAs have drafted a consultation paper welcoming comments from the fund industry regarding a set of possible changes to the Priips regulation. The deadline is short, responds on the proposals need to communicated before December 6, 2018. In this contribution Lawson Conner gives its view on the different topics lined out in the consultation paper.

To our surprise no suggestions were made regarding the calculation of transaction costs. Nor was there any mention on a possible delay of the plan to bring UCITS funds into the Priips regulation from January 1, 2019 onwards. How will this affect PRIIPs KIDs?

The focus in this consultation paper seemed to be on the calculation of the performance scenarios and the way these numbers could be better presented in a KID document. Priips manufacturers have indeed raised concerns that the performance scenarios risk providing retail investors with inappropriate expectations about the possible returns they may receive.

In this summary we highlight the following items from the consultation paper:

  • Urgency of the Matter
  • No word on transaction Costs
  • No review of the Priips framework
  • Amendments to performance scenarios
  • Identification of alternative options
  • Callable structured products

To view the complete Summary, please click here, or copy this link into your browser: https://bit.ly/2LaxLfc.