Tracing the Key Impacts of transition to PRIIPS KID

The PRIIPS regulatory technical requirements will have substantial operational implications in terms of performance scenarios, transaction cost techniques, and presentations.

EIOPA accepted the revised PRIIPs regulatory technical standards ("RTS") proposed in July 2020 on February 3, 2021, having an impact on insurers and asset managers.
Asset managers, in particular, must plan for the transition from UCITS KIID3 to PRIIPs KID by the end of 2021.

The Act alters the PRIIPs Regulation regime in the United Kingdom, among other things, to:

1. Enable the FCA to clarify the scope of the UK PRIIPs Regulation, in particular, to address current and any future misunderstandings with connection to certain types of investment products.
2. Replace the requirement for specific performance scenarios with a more general requirement for "adequate information on performance," and give the FCA the authority to define what performance information must be provided; and
3. Delegate authority to HM Treasury to continue the UCITS exemption for another five years.

Scenarios of performance


1. For performance scenarios, a new calculating mechanism has been developed.
2. A minimum of ten years' worth of price history is necessary.
3. Preference is given to regulated benchmarks in a defined benchmark selection process.
4. Costs of transactions
5. Until December 2024, the estimation methodology can be employed.
6. There should be no negative transaction costs and only a few explicit expenses indicated.

Impact on Operations

1. Significant modifications to the data sourcing process, such as the acquisition of benchmark data/licenses and the creation of new narratives. Previous PRIIPs performance situations will be made public.
2. Investors should be able to see past performance on the website or in other papers, as required by the UCITS directive.
3. The European PRIIPs Template ("EPT") has been updated.
4. EPT and Comfort European PRIIPs Template ("CEPT") will be requested by more insurers.

Without an iota of doubt, you would need experts to look into priips key information document. Ensure to look for a reliable name in the industry.

Who must prepare the KID?

Manufacturers of PRIIPs, as well as any business making changes to an existing PRIIP, are required to develop a KID and post it on their website. Because they are in the best position to know the product, the Regulation advises that fund managers, insurance undertakings, credit institutions, and investment businesses be considered PRIIPs makers.

Who is responsible for delivering the KID?

Before retail investor contracts for a PRIIP, a person advising on or selling a PRIIP must provide the KID to the retail investor on paper or in durable media, and on time.
The availability of the KID on the manufacturer's website does not free the distributor from this duty. However, if certain circumstances are met, the KID can be supplied through a website.

Retail investors may be given the KID after signing a PRIIP contract in unusual situations.

How often should the KID be updated?

Every year, a PRIIP producer must examine the information in the KID.
Under the PRIIPs Regulation, EEA member states have the authority to impose a pre-filing requirement. There is currently no sign that such a requirement will be implemented.

Is there anything I need to file?

Under the PRIIPs Regulation, EEA member states have the authority to impose a pre-filing requirement. There is currently no sign that such a requirement will be implemented.
Moreover, there are a few things that you need to keep in mind before and understanding KID in-depth.
The KID is required to be written in a brief manner (no more than three sides of A4), be conveyed, and employ clear, succinct, and understandable language It must be translated into the languages of all EEA member states where the PRIIP is made available.