PIMFA
PRODUCT DISCLOSURE
Current Regime – Packaged retail investment and insurance products (PRIIPS)
PRIIPs is a retained EU regulatory regime in the UK that applies to the distribution of Packaged Retail and Insurance-based Investments Products to retail clients. The regime covers a very wide range of investment products, from the most “vanilla” investment funds to the most complex derivatives. The Key Information Document (KID) presents data on product risks, costs and performance in a standardised format so that potential investors can compare different types of products and come to informed investment decisions.
The PRIIPS regime, and specifically KIDs, have not provided investors with the clear and concise information required and the vast majority of PRIIPs KIDs provided by distributors are not reviewed by retail investors.
The FCA is consulting on a new Product Information Framework for Consumer Composite Investments. This will replace the PRIIPs regime, however, PRIIPs KIDs will remain a requirement until rules are finalised and the new Product Information Summary documents are launched. Further information can be found here
- THE DRIVER FOR CHANGE - REPEAL OF THE UK RETAINED EU PRIIPs REGULATION
In December 2022, HM Treasury published a consultation which acknowledged that “The PRIIPs Regulation …. is not fit for purpose.” Consequently, the Government has decided that UK PRIIPs legislation will be revoked. It will be replaced by a new product disclosure regime that will sit within the FCA Handbook, enabling the regulator to review and update it as markets evolve.
HM Treasury’s consultation sought views on how a new product disclosure regime can meet consumer needs without repeating the mistakes of PRIIPs. While making clear that PRIIPs reform is its immediate priority, the paper also recognises that there is a need for a wider review of retail disclosure requirements and sets out the principles that will govern this process.
Alongside the HM Treasury paper, the FCA issued Discussion Paper 22/6 seeking preliminary feedback on how it should approach developing a replacement product regime for PRIIPs and wider reform of retail disclosures. Our “UK Retail Disclosure” material provides further information.
latest news
April 2025
PIMFA response to Consultation Paper 25/9 – Further proposals on product information for Consumer Composite Investments
In April 2025, the FCA issued a follow up consultation to CP24/30, CP25/9 – further proposals on product information for Consumer Composite Investments. PIMFA shares the FCA’s aim of delivering better consumer outcomes and increasing transparency. However, we retain the view expressed in our response to the previous consultation that as currently conceived, the CCI proposals will not result in the simplicity and clarity the industry had hoped for. As it continues to refine the final regime, the FCA needs to ensure that its expression of what the regime represents and the practical implications which fall on industry to deliver it are aligned. This means prioritising the disclosure of information which is accurate, understandable and comparable across the full spectrum of client facing disclosures. We remain concerned that this disconnect between the two has not been sufficiently addressed and as a result, we run the risk of creating more confusion for industry and consumers, not less.
March 2025
FCA CP24/30 A new product information framework for Consumer Composite Investments
In December the FCA published the long awaited consultation paper CP24/30 which aims to make sure the product information received by consumers is accurate, engaging, and as simple as possible to understand. The new proposals prescribe a suite of core product information which can be formatted and expanded upon by manufacturers and distributors to meet the needs of their target market.
The flexibility is aligned with Consumer Duty from a regulatory perspective but will bring its own challenges for manufacturers and distributors.
Read our response to the CP here
