For immediate release

EFAMA calls on the European Commission to urgently postpone the UCITS exemption to protect consumers

EFAMA urges the Commission to prolong the UCITS exemption to avoid confusing investors with duplicative disclosures


Brussels, 3 October 2018 - EFAMA, the European Fund and Asset Management Association, has called on the European Commission to postpone the UCITS exemption within the PRIIPS regulation, following a letter issued yesterday by the European Supervisory Authorities (ESMA, EIOPA and EBA).

The letter points out that under the current regime, retail investors will receive two types of Key Information Documents (KID) – the documents that are to be provided to consumers before purchasing a PRIIP - as of 1 January 2020. The letter states this “is not satisfactory, and risks under-mining the aims of the PRIIPs Regulation". It also highlights that overlapping disclosure documents could deter investors rather than facilitate informed investment decision-making. The European Supervisory Authorities have urged the European Commission to bring forward solutions, including legislative changes, to resolve this situation.

EFAMA fully supports the ESA's timely intervention and calls for action prior to the review of the PRIIPs legislation, now expected to be delayed. This is in line with the concerns EFAMA previously raised around certain features and rules of the PRIIPs legislation and the harmful impact it could have on investors and consumers.

EFAMA believes that if the PRIIPs review is delayed, the UCITS exemption should be postponed accordingly to ensure investors do not receive confusing and misleading information in the mean-time. It strongly believes it would be counterproductive for the European Commission to replace the UCITS KID by the PRIIPs KID before a comprehensive review and thorough consumer testing have been conducted on PRIIPs. Failure to do so would have negative consequences for retail investors.

EFAMA believes that only when conducting the PRIIPs review should the Commission assess the future of the UCITS exemption, as is mandated in the law.

Peter De Proft, Director of General of EFAMA, commented: “The Commission's actions in failing to delay the UCITS exemption means that retail investors buying UCITS will be presented with a flawed PRIIPs KID instead of a well-functioning UCITS KID. This has a very real potential to mislead investors.

It will also have serious consequences, not only for European retail investors, but also for the credi-bility of the global UCITS brand, which is a success story that the European Commission has taken pride in.

The industry has repeatedly pointed out that the PRIIPs KID has major flaws. There is a complete lack of understanding as to why the Commission has not taken onboard the industry's concerns - and is now intending to extend the regulation to UCITS products, apparently because the review cannot happen in time. This is legally questionable and contradictory with the spirit of the law and the mission of European legislators."

Peter De Proft continued: “The regulation should not be applied to UCITS until the fundamental flaws of the PRIIPs KID have been appropriately resolved. The negative impact of the PRIIPs rules on retail investors and consumers, the people it vowed to protect - is very real. We are calling again on the European Commission to take urgent action to avoid hindering retail investors' trust and understanding of UCITS around the globe. This would be an extremely counterproductive legacy for them to leave."

EFAMA has produced an evidence paper providing both real data and evidence supporting the fact that the PRIIP KID is causing serious detriment to retail investors and concrete suggestions for solutions to some of the main flaws of the legislation, including the calculation of transaction costs and the disclosure of future performance scenarios. EFAMA has asked the Commission to resolve these issues.


• Currently, UCITS and AIFs producing a UCITS KID (under the UCITS Directive) are ex-empted from producing a PRIIP KID until (at least) 31 December 2019
• The reason for this was to give enough time to the PRIIPs Regulation to be implemented and for the European Commission to assess its impact before expanding its original scope
• European legislators (European Parliament and Council) explicitly called on the European Commission to consider, as part of the PRIIPs review due by 31 December 2018, whether (i) the UCITS exemption should be prolonged, (ii) the UCITS KIID should  be considered equivalent to the PRIIP KID or (iii) it should be replaced by the latter
• The European Commission announced a delay in the review of PRIIPs without delaying the UCITS exemption

– Ends –

For media enquiries, please contact:

Peter De Proft, Director General
Telephone: +32 (0) 2 513 39 69
Notes to editors:
About the European Fund and Asset Management Association (EFAMA):
EFAMA is the representative association for the European investment management industry, which represents 28-member associations and 62 corporate members. At end 2017, total net assets of European investment funds reached EUR 15.6 trillion. Close to 32,000 of these funds were UCITS (Undertakings for Collective Investments in Transferable Securities) and close to 28,300 of these funds were AIFs (Alternative Investment Funds). Including discretionary mandates, third-party regulated asset managers managed EUR 25 trillion in Europe at end 2017.  For more information about EFAMA, please visit