Are you preparing for PRIIPs?
New Rules on PRIIPs
On the 7th April, the Joint Committee of the European Supervisory Authorities finished its regulatory technical standards (RTS) on KIIDs for PRIIPs.
The new rules address the content and presentation of the KIDs and include:
- a common mandatory 3-page template for the KID, covering the texts and layouts to be used (see Annexes I, III, V and VII of the Report);
- a summary risk indicator of seven classes for the risk and reward section of the KID;
- a methodology to assign each PRIIP to one of the seven classes contained in the summary risk indicator, and for the inclusion of additional warnings and narrative explanations for certain PRIIPs;
- details on performance scenarios and a format for their presentation, including possible performance for different time periods and at least three scenarios;
- costs presentation, including the figures that must be calculated and the format to be used for these i.e. in both cash and percentage terms;
- specific layouts and contents for the KID for products offering multiple options that cannot effectively be covered in three pages;
- rules on revision and republication of the KID, to be done at least each year; and
- rules on providing the KID sufficiently early for a retail investor to be able to take its contents into account when making an investment decision.
The new rules are available here and have been submitted to the European Commission for endorsement. They will come into force on the 31 December 2016.
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