Brussels, 29th April 2009
Financial services: Commission proposes better investor protection measures for packaged retail investment products
The European Commission has committed to delivering important improvements to investor protection measures for the main investment products bought by retail investors. Inconsistencies in existing standards can be detrimental to investors and can lead to competitive distortions in the retail investment market. The Commission's conclusions, set out in the Communication on Packaged Retail Investment Products, are that product information requirements and rules on product sales need to be improved and made more coherent. The Communication outlines proposals for a new, horizontal legislative approach, drawing on the best of existing requirements and applying these to all relevant products. The Commission will now begin work on the detailed legislative proposals required for this new approach, and will provide an orientation on the work by the end of 2009.
Internal Market and Services Commissioner Charlie McCreevy said: "The financial crisis has underlined once again how important it is that retail investors are able to make informed investment decisions. It is vital that investors receive information they can trust and understand about the investments they make, and that those selling investments always treat investors fairly and focus on their needs. The ambitious programme of work we have announced today is designed to take us a good way towards this goal, by ensuring that information about and sales of packaged retail investment products are regulated to high and consistent standards."
The proposals focus on product disclosures and sales processes for all packaged retail investment products, such as investment funds, insurance-based investments and the various types of structured products. These products dominate the retail investment market, satisfy similar investor needs and raise comparable and important investor protection challenges.
The Communication does not contain detailed legislative proposals at this stage but sets out the high-level principles of a horizontal approach to product disclosures and selling practices and commits the Commission to bring forward legislative proposals to deliver these results.
More information is available at:
 Undertakings for Collective Investment in Transferable Securities