Priips setback confirmed as MEPs reject proposals

Priips setback confirmed as MEPs reject proposals

The Packaged Retail and Insurance-Based Investment Products (Priips) regulation is to be sent back to the European Commission after it was overwhelmingly rejected by members of the European Parliament (MEPs).

Some 602 MEPs voted in favour of changing to the legislation, with four voting against and 12 abstentions. The motion backed the view of its Economic and Monetary Affairs (Econ) committee that the proposed regulatory technical standards (RTS) were inadequate.

Earlier this month, the committee voted to reject the Priips delegated act encompassing the RTS because of a proposal that past performance figures be replaced with “future performance scenarios” in key information documents (Kids).

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The European Commission must now revise regulation documents which will again be voted on by the Parliament. The regulation is currently still set to come into force at the end of this year.

However, MEP Sven Giegold, the parlimentarian behind the original criticism of the future projection scenarios, said the Commission may have to consider delaying the start date.

“The Commission should read the sign on the wall that ignoring Parliament’s concerns – as has happened in this and earlier cases – will not be accepted and only prolong the process.

“[It] could not convince MEPs with its last minute fixes. When revising the rules now, the Commission has to make sure that these reviewed rules will be legally sound to work properly in practice,” he said.