Commission call for evidence concerning Packaged Retail Investment Products
18 January 2008
This call focuses on whether the fragmented regulatory landscape leads to unacceptably high variations in the level of product disclosure and investor protection, depending on the regulatory status of the investment product.
There is concern that conflicts of interest may influence the range of investment products to which retail investors have access, and that investors may be sold products which are 'unsuitable' for their profile. There is also a fear that less transparent or regulated products may be easier to sell, thereby displacing more heavily-regulated products and exacerbating investor protection concerns.
This call for evidence focuses on whether the fragmented regulatory landscape leads to unacceptably high variations in the level of product disclosure and investor protection, depending on the regulatory status of the investment product. It does not call into question differences in the rules governing the authorisation or prudential supervision of the institutions which originate these products. These institutions employ different financing methods and incur different types of risk which need to be taken into account in the relevant prudential frameworks.
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