This overview provides a selection of relevant legal developments regarding financial services regulation including the new rules on PRIIPs, the commencement of the MiFID II regime and amendment of the remuneration rules.
As of 1 January 2018, the so-called PRIIPS regulation applies. This regulation introduces the obligation for manufacturers, sellers and advisers of packaged retail and insurance-based investment products (or PRIIPs) to provide retail investors with a key information document (or KID). The regulation basically applies to all products made available by the financial services industry to retail clients that provide an investment opportunity whereby the return is subject to underlying assets. The regulation does not apply in the case of professional investors or products made available outside the EEA only. The regulation does not provide for a passporting regime.
A KID is highly standardised. It must be no more than three pages in A4 format and must be published and provided to retail clients prior to contracting. For the Netherlands this means that the obligation to provide a financiële bijsluiter will no longer apply as it has been be replaced by a KID. There are certain differences between a KID and a financiële bijsluiter. A KID must be made available exclusively in Dutch if the product involved is marketed in the Netherlands.
Few transitional provisions apply, so manufacturers, sellers and advisers must comply with the regulation immediately. The main exemption relates to UCITS management companies and AIFMs who make a Key Investor Information Document (or KIID) available. They are exempt until 1 January 2020.
Much has been said and written about the new MiFID II regime. We won’t repeat this here. Instead, we reiterate certain important aspects of MiFID II, examples of which are new investment services (e.g., the OTF), new financial instruments (structured deposits, emission rights), increased transparency (e.g., on costs and the nature of advice rendered), increased regulatory pressure (e.g., on best execution, branch office requirements for non-EEA firms servicing non-professional clients and rules on commissions) as well as the tightening of certain exemptions (e.g., exemption for ancillary activities). In addition, the sanctioning powers of regulators will again be expanded. Finally, much of this regime will apply directly, i.e. without any transitional rules applying. Different amendments are relevant for different parties.
The DNB Regulation on sound remuneration policies 2014 has recently been replaced by the DNB Regulation on sound remuneration policies 2017. This amendment is in part due to overlapping Dutch rules as a result of various legislative changes. This amendment is due in part to changes on the EU level such as the EBA Guidelines on sound remuneration policies that already apply as from 1 January 2017 as well as the EBA Guidelines on remuneration policies related to the sale and provision of retail banking products and services that will apply as from 13 January 2018. Under the new DNB Regulation, certain financial institutions such insurance undertakings are no longer subject to the rules set out therein as the new regulation is limited to banks, investment firms and premium pension institutions. The new regulation basically implements articles 92 to 95 of CRD IV and article 23 of IORP.
Compliments of Houthoff , a member of the EACCNY