ESAs Announce Outcome of Review of Key Information Document for PRIIPs
ESAs informed EC, via a letter, that the draft regulatory technical standards that amend the technical rules on key information document (KID) for packaged retail and insurance-based investment products (PRIIPs) were not adopted by all three ESA Boards. Therefore, ESAs are not in a position to formally submit the technical standards to EC. The letter details the outcome of a review conducted by ESAs on KID for PRIIPs. The review intended to address the regulatory issues that have been identified since the implementation of the KID—particularly regarding the information on performance and costs—and to allow the appropriate application of the KID by undertakings for collective investment in transferable securities (UCITS).
As part of this review, a draft final report had been submitted to the Boards of Supervisors of the three ESAs in June, for their approval. The report contained balanced and proportionate final proposals that would allow ESAs to meet their key policy objectives, while remaining in line with the PRIIPs level 1 framework (Regulation 1286/2014). The draft technical standards were adopted at the EBA and ESMA Boards on the basis of qualified majority voting. At the EIOPA Board, the standards did not receive the support of a qualified majority, although a large number of members agreed with the draft technical standards. The EIOPA Board members that did not support the technical standards generally argued that a partial revision of the PRIIPs Regulation is not appropriate at this stage, prior to a comprehensive review of Regulation 1286/2014 as envisaged in Article 33 of the Regulation. A number of Board members also indicated that, for investment funds, they would prefer the past performance graph from the UCITS key investor information document to be included in the PRIIPs KID, rather than in a separate publication. Given that the draft technical standards were not adopted by the three ESA Boards, ESAs are not in a position to formally submit the technical standards to EC. For transparency, the draft final report has been included as an Annex to the letter.
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Keywords: Europe, EU, Banking, Insurance, Securities, KID, PRIIPs, UCITS, Regulatory Technical Standards, EC, ESAs
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