European Commission tightens conditions for receiving incentives for the distribution of funds under advice
25 MAY, 2023
Valdis Dombrovskis, Executive Vice-President for an Economy that Works for People, and Mairead McGuinness, Commissioner for Financial Services, Financial Stability and Capital Markets Union.
The Commission has adopted a Retail Investment Package that places the consumers' interests at the center of retail investing. The aim is to empower retail investors (i.e. “consumer” investors) to make investment decisions that are aligned with their needs and preferences, ensuring that they are treated fairly and duly protected. This will enhance retail investors' trust and confidence to safely invest in their future and take full advantage of the EU's Capital Markets Union.
One of the Commission's three key objectives of the 2020 Capital Markets Union Action Plan was to make the EU an even safer place for citizens to invest in the long term. The package aims to achieve that goal and encourage participation in EU capital markets, which has traditionally been lower than in other jurisdictions, such as the United States – even though Europeans have very high savings rates. Boosting the Capital Markets Union is also an essential means to channel private funding into our economy and to fund the green and digital transitions.
The Package in detail
The package includes ambitious and wide-ranging measures to:
Today's package is wide-ranging in scope and touches on the entire investment journey of the consumer. It consists of an amending Directive, which revises the existing rules set out in the Markets in Financial Instruments Directive (MiFID II), the Insurance Distribution Directive (IDD), the Undertaking for Collective Investment in Transferable Securities (UCITS) Directive, the Alternative Investment Fund Managers Directive (AIFMD), and the taking-up and pursuit of the business of Insurance and Reinsurance Directive (Solvency II), as well as an amending Regulation, which revises the Packaged Retail and Insurance-based Investment Products (PRIIPs) Regulation.
