Firms operating in the EU that manufacture, sell, or advise on PRIIPs (Packaged Retail and Insurance-Based Investment Products) must provide retail investors—and, in some cases, non-retail investors—with a three-page Key Information Document (KID). This requirement, in place since 2018, ensures that investors receive clear and standardised product information.

At Qvonto, we have been producing thousands of PRIIPs KIDs for our clients over the years. Now, the EU has introduced regulatory updates for 2023, refining the presentation and content of KIDs. These changes aim to enhance transparency, improve investor understanding, and address practical challenges identified in previous regulations.

Key Changes in the 2023 PRIIPs KID Amendments

• Enhanced Performance Scenarios: New methodologies underpin the calculation and presentation of performance scenarios, ensuring investors do not develop unrealistic expectations about potential returns.

• Improved Cost Disclosures: Revised summary cost indicators provide clearer insights into cost structures. These changes enhance investor understanding and facilitate better decision-making by advisers and distributors.

• Updated Transaction Cost Methodology: Adjustments address practical challenges in calculating transaction costs, ensuring more accurate and consistent reporting across different types of investments.

• Clarity for Multi-Option PRIIPs: New rules improve transparency for PRIIPs offering multiple investment options, making cost implications easier to comprehend.

• New Standards for Past Performance Data: UCITS, retail AIFs, and insurance-based investment products must now provide past performance data. However, this data will not be included directly in the KID but will be accessible via references such as website links.

What This Means for You

These changes reinforce the EU’s commitment to improving investor protection and market efficiency. Firms should review their PRIIPs KID generation processes to ensure compliance with the updated standards. At Qvonto, we are fully prepared to help our clients transition seamlessly to the new requirements, ensuring continued compliance and investor confidence.

For more information on how these amendments impact your firm, reach out to our team at Qvonto today.