Edinburgh reforms: Government plans to revoke the PRIIPs Regulation

The UK PRIIPs Regulation will be revoked "as a matter of priority" once the new Financial Services and Markets Bill becomes law, to be replaced with a new retail disclosure framework set out by the FCA. 

Among the other measures set out in the Government's "Edinburgh reforms" package, HM Treasury set out a consultation on its plans to revoke the EU-derived PRIIPs Regulation, on the basis that that the PRIIPs regime led to confusing disclosures and limited consumer choice. In particular, the Government noted that the PRIIPs Regulation's ambition to enable easy comparisons of packaged products was not feasible and could result in "misleading and unhelpful information being presented to retail investors". 

In line with the Government's Future Regulatory Framework proposals, rules on retail disclosure will in future be found primarily in the FCA Handbook. Instead of the focus on comparability, the Government intends that the retail disclosure regime should ensure that an investor is empowered to make well-informed decisions on the product they are purchasing.

The Government also proposed to scrap the transition planned in 2026 from the UCITS key investor information document (KIID) regime to the PRIIPs regime, instead empowering the FCA to "integrate UCITS and PRIIPs disclosure into a coherent UK retail disclosure framework" before 2026. 

HM Treasury does not propose providing the FCA with any additional powers in the Financial Services and Markets Bill to deliver this retail disclosure regime.

The consultation also requested views on:

• initiatives the Government could take to improve retail investor access to investment products from other jurisdictions; and
• digital disclosure, noting that the revocation of the PRIIPs Regulation should lead to a less prescriptive disclosure regime; and
• any other priorities the Government and FCA should pursue for retail disclosure reform. 

The PRIIPS and UK retail disclosure consultation closes on 3 March 2023.