On 10 November 2014, the Council of the EU announced that it has adopted the Regulation on key information documents (KIDs) for packaged retail and insurance-based investment products (PRIIPs). The European Parliament voted in plenary to adopt the Regulation on 15 April 2014.
The Regulation requires KIDs to be drawn up for PRIIPs. It lays down uniform rules on the format and content of key information documents and on their provision to retail investors. There is a transitional period of 5 years from the date of entry into force of the Regulation before it will apply to UCITS funds. This transitional period also applies to non-UCITS funds offered to retail investors, where a Member State applies UCITS key information requirements to such funds. This transitional period may also be prolonged following a review of the Regulation which is due to take place 4 years after its entry into force.
The Regulation is expected to enter into force in December 2014, depending on the date of its publication in the Official Journal. Its requirements will be applicable two years after its entry into force.
Regulatory technical standards
The Regulation mandates the three European Supervisory Authorities (EIOPA, ESMA and the EBA) to prepare draft regulatory technical standards (RTS) in specific areas. On 17 November 2014, the Joint Committee of the European Supervisory Authorities published a discussion paper on KIDs for PRIIPs.
The closing date for responses to the discussion paper is 17 February 2015. The ESAs are expected to submit the RTS to the Commission at the start of 2016.