European Parliament Votes To Reject Commission's Proposed Regulatory Technical Standards

On 14 September 2016, the European Parliament voted to reject the PRIIPs Regulatory Technical Standards (the "RTS") which were endorsed by the Commission on 30 June 2016. This follows a vote by the European Parliament's Economic and Monetary Committee ("ECON") on 1 September 2016 to support a motion to reject the RTS.

The RTS, which supplement the EU regulation on key information documents for packaged retail and insurance-based investment products (the "PRIIPs KID Regulation"), specify the presentation, content and underlying methodology of the key investor document ("KID") that will have to be provided to retail investors when they buy certain investment products.

In rejecting the RTS, the European Parliament raised concerns over certain aspects of the KID including, amongst others, that the proposed methodology for the calculation of future performance scenarios contains flaws, that there is a lack of clarity relating to the treatment of multi-option products,