The European Parliament has rejected – for the first time – a set of technical standards that could have hurt high street investors.
The vote in Strasbourg follows a recommendation from the European Parliament’s economics committee earlier this month to vote down measures relating to Packaged Retail and Insurance Based Investment Products (PRIIPS) such as investment funds, insurance products and derivatives. The European Commission had proposed ‘Regulatory Technical Standards’ for PRIIPS under their so-called ‘delegated acts’ powers, giving the European Parliament the opportunity to overturn them. Although rarely used in financial matters, a cross-party grouping of MEPs invoked the powers to reject the rushed proposals, and ask the commission to listen to legitimate concerns from companies that provide these financial products.
One of the leading MEPs seeking this rejection has been European Conservatives and Reformists (ECR) Chairman and London MEP Syed Kamall.
After today’s vote in Strasbourg, he said:
“This is the first time ever that the parliament has used its powers to reject technical standards in this way, but we have been left with no choice but to press the nuclear button. These current proposed standards could hurt high street investors.
“A cross-party group of MEPs has spent many hours scrutinising and amending this legislation. We are fully behind giving clear and accurate guidance to investors, but we will not accept poor and inaccurate legislation in a rush to get the regulation into force.
“Unless we get this right it is consumers who will suffer. For example, the average high street investor looking to open a new ISA account could be given unclear misinformation because their provider was required to do so by this regulation. The European Commission will now have to go back to the drawing board and come up with something that will actually deliver.”