Insurance Europe, AMICE, the EBF and EFAMA (the Group) have raised concerns about The Joint Committee of the European Supervisory Authorities (the ESA’s) consultation on potential changes to the regulatory technical standards (RTS) implementing the Packaged Retail and Insurance-based Investment Products Regulation (PRIIPs).
In its letter, the Group raise their “serious concerns” regarding the review, which they say is not mandated by the PRIIPs Regulation and “fundamentally flawed” in respect of the proposed changes to the PRIIPs Key Information Document (KID). In their view, the proposed changes will not meet the PRIIPs Regulation’s aim of providing information that is fair, clear and not misleading. Nor will the changes currently proposed solve the overarching problems with the KID.
The Group say that any changes to the PRIIPs KID must lead to concrete improvements in consumer understanding and the only way to ensure this is for all proposals to be subject to thorough consumer testing. They argue that the limited testing that has already been undertaken in this respect is insufficient.
It adds that since its entry into force two years ago, the PRIIPs framework has already been subject to a series of refinements and changes at European level as well as further requirements at national level. It argues that these create significant compliance burdens for companies and are to the detriment of consumer understanding.
The Group does not believe that a ‘one-size-fits-all’ approach will ever be able to make the PRIIPs KID work. The range of products, providers and national specificities captured by PRIIPs cannot always be accurately reflected by a single methodology or presentation format.