The European Commission has announced a delay to the Packaged Retail Insurance-based Investment Products (PRIIPs) regulation.
Chris Cummings, Chief Executive of the Investment Association, said: “We welcome the Commission’s decision to delay the PRIIPs date of implementation by a year. The draft rules, that were rejected by the European Parliament in September, would have led to extremely flawed and misleading retail investor disclosure. The additional time should mean that regulators and legislators are able to take a step back and design a PRIIP KID* that provides consumers with better disclosure than the current draft rules permit. It is now time to get it right, and for the Commission to amend the presentation of costs and charges and improve the performance disclosure by adding historic performance alongside future scenarios. It is essential that our industry not only has legal certainty as to what will be needed to produce a PRIIP KID, but also sufficient time to put the necessary systems in place. Therefore, we urge the Commission to come back with final rules in early 2017.”
John Dowdall, MD of Silverfinch added: “PRIIPs certainty should help stakeholders with their plans. The announcement that the European Commission has decided to delay the introduction of PRIIPs by 12 months is good news, the best part of which is that stakeholders now know the amount of time they have to prepare for the regulations after weeks of uncertainty. The postponement also allows banks, insurers and fund managers to make sure they have the infrastructure in place so that the full range of products can continue to be sold to the investing public. For fund managers forward planning is now particularly important as the delay means that PRIIPs will be introduced at the same time as MiFid II. It is now time for the industry to work together to ensure that companies have the data to help them introduce PRIIPs seamlessly over the next few months.”
*Packaged Retail Insurance-based Investment Products Key Information Document