A consumer body has criticised members of the European Parliament for, it says, only considering the views of the financial services industry in its proposal for rejecting draft rules for the Priips regulations.
Better Finance, which describes itself as a European federation of investors and financial services users, said its members back the Parliament’s proposed rejection of “misleading” and “overly complex” draft implementation rules under Priips, or Packaged Retail and Insurance-based Investment Products regulations – but for different reasons to politicians.
The European Supervisory Authorities drafted the proposed ‘regulatory technical standards’ for Priips – approved by the European Commission but facing rejection by MEPs – which would amend rules around how assetmanagers calculate and display fund charges and investment performance.
Better Finance says the officially stated rationale for rejection of the technical standards omits mention of the elimination of past performance disclosures, including that of product benchmarks, which Better Finance feels is the most “crucial and critical issue” for EU citizens as savers.
Omitting past performance from key information documents will prevent EU savers from knowing whether a product has made or lost money in the past, and whether it ever met its investment objective or promise, says the group. It will also prevent savers from comparing similar products, such as index and index-benchmarked funds, or choosing between different with-profit life insurance policies.
Better Finance also believes the proposed rules are inconsistent with the EU initiative for a Capital Markets Union, which calls for greater transparency on the past performance of long-term savings products.
MEPs will vote on the issue tomorrow.
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