Update of ESA Q&As on the PRIIPs KID

On 5 December 2023, the European Supervisory Authorities (“ESAs”) jointly published an updated version of their consolidated Q&A on the PRIIPs Key Information Document (KID) (“Consolidated Q&A”) which now features seven additional questions/answers.

In particular, the ESAs confirmed that, in a fund context, the PRIIP manufacturer shall typically be the IFM (i.e. the UCITS management company or the AIFM, as the case may be) or the fund itself only in case of self-managed UCITS or internally managed AIF. Former interpretations, based on the definition of the PRIIPs manufacturer in the PRIIPs Regulation, leading to the qualification of the board of the fund or the portfolio manager (which may have initiated and designed the PRIIPs and/or may change their costs structure) are no longer acceptable according to the ESAs.

This clarification seems to mirror the responsibility and duties primarily allocated to the management company under the UCITS Directive implementing measures in the context of the UCITS KIID.

The Consolidated Q&A also provides further guidance on the following topics:

• representation in two separate KIDs of a product linked to one single ISIN code which is allowing both single and regular premium payments, under section “I. General Topics”;
• product categorisation of products with recurring premiums, under section “III-A. Market Risk assessment – Product categories”;
• consideration in the minimum scenario of the sum of rents paid up to the period in a context of life annuities, under section ”IV. Performance Scenarios”;
• the data to be used for calculating the performance scenarios in case the net asset value is calculated more than once per month, under section ”IV. Performance Scenarios”;
• clarification of an apparent contradiction in Annex IV, Case 3 of the PRIIPs Delegated Regulation 2017/653 regarding the performance scenarios and SRI calculation, under section “IV. Performance Scenarios”; and
• the information to be included in the KID of multi-option products, under section “X. Multi-option products (MOPs)”.