Marketing Communications in Luxembourg Private Banking: MiFID II, PRIIPs and Fund Marketing
Private banking marketing communications in Luxembourg may fall under different regimes depending on the product, client and role of the bank.
Directive 2014/65/EU on markets in financial instruments (“MiFID II”) sets the investment-services communication standard. Under Article 24(3), client information, including marketing communications, must be fair, clear and not misleading, and marketing must be identifiable as such.
Regulation (EU) No 1286/2014 on packaged retail and insurance-based investment products (“PRIIPs Regulation”) matters where a bank advises on or sells a packaged retail or insurance-based investment product (“PRIIP”) to a retail client. The key information document (“KID”) is not another product pitch. It is the legal product summary against which marketing must be checked. The KID must be provided early enough for the retail client to read it before committing to the product; Article 13 does not set a fixed number of days.
Regulation (EU) 2019/1156 on cross-border distribution of collective investment undertakings (“CBDF Regulation”) governs fund marketing. Article 4 requires marketing for undertakings for collective investment in transferable securities (“UCITS”) and alternative investment funds (“AIFs”) to be identifiable, fair, clear and not misleading, and to present risks and rewards with equal prominence. Article 4(2) protects UCITS prospectus and key investor information. Article 4(4) protects AIF investor disclosures under Article 23 of Directive 2011/61/EU.
Operationally, Article 72 of Delegated Regulation 2017/565 together with Annex I to that Delegated Regulation, requires relevant MiFID records to be kept.
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