IMD II, PRIPs and UCITS V: European proposals to enhance consumer protection

Regulatory radar newsflash from the EMEA Centre for Regulatory Strategy


The IMD II and PRIPs proposals introduce rules aimed at levelling the playing field for the sale and disclosure of insurance and retail investment products to strengthen consumer protection. PRIPs addresses disclosure rules for retail investment products and IMD II addresses sales and disclosure rules for insurance products, including additional sales rules for insurance investment products – insurance ‘PRIPs’.

Both proposals pose significant strategic and operational challenges for providers and distributors in the insurance and retail investment markets. IMD II proposes to widen the scope of the Directive and strengthen conduct of business and professionalism requirements. PRIPs proposes the introduction of the Key Information Document (KID) when investment products are sold to retail consumers. IMD II and PRIPs, while separate proposals, are linked.

Our briefing note, which can be viewed on our website, provides an overview of the proposals followed by a more detailed look at the key changes contained in the proposals and the challenges they might bring for firms.


The UCITS V proposal sets out regulations and administrative provisions in respect of depositary functions, remuneration policies and sanctions relating to UCITS. It seeks to rectify existing discrepancies in rules relating to depositary regimes in the investment funds market to strengthen consumer protection.

There are three elements in this proposal:

  • A new depositary regime which includes a clarification of the depositaries’ duties, responsibilities and liabilities and a set of the rules under which tasks and responsibilities can be delegated – mainly focussing on the sub-custodian network;
  • Rules governing remuneration of key individuals (i.e. senior managers, risk takers and those who exercise control functions); and
  • A sanctions regime.

Our briefing note, which can also be viewed on our website, provides an overview of the key changes to the UCITS Directive and the impact this will have on depositaries and UCITS Management Companies.

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