Learn the PRIIPs & Key Information Document (KID) in 2025

Towards the end of this blog post, we conclude with an overview of the knowledge and skills gained upon successful completion of the course "Learn the PRIIPs Regulation & Key Information Document (KID) in 2025."

Understanding the PRIIPs Regulatory Framework

The Lamfalussy Process, introduced in 2002, established a four-level system for developing financial services legislation within the EU. Its purpose is to ensure that European regulations remain flexible, detailed, and effectively supervised.

At Level 1, the European Parliament and the Council adopt framework acts, directives or regulations forming the legislative foundation. Level 2 introduces Delegated and Implementing Acts, drafted with technical input from the European Securities and Markets Authority (ESMA). These acts clarify procedures and defined detailed provisions such as Regulatory Technical Standards (RTS) and implementing Technical Standards (ITS). Level 3 consists fo ESMA Guidelines and Recommendations, which aim to ensure consistent supervisory practices and uniform interpretation across Member States. Finally, Level 4 focuses on supervision, where ESMA and national authorities such as CySEC oversee the application and enforcement of the European acts.

Within this framework, the PRIIPs Regulation (EU No 1286/2014) sets out rules governing Key Information Documents (KIDs) for retail investment and insurance-based products. CySEC supervises compliance through a series of circulars, including C279, C312, C430, C536, C544 and C602, supported by ESMA's Q&As and ongoing guidance.

The PRIIPs Regulation requires that all investment and insurance-based products offered to retail investors include a standardised Key Information Document. This ensures transparency and comparability, enabling investors to make informed decisions before purchasing a product. 

A central component of the course is understanding the EU’s structured approach to financial regulation through the Lamfalussy Process. This multi-tiered legislative framework, comprising Levels 1 through 4, outlines how EU financial regulations like PRIIPs are developed, implemented, and supervised. In this course, participants will learn how the framework influences KID requirements and how the European Securities and Markets Authority (ESMA) and local regulators enforce consistent application across member states.

 
The Regulation applies to:

• Manufacturers of PRIIPs, including Investment Firms, Fund Managers, insurance undertakings, and credit institutions.
• Advisors and distributors offering or selling PRIIPs to retail clients.

Manufacturers must prepare a KID that clearly describes the product's objectives, risks, costs, and performance scenarios. The KID must be limited to three pages, presented in plain language, and translated into the official language of the investor's Member State.

Products exempt from PRIIPs include non-life insurance, certain pension schemes, and non-structured deposits. However, most retail investment and insurance-based products fall under its scope, including AIFs marketed to well-informed or retail investors.

Competent authorities such as CySEC and the Central Bank of Cyprus hold enforcement powers to suspend or prohibit the marketing of non-compliant product and to issue public warnings. 

Requirements of a Key Information Documents (KID)
The Key Information Document (KID) is designed to help investors, understanding the product they are considering. I must describe its nature, objectives, risks, potential gains or losses, and associated costs. Investment firms must provide the KID before concluding a transaction and must also conduct appropriate client assessments, including suitability or appropriateness tests under MiFID II in order to ensure that the product matches the client’s profile and risk tolerance.

Each KID must:

• Be concise and easy to read (maximum three A4 pages).
• Include details on the product type, distributor, and target market.
• Explain the Summary Risk Indicators (SRI), expected returns, and possible performance scenarios.
• Disclose all costs - direct, indirect, one-off, and recurring.
• Specify the recommended holding period, potential penalties for early withdrawal, and whether a cooling-off period applies.
• Clarify the Investor Compensation Fund (ICF) coverage if the firm becomes unable to pay investors, with compensation up to the lower of €20 000 or 90 % of the claim. 
• Provide instructions on how to submit a complaint and the contact details of the Financial Ombudsman.

A KID must remain separate from marketing material but may include references to legally required documents and the firm's website for further information.

CySEC's Thematic Review - Circular C312
In May 2019, CySEC published its first thematic review on KIDs under Circular C312, approximately 18 months after the implementation of MiFID II and the PRIIPs Regulation. Although MiFID II and PRIIPs are distinct frameworks, both share the core objective of investor protection.

The review identified several deficiencies. Many firms did not prepare a separate KID for each investment product or exceeded the size limit set by the Regulation. KIDs were often not translated into the official language of the Member State, limiting retail investor access. The content of some KIDs lacked essential product details and warnings and, in certain cases, was used for marketing purposes, contrary to regulatory requirements.

The syllabus of the  Learn the PRIIPs Regulation & Key Information Document (KID) in 2025  includes:

The Learn the PRIIPs Regulation & Key Information Document (KID) in 2025 course offers materials in both PDF slides and online video recordings, allowing for flexible, self-paced learning. Enrolled learners can study anytime and anywhere at their convenience.

After completing the course, participants can assess their understanding of the material through a set of knowledge-based questions.

Additionally, this course contributes to the annual Continuous Professional Development (CPD) requirements for professionals, including those with CySEC Advanced and Basic certifications.