We’ve previously iterated how manufacturers and distributors of PRIIPs (Packaged retail investments and insurance-based products) got a little extra time to implement the new Key Information Documents (KIDs) instead of the Key Investor Information Document (KIID). That deadline – July 1, 2023 – has just been postponed (again) to January 1, 2023.
So this is the last call to asset managers and insurers: Are you ready for the new PRIIPs KIDs? You shouldn’t count on another postponement – January 1, 2023, will be the final call.
What the deadline entails
The European Parliament Committee on Economic and Monetary Affairs (ECON) has very recently approved amendments to the original PRIIPs KID implementation. This means:
- The PRIIPs KID transition period has been extended to January 1, 2023
- The UCITS (Undertakings for Collective Investment in Transferable Securities) KIIDs exemption period has also been extended until January 1, 2023
Asset managers, banking institutions, and insurance companies – i.e. manufacturers and distributors of PRIIPs products – who are doing business in the EU, will have to implement the new and revised version of the PRIIPs KIDs document by the end of 2022 – at the latest. As of January 2023, there will be no further exemption for UCITS funds marketed to retail clients. All documents will have to transit from UCITS KIIDs to the new PRIIPs KIDs by that date.
The revised deadline is due to the extended validity of the UCITS Directive until December 31, 2022. With the deadline for both the UCITS Directive and PRIIPs KIDs synchronized, investors can hopefully avoid receiving two documents – UCITS KIID and PRIIPs KID – at the same time.
What is the new PRIIPs KID format?
Fortunately, the regulatory changes and transition to the “new” PRIIPs KID world are not as trivial as they might sound.
The new document is a more demanding and data-focused investor information document than the former UCITS KIIDs that manufacturers of mutual funds were to provide to their clients. Changes will primarily concern the calculation methods, which affect the computation of risks, performance scenarios, and transaction costs.
So if you already have an existing KID production system in place, now is the time to have it revised, analyzed for gaps, adjusted to the new regulatory standards, and tested before the go-live date in January 2023.
Who produces PRIIPs KIDs?
We can help you organize your data management and automate the whole KID production process. This is the epitome of what one of our portfolio companies, TTMzero, does. They combine two areas of expertise: The valuation of financial instruments, which is key to calculating the required PRIIPs KIDs data, and a profound experience in the automation of issuing processes for financial securities.