The Wealth Management Association has welcomed a last-minute decision to adjust the rules for new EU regulation on packaged retail and insurance-based investment products (Priips).
The Priips legislation is set to be passed next week and will introduce key information documents (Kids) for a range of investment products.
The rules originally said that investors would have to sign these documents before executing any stock trade, along with other restrictions, but the WMA has been campaigning heavily to change the rules.
The trade body said the law as it originally stood could have resulted in “an end to real-time share dealing in listed funds in the UK”, but the EU has approved the amendments proposed by respondents including the WMA.
The amendments mean that when the law is passed, there will not be requirement to sign and return a Kid for each share or bond bought.
The changes will also mean that, for other investment products, investors will be able to sign the Kid after making a trade, rather than having to do so before the transaction.
The new law will also include a law recognising that discretionary managers can sign the Kids themselves when they are executing trades on behalf of clients.
WMA chief executive Tim May said: “We absolutely respected the aims of this regulation – to protect consumers – but had to work hard to explain to policymakers what the severe unintended consequences to the markets would be.
“We had to propose changes which would safeguard the UK’s investment culture without compromising the wider aims of the EU’s institutions.”
The rules were initially known as Prips - packaged retail investment products - but the acronym has been expanded to better explain the scope of the rules.
