LONDON, 22 November 2016: The safeguarding of investors’ interests as well as the need for legal certainty for the industry appear to be the main reasons underpinning the recent decision of the European Commission to propose an extension of the date of application of PRIIPs regulation, according to Veneziano Partners and PRIIPSHub.
After a heated few months of discussion on Level 2 PRIIPs legislation, which saw the European Commission fighting until the end on having to meet the December deadline for application of the PRIIPs regulation - notwithstanding a massive wave of opposition from the majority of industry representatives - the one year extension now proposed has manifold implications.
In the same note announcing the proposed delay, the European Commission still reiterates one of the main arguments used in the course of the debate surrounding the Regulatory Technical Standards, that the PRIIPs regulation is sufficiently clear and can be applied already irrespectively of Level 2 legislation. “We take issue with the validity of such an argument,” says Attilio from Veneziano & Partners Ltd – a regulatory boutique assisting fund managers and other financial institutions on European financial services regulation. “Given that from the very outset PRIIPs legislation was conceived under the Lamfalussy process and requires for its completeness, accordingly, all the four layers of legislation, we believe that the issue may be a procedural one instead and could very well lie somewhere in the extensive round of consultations with stakeholders commenced in 2009.”
Divergent views on the extension of the PRIIPs application date to the end of 2017 have reverberated around the funds industry. “Insurance companies and other product manufacturers that have to address the PRIIPs regulation might have slowed down the speed of the implementation, according to Carsten Mahler, CEO of PRIIPsHub - which acts as a neutral utility infrastructure for the exchange of data and documents. “However these product manufacturers recognize that they have to have PRIIPs in place before the end of year.”
When it comes to the fund companies, instead, there is a hope that the UCITS KIID can fulfill the requirements for MOPs (multi-option products), meaning that the need for data exchange might be reduced. “Here we are experiencing more of a “wait and see” approach,” says Mahler, “until the new RTS and the requirements have been defined and interpreted.”
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About Veneziano & Partners
Veneziano & Partners is an international consulting boutique, specializing in European regulatory affairs for the asset management and hedge fund sectors. The firm was founded in London in 2013 by Attilio Veneziano, a lawyer with considerable experience in the offshore funds industry. It opened its New York office in 2016 to assist a growing slate of US-based clients. The firm caters to investment managers and financial institutions seeking a modern approach to strategic and advocacy services around European regulation, including assistance with fund distribution projects.
PRIIPSHub is a neutral data and document exchange platform, a consortium of companies interested in information exchange, document product and PRIIPS-related services. PRIIPSHub works with all relevant stakeholders in its effort to create a legitimate European industry utility. It works with product distributors, issuers and service providers to deliver accurate and timely PRIIPS documents and data.
Press release distributed by PressHalo on behalf of Veneziano & Partners, on 23rd November, 2016.