The Norwegian Government proposes new bill to implement the PRIIPs Regulation: Requirements for investment product information

On 16 February 2024, The Norwegian Ministry of Finance proposed a new act aimed at implementing the PRIIPs Regulation into Norwegian law. PRIIP stands for Packaged Retail and Insurance-based Investment Products, which typically includes alternative investment funds (AIFs), securities funds, structured bank deposits and life insurance policies with investment options for policyholders.

The PRIIPs Regulation requires manufacturers, advisers, and sellers of PRIIPs to provide consumers and other non-professional investors with key information about the product prior to investment. Manufacturers shall prepare a standardised key information document (KID) for the product intended for non-professional investors and publish the document on their website. Advisers and sellers of PRIIPs shall provide the key information document in good time before the non-professional investor is bound by a contract or offer relating to the PRIIP.

The purpose of the PRIIPs Regulation is to ensure that consumers and other non-professional investors receive information about the characteristics and risks of packaged retail and insurance-based investment products, for them to better understand and compare the products before making investment decisions.

The PRIIPs Regulation is proposed to be incorporated into Norwegian law as such, however The Norwegian Ministry of Finance proposes that the Ministry also be granted authority to, through regulations, provide detailed rules to supplement the act, including rules on the drafting of key information. Additionally, the Ministry proposes to be granted authority to, through regulations, make amendments to, and establish exceptions from, the provisions implementing the Regulation.

The Norwegian Ministry of Finance also proposes that the Ministry be granted regulatory authority to extend the substantive scope of the Norwegian PRIIPs Act to other types of investment products than those covered by the PRIIPs Regulation, provided that a draft of such regulation should be subject to public consultation.

For life insurance companies, fund managers, and other entities offering PRIIPs, the new act will entail several new information requirements that manufacturers, advisers, and sellers of PRIIPs must acquaint themselves with before the act comes into force. The proposed bill also includes provisions on language, supervision, administrative measures, penalties for breaches and confidentiality.

The proposed legislation will now be processed in the Norwegian Parliament, alongside a proposal for consent to the approval of two EEA Joint Committee decisions on incorporating the PRIIPs Regulation and certain associated legal acts into the EEA Agreement. The earliest possible date for the Norwegian PRIIPs Act to come into force is, in practice, 1 July 2024, but we assume it more likely that the entry into force will be on 1 January 2025.