European Parliament
UCITS and PRIIPs - Draft reports on use of key information documents under PRIIPs Regulation and UCITS Directive - 18 October 2021
The European Parliament’s Economic and Monetary Affairs Committee (ECON) has published draft reports on the following amendments adopted by the European Commission:
- a draft report on a proposal for a draft Regulation amending the Packaged Retail and Insurance-based Investment Products Regulation (1286/2014/EU) (PRIIPs Regulation). Article 32 of the PRIIPs Regulation provides for a temporary exemption from the requirement to provide retail investors with a key information document (KID) for management companies, investment companies and persons advising on, or selling, units of UCITS and non-UCITS. The exemption expired on 30 June 2022 and the draft Regulation extends the transitional arrangement to 31 December 2022; and
- a draft report on a proposal for a Directive amending the Undertakings for the Collective Investments in Transferrable Securities Directive (2009/65/EC) (UCITS Directive) as regards the use of KIDs by management companies of UCITS. In July 2021, the European Commission adopted the proposed Directive which inserts a new Article 82a into the UCITS Directive. It states that where a KID is drawn up, provided, revised and translated for a UCITS pursuant to the PRIIPs Regulation, it should be considered as satisfying the requirements applicable to key investor information for the purposes of the UCITS Directive. Under the Directive, EU member states are expected to apply measures to implement it from 1 July 2022. The new amendment revises that date to 1 January 2023.
Draft Report on the proposal for a directive of the European Parliament and of the Council amending Directive 2009/65/EC as regards the use of key information documents by management companies of undertakings for collective investment in transferable securities (UCITS)
Draft Report on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EU) No 1286/2014 as regards the extension of the transitional arrangement for management companies, investment companies and persons advising on, or selling, units of undertakings for collective investment in transferable securities (UCITS) and non-UCITS
European Supervisory Authorities
PRIIPs - ESAs publish call for evidence - 21 October 2021
The European Supervisory Authorities (ESAs), comprising the European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA) and the European Securities and Markets Authority (ESMA), have published a call for evidence regarding the Packaged Retail and Insurance-based Investment Products Regulation (1286/2014/EU) (the PRIIPs Regulation). As part of the European Commission’s review of the PRIIPs Regulation and its work on several legislative proposals implementing aspects of the Commission’s retail investment strategy, the ESAs are required to provide advice on the following areas:
- a survey on the use of the key information document (KID) by distributors and financial advisors;
- a survey on the operation of the comprehension alert in KID;
- a survey of the practical application of the requirements under the PRIIPs Regulation;
- the effectiveness of the administrative sanctions, measures and other enforcement actions for infringements of the PRIIPs Regulation;
- the extent to which the PRIIPs Regulation is adapted to digital media; and
- an examination of several questions concerning the scope of the PRIIPs Regulation.
The call for evidence also requests feedback on other areas of the PRIIPs Regulation that the ESAs have identified as potentially requiring improvement.
The ESAs will use responses to the call for evidence in developing their technical advice to the Commission, which is due on 30 April 2022. There will be a stakeholder event in Q1 2022, before the ESAs finalise their advice, details of which will be provided in due course.
The call for evidence is open until 16 December 2021.
Call for evidence on the European Commission mandate regarding the PRIIPs Regulation
Press release
European Banking Authority
IFR - Investment policy disclosure - EBA publishes final report on RTS - 19 October 2021
The European Banking Authority (EBA) has published its final report (EBA/RTS/2021/08) on new regulatory technical standards (RTS) specifying templates and tables for the disclosure of investment policy by investment firms under the Investment Firms Regulation ((EU) 2019/2033) (IFR).
Article 52 of the IFR requires class 2 investment firms to publicly disclose proportions of voting rights attached to shares held, voting behaviour, use of proxy advisor firms and voting guidelines. Class 2 investment firms are those which exceed one of the thresholds applying to class 3 investment firms (small and non-connected firms). The full Investment Firms Regime under the IFR, and the Investment Firms Directive (EU) 2019/2034), applies to them.
The new RTS put forward comparable disclosures and instructions to help stakeholders understand the influence of investment firms over the companies in which they hold, directly or indirectly, shares with attached voting rights. Section 4 of the report contains the responses received to the EBA’s consultation on the draft IFR RTS (EB/CP/2021/15) and the EBA’s responses.
The RTS is accompanied by two annexes. Annex I contains templates and tables for the disclosure. Annex II contains detailed instructions for their preparation.
The final RTS have been submitted to the European Commission for adoption.
Final Report: Draft Regulatory Technical Standards on disclosure of investment policy by investment firms under Article 52 of Regulation (EU) 2019/2033 on the prudential requirements of investment firms
Annex I - Disclosure of investment policy by investment firms
Annex II - Instructions on disclosure of investment policy by investment firms
Press release
HM Treasury
PRIIPs Regulation - HM Treasury publishes Regulations - 15 October 2021
HM Treasury has published the Packaged Retail and Insurance-based Investment Products (UCTIS Exemption) (Amendment) Regulations 2021 (the Regulations).
The Regulations amend the onshored PRIIPs Regulation, extending the existing exemption under the Regulation for management and investment companies and persons advising on, or selling, UCITS funds from the requirements under the PRIIPs Regulation. Under the exemption, UCITS funds providers must produce a key investor information document (KIID), rather than a key information document (KID), as required under the UCITS Directive (2009/65/EC). The Regulations extend the exemption by five years, to 31 December 2026.
The Regulations come into force on 31 December 2021.
The Packaged Retail and Insurance-based Investment Products (UCITS Exemption) (Amendment) Regulations 2021 (SI 2021/1149)
Webpage
Explanatory Memorandum
See the General section for an item on the Climate Financial Risk Forum’s second set of guides on climate-related financial risk management.
