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The letter points out that under the current regime, retail investors will receive two types of Key Information Documents (KID) - the documents that are to be provided to consumers before purchasing a PRIIP - as of 1 January 2020. The letter states this "is not satisfactory, and risks under-mining the aims of the PRIIPs Regulation". It also highlights that overlapping disclosure documents could deter investors rather than facilitate informed investment decision-making. The European Supervisory Authorities have urged the European Commission to bring forward solutions, including legislative changes, to resolve this situation.

EFAMA fully supports the ESA's timely intervention and calls for action prior to the review of the PRIIPs legislation, now expected to be delayed. This is in line with the concerns EFAMA previously raised around certain features and rules of the PRIIPs legislation and the harmful impact it could have on investors and consumers.

EFAMA believes that if the PRIIPs review is delayed, the UCITS exemption should be postponed accordingly to ensure investors do not receive confusing and misleading information in the mean-time. It strongly believes it would be counterproductive for the European Commission to replace the UCITS KID by the PRIIPs KID before a comprehensive review and thorough consumer testing have been conducted on PRIIPs. Failure to do so would have negative consequences for retail investors.

EFAMA believes that only when conducting the PRIIPs review should the Commission assess the future of the UCITS exemption, as is mandated in the law.

Peter De Proft, Director of General of EFAMA, commented: "The Commission's actions in failing to delay the UCITS exemption means that retail investors buying UCITS will be presented with a flawed PRIIPs KID instead of a well-functioning UCITS KID. This has a very real potential to mislead investors. It will also have serious consequences, not only for European retail investors, but also for the credi-bility of the global UCITS brand, which is a success story that the European Commission has taken pride in. The industry has repeatedly pointed out that the PRIIPs KID has major flaws. There is a complete lack of understanding as to why the Commission has not taken onboard the industry's concerns - and is now intending to extend the regulation to UCITS products, apparently because the review cannot happen in time. This is legally questionable and contradictory with the spirit of the law and the mission of European legislators."

Peter De Proft continued: "The regulation should not be applied to UCITS until the fundamental flaws of the PRIIPs KID have been appropriately resolved. The negative impact of the PRIIPs rules on retail investors and consumers, the people it vowed to protect - is very real. We are calling again on the European Commission to take urgent action to avoid hindering retail investors' trust and understanding of UCITS around the globe. This would be an extremely counterproductive legacy for them to leave."