On 3 February 2021, the European Supervisory Authorities (ESAs) submitted draft Regulatory Technical Standards (RTS) to the European Commission. These contained amendments to the key information document (KID) for packaged retail and insurance-based investment products (PRIIPs).
Although some national competent authorities on EIOPA’s board expressed reservations about this draft RTS, they ended up supporting the proposal, agreeing to a broader review of PRIIPs regulation.
Following its submission to the Commission, the draft RTS is now subject to adoption. If adopted by the Commission, the RTS would be subject to non-objection by the European Parliament and the Council of the European Union.
What challenges can we expect?
If adopted within the current implementation deadline, UCITS funds would be required to transition into PRIIPs KIDs by 31 December 2021 so that they can be marketed to retail investors.
The implementation of PRIIPs KID requires the asset management industry to address several challenges within a very short time frame if they want to reach the expected regulatory deadline, as well as implement an efficient operating model.
So, what’s on the to-do list?
- Appropriation, interpretation and implementation of new RTS (e.g. revised computation methodologies)
- Automation of end-to-end production processes to ensure efficient operations, accuracy of produced information and quick time-to-market
- Integration and alignment of PRIIPs and MiFID reporting processes to ensure consistent information is distributed to the market and generate operational savings
- Centralization of all stakeholders’ contributions (data exceptions management, quality review, translation, dissemination, etc.) across the entire value chain to facilitate activity oversight and minimize coordination costs
Solutions and support
The asset management industry must comply with multidisciplinary PRIIPs requirements while maximizing operational efficiency. That’s why KPMG has developed a holistic business solution supported by a digital proprietary technology platform and powered by an experienced team of multidisciplinary experts (regulatory experts, risk managers, technologists, data specialists, security experts, etc.) to cope with all angles of PRIIPs complexity in a streamlined manner.
With a pragmatic onboarding approach, leveraging best practices from more than a decade’s experience, we equip market players with:
- Flexibility to adapt to financial institution’s specific data and operating environments
- Maximum automation to minimize time-to-market and operational risks
- Process integration to optimize data/process synergies across various reporting requirements (EPT, EMT, KID, etc.), enhance consistency and generate economies of scale
- Process digitalization to centralize required stakeholders’ contributions and generate coordination savings
- Transparency across advanced process and KPI monitoring dashboards to ensure proper activity oversight
- Extensive regulatory monitoring framework to keep up to date with latest requirements and practices
We are here to help! Get in touch with our Regulatory Reporting team to learn more about KPMG’s value proposition.