The financial crisis has had a number of repercussions on investor confidence in the services and financial products on offer. The distribution of retail investment products (PRIPs, or Packaged Retail Investment Products) has become more and more complex and requires coherent regulation. The proliferation of distribution channels and of legal vehicles in use makes an adaptation of EU regulation necessary.

In order to offer investors transparent information tailored to their needs, legislation in the vein of the “Key Investor Information Document” (KIID) used in UCITS IV has been introduced for a vast range of other investment products. Investors will thus benefit, with certainty, from a reliable and simple source to help them differentiate between two types of investments presenting similar characteristics.

Thus, on 26 November 2014, the Packaged Retail and Insurance-base Investment Products (PRIIPs) regulation was adopted by the European Parliament and the Council.

The Regulation provides that from 31 December 2016, every manufacturer of investment products falling in the scope will have to produce, for each investment product, a document with key information that is given to retail investors before any sale is completed.

The essential elements of the investment product which should be described in the KID are the following:

  • the identity of the product and its manufacturer,
  • the nature and the main features of the product, including whether the investors might lose capital,
  • its risk and reward profile, costs, and past performance as appropriate.


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