By Matt Ritchie
The European Commission has produced a legislative package aimed at strengthening confidence in financial services in the wake of the financial crisis, with new regulations covering Ucits and packaged retail investment products (PRIPS), and a revision of the Insurance Mediation Directive (IMD).
The Ucits changes include a precise definition of the tasks and liabilities of all depositaries acting on behalf of a Ucits fund, clear rules on the remuneration of Ucits managers to avoid pay structures that encourage excessive risk-taking, and a common approach to how core breaches of the Ucits legal framework are sanctioned.
Information quality around PRIPS was to be improved by the introduction of a key information document, and the IMD revision would seek to improve consumer protection through introducing common standards across insurance sales and ensuring proper advice.
European Commission internal market and services commissioner Michel Barnier said that in the aftermath of the crisis, the financial sector must place consumers at its heart.
“Retail products must be safer, information standards must become clearer, and those selling products must always be subject to the highest standards. That is why we have adopted a package solely dedicated to consumers, so that they can choose financial products based on clear and sound information and professional advice which puts the consumer's interests first,” Barnier said.