Overview
On March 27, the Belgian Financial Services and Markets Authority (FSMA) launched a consultation on a draft Royal Decree (the draft RD) amending the Royal Decree of April 25, 2014 concerning certain information requirements for the marketing of financial products to retail clients (the 2014 RD).[1]
FSMA is consulting all stakeholders interested in the marketing of retail financial products. The consultation is open until April 17, 2015. Comments can be sent by e-mail to: consult3@fsma.be.
The main purpose of the draft RD is to postpone the date of entry into force (currently, June 12, 2015) of certain provisions of the 2014 RD in the light of EU legislative initiatives relating to pre-contractual disclosures requirements for retail financial products.
The 2014 RD updates Belgian law on pre-contractual disclosures and advertising of retail financial products, including unit-linked life insurance contracts – known in Belgium as “class 23” contracts. Its scope therefore overlaps with that of the PRIIPs Regulation.[2] The 2014 RD was adopted before the PRIIPs Regulation was finalized. Furthermore, delegated acts which further specify the requirements of the PRIIPs Regulation have not yet been adopted.
According to the draft ministerial report, draft RD will achieve the following objectives:
- Avoid financial institutions, such as insurers, having to issue pre-contractual documents complying with the 2014 RD which then have to be amended to comply with the PRIIPs Regulation
- Allow the Belgian legislator to take into account other developments at the EU level, such as the proposed revision of the Insurance Mediation Directive – known as IMD 2
The draft RD would postpone the entry into force of the provisions of the 2014 RD relating to:
- The mandatory information note (fiche d’information/informatiefiche)[3]
- The voluntary information note[4]
- The requirements to indicate the label attributed to a product and provide numerical examples in advertising[5]
- Annex A setting out specimen information notes for different types of financial products
- Annex B specifying, for certain products, items of the information note that can be updated without prior approval by FSMA
The draft RD provides that the above provisions will enter into force on a date set by Ministerial order – in other words, to coincide with adoption of PRIIPs-related acts.
In sum, by consulting on the draft RD, FSMA – and the Belgian legislator – appear to have realised that the 2014 RD may have been premature in light of continuing EU initiatives on pre-contractual disclosure requirements for retail financial products.
If you have any questions concerning this briefing, please contact Philip Woolfson at pwoolfson@steptoe.com or Guy Soussan at gsoussan@steptoe.com.
[1] The consultation documents are available at http://www.fsma.be/fr/Doormat/Consultations/Cons.aspx.
[2] Regulation (EU) No 1286/2014 of the European Parliament and of the Council of 26 November 2014 on key information documents for packaged retail and insurance-based investment products (PRIIPs).
[3] Title 2 of the 2014 RD.
[4] Article 10 of the 2014 RD.
[5] Articles 12 §1, 4°, c) paragraphs 1 and 2, 14 and 23 of the 2014 RD.
