On 30th July, HMT published amendments to the Packaged Retail Investment and Insurance-based Products ("PRIIPs") Regulation.  The amendments to the onshored PRIIPs Regulation are designed to avoid consumer harm and provide the appropriate certainty to industry once the UK ceases to be bound by the EU regime. 

HM Treasury intends to make the following changes: 

1. An amendment enabling the FCA to clarify the scope of the PRIIPs Regulation through their rules (designed in particular to bring certainty to the scope of PRIIPs to investments such as corporate bonds). 

2. An amendment to replace ‘performance scenario’ with ‘appropriate information on performance’ in the PRIIPs Regulation. 

The methodology for calculating performance scenarios is set out in the PRIIPs RTS, and has been criticised for producing misleading results across a wide range of products. The proposed amendment will enable the FCA to clarify what information on performance should be provided in the KID. 

3. An amendment enabling HM Treasury to further extend the exemption currently in place for Undertakings for the Collective Investment in Transferable Securities (UCITS) funds. 

This will allow UCITS funds to continue to produce a KIID rather than a PRIIPs KID for up to a maximum of five years. This will enable HMT to consider the most appropriate timing for the transition of UCITS funds into any domestic successor that may result from the planned review of the UK framework for investment product disclosure, and bring forward a Statutory Instrument to amend the exemption date in the PRIIPs Regulation as necessary.