The term “packaged retail and insurance-based investment product” (PRIIP) captures any product that is:
- a packaged retail investment product (PRIP); and/or
- an insurance-based investment product (outside the scope of this note).
To determine whether your securities are PRIPs, and as such, whether Regulation (EU) No. 1286/20141 on key information documents for packaged retail and insurance-based investment products (PRIIPs) applies to you, you should ask the following questions:
If in any doubt, or if you know PRIIPs does apply, to avoid the requirement to produce a Key Information Document (KID), you should take all steps necessary to ensure that the securities are not made available to retail investors within the territory of the EU. These steps could include:
- Taking measures to ensure that it is not possible for retail investors within the EU to invest in the securities; for example, by including an EU investor schedule in the underwriting agreement which makes clear that only investors meeting the professional client definition under MiFID II will be able to invest;
- Including relevant legends and selling restrictions in the documentation that expressly state that the securities are not being offered or made available to retail investors within the territory of the EU; and
- Notifying any distributors, placement agent or sales teams, making it clear that the securities are not to be offered or sold to retail investors within the territory of the EU.