PRIIPs KID

Which Member States require pre-notification of PRIIPs KIDs?

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Pursuant to Article 5(2) of the PRIIPs KID Regulation (Regulation (EU) No 1286/2014), any Member State may require the ex ante notification of the key information document (KID) by the PRIIP manufacturer or the person selling a PRIIP to the competent authority for PRIIPs marketed in that Member State.  Thus far, five Member States have chosen to implement this requirement:

  • Belgium 
  • Croatia
  • Finland 
  • Italy
  • Portugal

In addition, Slovenia has proposed draft legislation which will require, amongst other things, prior notification of the KID to national competent authorities.

Further, with effect from 17 April 2018 Luxembourg has legislated to give the CSSF the authority to require that a PRIIPs manufacturer or PRIIPs seller notifies ex ante the KID to their own competent authority.

We are not aware at this time of any other countries which have implemented or are intending to implement the Article 5(2) pre-notification requirement (other than in relation to certain funds in a number of Member States), but some jurisdictions have yet fully to implement PRIIPs KID into national law, and therefore could possibly include a PRIIPs KID pre-notification requirement in their implementing legislation.

The following is a table of the PRIIPs KID pre-notification requirements in each of Belgium, Croatia, Finland, Italy, Luxembourg Portugal and Slovenia. Please note that the information is in summary form only and was last updated up to, and is current to, 7 February 2019: the applicable legislation should be reviewed and local advice should be taken – particularly in regard to the detailed filing requirements – before making any KID pre-notification in the relevant jurisdiction. 

BELGIUM

What is the legislation? 
  • Section 8 of Chapter 2 of the Law of 2 August 2002 on the supervision of the financial sector and on financial services (as amended from time to time), in particular article 37sexies.
  • The Royal Decree of 25 December 2017.
  • Belgian FSMA Communication 2017/24 dated 29 December 2017: Notification of Key Information Documents for PRIIPS to the FSMA via the "FinPro" application.
When does it apply? 
From 1 January 2018, each applicable KID must be filed with FSMA.
What is the scope? 
  • Public offers only: with regards to investment products (instrument de placement - beleggingsinstrument) pre-notification requirement applies only to public offers (within the meaning of article 3 of the Belgian law of 16 June 2006 on the public offering of investment instruments, which implements the Prospectus Directive) and not to private placements.
  • Exemptions: there are exemptions for certain types of products including investment products (other than money market instruments) which are publicly offered in Belgium upon their admission to trading on a regulated market or MTF (with no prior public offering). Subject to taking advice in relation to any specific products, this may include turbos and similar products.
Who must file?  Either the PRIIP manufacturer or their vendor (typically the offeror/distributor).
By when must it be filed? 
  • New PRIIPs: KIDs must be notified to the FSMA before the provision of KIDs to retail clients in Belgium. In the context of a public offer (see above), the KID must be notified to the FSMA at least five business days before the start of the public offer or, if earlier, when the marketing materials are submitted to the FSMA for approval.
  • PRIIPs made available to Belgian retail investors prior to 1 January 2018: by 1 April 2018.
Must updated KIDs be filed?  Yes.
How must the KID be filed? The manufacturer or vendor of a PRIIP has the option of either notifying the KID to the FSMA via the "FinPro" application or sending it to FSMA by email to the address kidnotification@fsma.be. There are detailed requirements on how to make the filing. We would be pleased to advise.
In which language(s)? KIDs must be filed in Dutch, French or German. If in the context of a public offer, the KIDs notified to the FSMA must be in the same language as the marketing materials which are submitted to the FSMA for approval.
CROATIA
What is the legislation?
We understand that the Croatian competent authority (Hanfa) has confirmed that notification pursuant to Article 5(2) of the PRIIPs Regulation is required and the relevant KID must be filed with it 60 days before a PRIIP is made available to retail investors in Croatia.
FINLAND
What is the legislation? 
See The Act on Amending the Act on the Financial Supervisory Authority (228/2017) and press release 63/2017 on the website of the Finnish Financial Supervisory Authority
When does it apply? 
From 1 January 2018, each KID must be filed with the Finnish FSA.
Who must file? 
Either the PRIIP manufacturer or the offeror
By when must it be filed? 

  • New PRIIPs: before the beginning of the offering period.
  • PRIIPs made available to Finnish retail investors prior to 1 January 2018: before the beginning of the offer period (there are no grandfathering provisions).
Must updated KIDs be filed? Yes.
How must the KID be filed? The communication must be sent to the address PRIIPS-KID@fiva.fi. There are detailed requirements on how to make the filing. See the legislation above, and we would be pleased to advise in conjunction with Waselius & Wist, Finland.
In which language(s)? KIDs must be filed in Finnish or Swedish and, if prepared also in other languages, there is no need to file the other versions. However, as an exception, an English language KID may be used if only such investors that can be considered sufficiently fluent in English to understand the key features and risks of the product in English are targeted, sufficient product governance and KYC with respect to the targeted investors are adopted and the product is in no other way promoted or marketed in the Finnish or Swedish language.
ITALY
What is the legislation? 
See CONSOB weekly newsletter - year XXIII - No. 47 - 27 December 2017.
When does it apply? 
From 1 January 2018, each KID must be filed with CONSOB.
Who must file? 
Either the PRIIP manufacturer or the offeror.
By when must it be filed? 

  • New PRIIPs: the day before the start of the marketing in Italy
  • PRIIPs made available to Italian retail investors prior to 1 January 2018: by 31 March 2018
Must updated KIDs be filed? Yes.
How must the KID be filed? The communication must be sent to priips@pec.consob.it. There are detailed filing requirements on how to make the filing. We would be pleased to advise in conjunction with Grimaldi Studio Legale.
In which language(s)?  KIDs must be filed in Italian.
Is there anything else? 
  • Prior to the first filing: before making the first filing, the PRIIP manufacturer or offeror must notify CONSOB of the email address that will be used to file KIDs.
  • End of availability period: a subsequent notification (at the time when the PRIIP is no longer made available) must state the date on which the PRIIP will no longer be made available to Italian retail investors.
  • MOPs: there are specific rules in respect of multi-option products.
LUXEMBOURG
What is the legislation?
Luxembourg has put in place (by way of non-binding circulars and FAQs) a procedure for communicating the final PRIIPs KID to the CSSF in relation to Luxembourg investment funds (non-regulated AIFs, SICARs and SIFs), while there are transitional provisions for UCITS funds which produce a UCITS KIID already.  Subject to this there are no KID pre-notification requirements in Luxembourg although by a new piece of legislation which became effective as of 17 April 2018 the CSSF has been given the authority to require that a PRIIPs manufacturer or PRIIPs seller notifies ex ante the KID to their own competent authority.
PORTUGAL
What is the legislation?

On 20 July 2018, the Portuguese Parliament enacted Law no. 35/2018, which adapted the provisions of EU Regulation no. 1286/2014, of the European Union and the Counsel, of 26 November 2014 (the "EU PRIIPs Regulation") into the Portuguese legal system. Under Law no. 35/2018, the Portuguese Securities Market Commission ("CMVM") was granted the necessary powers to develop, within its scope, the EU PRIIPs Regulation in Portugal.

In this context, the CMVM issued Regulation 8/2018, of 21 December 2018 (the "CMVM PRIIPs Regulation") establishing the regulatory requirements applicable in Portugal to (i) marketing of PRIIPs; (ii) information regarding PRIIPs; and (iii) publicity regarding PRIIPs.

When does it apply?The CMVM PRIIPs Regulation does not provide for any grandfathering provisions for PRIIPs that have been offered before 1 January 2018 and will continue to be offered thereafter.
Who must file?The submission of the KID to the CMVM must be made by the PRIIP’s manufacturer, if located in Portugal, or by the manufacturer or distributor, if the manufacturer is located outside Portugal.
By when must it be filed?

Where a PRIIP is marketed through a public offer in Portugal which requires an approved prospectus under the Prospectus Directive regime (as implemented in Portugal), the PRIIP's KID must be filed with the CMVM within two business days following:

  • in the case of a stand-alone prospectus, that prospectus being approved by the CMVM (or, where Portugal is a host member state for the prospectus, that prospectus being notified to the CMVM);
  • in the case of a base prospectus which is approved by or notified to the CMVM, the relevant final terms being notified to the CMVM;

Otherwise, a PRIIP's KID must be filed with the CMVM at least two business days before the KID is published on its manufacturer’s website and the PRIIP is made available to investors in Portugal.

Furthermore, given that this new legal framework is quite recent and that the CMVM has still little or no experience on this matter, Portuguese counsel recommend not to start marketing the relevant PRIIP until two business days after the KID is submitted to the CMVM.

Must updated KIDs be filed?

If a KID is amended, the revised KID must be communicated to the CMVM at least two business days before the revised KID may be disclosed on its manufacturer’s website and used for marketing purposes in Portugal.

If a KID is amended, distributors will be obliged to notify each investor directly of that fact without unjustifiable delay and in any event no later than five business days after the revised KID is published on the PRIIP manufacturer’s website.

How must the KID be filed?The submission of a KID (or revised KID) to the CMVM must be made via the CMVM’s extranet and in a specific format.
In which language(s)?As a general rule, KIDs sent to the CMVM may be prepared either in Portuguese or in a language which is commonly used in international financial markets (in practice, English). Nevertheless, the CMVM PRIIPs Regulation further foresees that if a KID is to be provided to a retail investor, it may only be prepared in a language commonly used in international financial markets (i.e. other than Portuguese) if that retail investor expressly declares (i) that it has proper understanding of that language; and (ii) that it accepts to receive the KIDs in that language.
 Is there anything else?

Investors in a PRIIP must be provided with a subscription form, which they must fill-in, handwritten or typed, acknowledging (i) receipt of the relevant KID; and (ii) the risks and characteristics of the product. KIDs, subscription forms and all agreements with clients must be kept and archived for a minimum period of five years.

Publicity requirements also apply: all information regarding PRIIPs which are marketed to retail investors must be true, updated, clear, objective, legal and adequate. The CMVM must authorise the disclosure of any publicity materials. Once such authorisation is requested, the CMVM must approve/reject its validity within the following seven days, being considered approved if the CMVM does not reject it within such timeframe. This authorisation is granted for a period of six months.

Considering that the new regime implements a series of new regulatory requirements, local advice should be taken and the CMVM consulted ahead of any offering of PRIIPs to Portuguese retail investors.

SLOVENIA
What is the legislation? 
According to the last published draft (as of 1 December 2017) the Slovenian implementing law will require the ex-ante notification of PRIIPs KIDs by the PRIIP manufacturer or the person selling a PRIIP to the competent authority.  The implementing law is not in force and is subject to change and it is not known at this time when it will be implemented and in what form.

 

 

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