Warning 'flawed' PRIIPs extension would impact credibility of global UCITS brand

Clash over regulation continues

Industry bodies representing the UK and EU asset management industry are at odds over whether the planned extension of troubled PRIIPs regulations to cover a wider range of strategies including UCITS vehicles from 31 December 2019 should go ahead, while the European Commission (EC) has clashed with top EU regulators over the plan.

The Packaged Retail and Insurance-based Investment Products regulation (PRIIPs), which came into force in January and currently encompasses many retail investment products excluding UCITS funds and non-UCITS retail schemes, requires asset managers to provide a Key Information Document (KID) for investors. This new literature has been heavily criticised due to its controversial requirement to provide predictions of future performance, as well as concerns about the methodology used to estimate transaction costs. At present, UCITS and non-UCITS schemes are exempt, and are required instea...