The European Commission has published the final text of its proposed packaged retail investments products (PRIPs) regulation on key information documents (KIDs) for investment products, which will replace the simplified prospectus.

To combat the difficulties of comparing very complex products, KIDs will be short, clearly written and easily understandable documents, designed to enable investors to truly understand the consequences of their potential investment.

Every investor must receive a copy of the KID in advance of making any investment. The ultimate responsibility for producing the KID, however, will sit with the investment product manufacturers, for example the investment fund managers, insurers and banks. Manufacturers will need to produce one KID per investment product. All PRIPs will have a KID.

The PRIPs Regulation is one part of a three-part legislative package being proposed by the European Commission, designed to rebuild consumer trust in financial markets. The European Commission has also published its proposals to revise the Insurance Mediation Directive, "IMD 2" and the UCITS IV Directive, "UCITS V". These are discussed in more detail below.

The proposed PRIPs Regulation has been passed to the European Parliament for consideration. The proposals are expected to come into force by the end of 2014.