New product rules will cause IFA ‘headaches’

It appears derivatives and structured products will be classified as complex, although there is still uncertainty as to what Priips should be excluded from the comprehension alert, Mr Cameron added.

“We expect the ESA to provide further guidance in this area as part of the ongoing consultation,” he added.

The ESA expects to follow the current technical discussion paper - published last month - with a final consultation paper setting out the draft regulatory technical standards in the autumn.

“It remains to be seen if the methodologies that are being developed for Priips could lead regulators in the UK to makes changes to other aspects of the disclosure regime not currently within the scope of Priips,” said Mr Cameron.

“We don’t need to produce Kids at present as the earliest we will need to issue these is by December 2016, once we know more from the detailed rules on what is required we will formalise our programme of implementation,” he continued, adding that the advantages and disadvantages will depend on how the rules are drafted.