FCA confirms changes to PRIIPs regulation

Following its consultation in 2021, the FCA has confirmed it is making changes to the PRIIPs regulation to:

• clarify the scope of the PRIIPs regulation for corporate bonds, making it clearer that certain common features of these instruments do not make them into a PRIIP;
• introduce interpretative guidance to clarify what it means for a PRIIP to be ‘made available’ to retail investors;
• amend the PRIIPs RTS to:
  • replace the requirements and methodologies for presentation of performance scenarios in the KID with a requirement for narrative information on performance to be provided;
  • address the potential for some PRIIPs to be assigned an inappropriately low summary risk indicator in the KID; and
  • address concerns about certain applications of the ‘slippage’ methodology when calculating transaction costs.

The changes take effect on 25 March 2022 and firms will have until 31 December 2022 to implement them.