The move from UCITS to PRIIPs was undoubtedly one of the hot topics of FundForum International 2021. It was presented and discussed as part of the thought leadership programme, and it came back in many of the conversations surrounding the conference.
Although at the time of writing, an official announcement from the European Commission has yet to be published, the grandfathering period for UCITS funds under PRIIPs is expected to come to an end no earlier than 30th of June 2022, and no later than end of 2022. While this would mean another 6 to 12 months’ extension, now is the time for asset managers to prepare.
Now is the time to prepare
Although an extension by 6 or 12 months may sound like good news, it means that asset managers will need to run another annual revision of the UCITS KIID in Jan/Feb 2022 – in parallel to all the preparations needed to be ready to create PRIIPs KIDs by the end of the grandfathering. Additionally, a new version of the European PRIIPs Template (EPT) is expected, to which asset managers will need to adapt also.
Although the commission may be granting another 6-12 months extension, this additional time window is small in the context of preparing for the switch from KIID to KID, therein particular for insurers who depend on the PRIIPs data/documents to ensure compliance for their multi option products, as they will typically expect to receive this information some months in advance of the new regulatory deadline.
For managers of UCITS funds, the move to PRIIPs represents a significant project and an opportunity to rethink how they manage investor disclosure. The switch will bring high levels of complexity, notably in terms of data gathering and calculations, as well as increased workloads and ultimately costs. But before they can even start planning, asset managers will need to familiarize themselves with all requirements under the new final Regulatory Technical Standard (RTS) of PRIIPs, and understand the scope of share classes subject to PRIIPs. The availability of the required price history and additional datapoints will also need to be checked.
In addition, even asset managers who do not yet produce PRIIPs KIDs for any of their funds might know that it comes with similar but also additional challenges to the UCITS KID. Producing PRIIPs documentation can be complex as standard calculation methodologies must be followed to calculate risk, performance scenarios and cost. The calculation of transaction cost can be time consuming, when not done in an automatic and efficient fashion. The content, calculation results in KIDs must be presented in a compliant way, in accordance to the final Regulatory Technical Standards.
Last but not least, asset managers will need to plan sufficient time for new narratives and their translations, as well as the regulatory filing of validated KIDs to the countries of distribution of the funds.
Simplify and accelerate PRIIPs compliance
Kneip has been producing PRIIPs KIDs since January 2018, the initial application date of PRIIPs. We simplify and accelerate PRIIPS compliance and offer the flexibility to produce PRIIPs EPTs, CEPTs and KIDs in base language as well as in other languages. In addition, our experts ensure that our clients remain compliant with the latest regulatory changes and market best practices, through an active regulatory watch and our engagement in various associations and industry groups.
Kneip provides one solution to manage the creation, approval workflow and maintenance of PRIIPs KID documents, as well as EPT/CEPT, integrated with regulatory filing and dissemination to any destinations.
- Simple onboarding. Kneip does not impose strict formats or transmission protocols;
- Data consolidation made easy. Consolidation & central data storage (with segregation if needed);
- Accurate documents. Automatic quality controls, on file, channel and content level;
- True end-to-end solution. Cover all aspects of production with one platform (data integration, calculation, translation, production and monitoring) in combination with regulatory filing and dissemination;
- Future-proofed. Stay ahead of regulatory changes as Kneip ensures compliance with the latest PRIIPs rules, not only today but also in the future.
Even those asset managers who are confident about their ability to switch from UCITS to PRIIPs should be questioning the efficiency of their solution: does it integrate all investor disclosure documents? Does it allow for data re-use? Does it integrate with dissemination? The move from KIID to KID is an opportunity to rethink how to manage investor disclosure & fund marketing documents as a whole, and Kneip offers an end-to end investor disclosure solution with a global reach.
A partner of choice for investor disclosure
Kneip currently manages the data publication and investor disclosure for more than 10,000 funds in over 40 countries, and more than 30% of the ISINs in the EU are serviced by Kneip. We produce over 200,000 UCITS KIIDs and PRIIPs KIDs and over 250k EPTs per year and we are already working with over 65 asset managers on the production and dissemination of their required disclosers to support the end of the UCITS grandfathering.
Kneip can help you get ready – and stay ready – for PRIIPs. Our team would be delighted to discuss your specific challenges: don’t hesitate to get in touch with us. Our experts have also produced a range of free resources to support your preparations: watch our guide to preparing for the transition, download our PRIIPs checklist and put your PRIIPs KIDs to the test: our experts will test them and confirm that they are compliant.