PRIIPS: ESA Joint Committee publishes final draft RTS on key information documents

The Joint Committee of the ESAs has finalised its proposal for regulatory technical standards (RTS) on Key Information Documents (KIDs) for Packaged Retail and Insurance-based Investment Products (PRIIPs).

The proposed RTS aim to provide retail investors in the EU with simple and comparable information on investment products in the banking, insurance and securities sectors. The proposed KID sets out to increase the transparency and comparability of information about the risks, performance and costs of these products.

The new rules include:

• a template for the KID, covering the texts and layouts to be used;
• a summary risk indicator of seven classes for the risk and reward section of the KID;
• a methodology to assign each PRIIP to one of the seven classes contained in the summary risk indicator, and for the inclusion of additional narrative for certain PRIIPs;
• details on performance scenarios and a format for their presentation;
• costs presentation, including the figures that must be calculated and the format to be used;
• layouts and contents for the KID for products offering multiple options;
• rules on revision and republication of the KID; and
• rules on providing the KID sufficiently early.

Pending approval by the EU Commission, the new rules will come into force on the 31 December 2016.