Fostering retail investors’ participation in capital markets is a key objective of CMU, however, in some instances, increased regulatory requirements have created unintended consequences. This is the case, for example, of corporate bonds markets where the requirements have become so onerous, it has become a lot less attractive for corporate bonds to be made available to retail. This, ultimately means retail investors can no longer access the majority of these instruments and that savings are not being mobilised to finance the economy.
FESE would like to call for a united effort by legislators and regulators at both European and national levels to acknowledge the burdensome situation around the PRIIPs Regulation and act in order to enable direct investments by retail investors in bonds once again. An important first step, would be to clarify that bonds with a make-whole call provision do not qualify as PRIIPs.