It will come as a relief to industry that the European Commission has confirmed there will be a one-year delay to the implementation date of the Packaged Retail and Insurance-based Investment Products ("PRIIPs") regulations. The implementation date will now be 1 January 2018.
The move comes after September's rejection by the European Parliament of the draft Regulatory Technical Standards ("RTS") developed by the European Commission to flesh out details on the required content and underlying methodology for key information documents ("KIDs"). The Commission set a six-week deadline for the re-submission of the RTS and stated that it expects the PRIIPs framework to be in place by the end of H1 2017.
The European Commission was originally scheduled to consider whether to delay the introduction of PRIIPs on 22 November, but brought forward the discussion to last Wednesday. The Commission stated that although it believed the PRIIPs regulation to be sufficiently clear and directly applicable on its own, its objectives would be better served by having the RTS on KIDs already in place by the implementation date, and noted that the European Parliament and Council support the view that the substance of PRIIPs should not be re-opened.
The European Supervisory Authorities responsible for drafting the RTS have been asked by the Commission to make targeted changes in certain areas (i.e. multi-option products, performance scenarios, comprehension alert and presentation of insurance related costs), however the Commission appeared anxious to keep changes to the RTS to a minimum and only those concerns specifically raised in the Parliament's rejection of the RTS will be examined.
The six-week deadline and H1 2017 timeframe may mean that, by the time the new RTS are adopted by the Commission and scrutinised by the European Parliament and Council, time for industry consultation will be limited - if indeed there will be any time for such consultation at all.
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