We have confirmed changes to the Packaged Retail and Insurance-based Investment Products[1] (PRIIPs) regulation to address the areas that pose the most harm to investors.
These new requirements are one of the first examples of the FCA confirming UK divergence from EU rules following Brexit.
Those that manufacture, advise on, or sell PRIIPs are required to produce and provide a Key Information Document (KID) about the product they are selling. Our changes remove information about the performance of certain products which can be misleading for consumers and will help those buying without financial advice to rely on the KID to make more informed investment choices.
Following feedback from respondents, firms will now have until the 31 December 2022 to implement the changes, and we’ve provided more clarity on how we expect firms to construct narrative descriptions of performance within KIDs.
While some respondents called for a fundamental review of the whole PRIIPs regime, the legislative changes made by HM Treasury were targeted to fix the most harmful issues quickly following the UK’s exit from the EU. However, HM Treasury have committed to carrying out a review of retail disclosure in the future and we will work closely with them as this develops.