Investment Association calls for Priips KID review

The UK Investment Association has called for an “urgent early review” of the Packaged Retail and Insurance-based Investment Products (Priips) regulation Key Information Document (KID).

It follows warnings from asset manager Baillie Gifford to the UK’s Financial Conduct Authority (FCA) that the KIDs were “seriously flawed” and could lead to investors receiving potentially misleading information at the point of sale. In response the regulator said Priips manufacturers could give investors explanatory materials setting out their concerns.

Since the beginning of the year Priips manufacturers have been required to publish a KID, which must be accurate, fair, clear and not misleading, for each of their Priips, detailing risks, performance scenarios and costs.

In a statement, the FCA said: “Where firms selling or advising on Priips have concerns that the performance scenarios in a particular KID may mislead their clients, they should consider how to address this, for example by providing additional explanation as part of their communications with clients.”

The Investment Association said it welcomed the FCA’s recognition of the challenges in the KID.

The association added: “From a positive starting point of trying to make different products comparable, the KID now makes it almost impossible to compare similar products. Performance scenarios and the way charges and transaction costs are presented are exceptionally difficult for customers to understand.”

©2018 funds europe

HAVE YOU READ?

THOUGHT LEADERSHIP

The tension between urgency and inaction will continue to influence sustainability discussions in 2024, as reflected in the trends report from S&P Global.
FIND OUT MORE
This white paper outlines key challenges impeding the growth of private markets and explores how technological innovation can provide solutions to unlock access to private market funds for a growing…
DOWNLOAD NOW

IRELAND SPOTLIGHT

Visit our dedicated Ireland channel for all the latest news and analysis on the country's investment industry.
READ MORE

PRIVATE MARKETS FUND ADMIN REPORT

Private_Markets_Fund_Admin_Report

LATEST PODCAST