Last December, the FCA published its final rules for Consumer Composite Investments (CCIs), setting out how investment information should be clearer, more consistent and easier for people to act on.
These new rules replace the Packaged Retail and Insurance-based Investments Products (PRIIPs) Regime and the Undertakings for Collective Investment in Transferable Securities (UCITS) disclosure requirements. It’ll bring everything into a single, UK-focused framework.
The FCA hopes this will empower the 12.5 million UK adults holding CCIs to invest in the future with more confidence and understanding of costs, risks and potential returns.
Alongside targeted support, this is linked to the Government’s objective of creating a stronger retail investment culture in the UK, benefitting consumers and providing capital to boost UK economic growth.
There’s an 18-month transition period running until 8 June 2027. However, manufacturers of CCIs are being given the flexibility to move to the new Product Summaries from as early as 6 April 2026.
Advisers will want to get to know what’s coming, so they can confidently guide customers through the transition window.
What’s classed as a CCI?
A CCI is an investment where returns depend on how an underlying asset or market performs. This includes all products in scope of PRIIPs and UCITS, such as open-ended funds, closed ended investment funds (CEIFs), structured products, contracts for difference, and insurance-based investment products.
Pension products and pure protection policies aren’t included in the new rules, so customers who hold these as well as CCIs will see two different disclosure regimes.
There’s also the potential for customers with SIPPs to receive CCIs for certain underlying investments – the CCI manufacturer may not know these are being held in a SIPP.
What’s changing: new disclosure requirements
Manufacturers will need to provide two sets of information and data.
For the use of distributors, which could include both advisers and platforms distributing CCIs, they must provide general product information, costs and charges, performance and risk information – all in a machine-readable format.
For retail customers, they must produce a clear, consumer-friendly Product Summary that includes the above information.
Introducing Product Summaries: the KID replacement
The FCA is moving away from the rigid, highly templated Key Information Document (KID) used under PRIIPs. Following Consumer Duty, firms now have the freedom to design Product Summaries that are clearer, more engaging and easier for customers to understand.
While some standard metrics still need to be included to allow customers to compare products, firms can decide what else to include – like ESG features, for example. Time will tell how short and simple the end results will be, and what approach each manufacturer takes.
The FCA had originally suggested that distributors might be expected to review and, if necessary, adapt Product Summaries for their clients. I’m pleased for the sake of advisers, platforms and end consumers that this idea has been dropped.
Instead, distributors will share the full manufacturer Product Summary with customers. There’s the option to highlight key information that’ll help clients make an informed decision. Platforms are unlikely to do this, but advisers may have views on what to highlight to their specific client banks.
As with KIDs, product summaries must be made available before a sale and provided in a durable medium at the point of sale, or shortly after.
How costs and charges will be displayed
Product Summaries must include a headline ongoing charges figure (OCF) as both a percentage and in pounds-and-pence. For most CCIs, this OCF will include or ‘pull through’ the costs of any underlying funds.
Explicit transaction costs must be disclosed but can sit alongside charges or as part of an explanation of the product’s investment strategy. It’s been decided that implicit transaction costs aren’t included.
One-off entry or exit charges will also be shown separately – which will more accurately show these to affected customers.
New risk and return scoring explained
The FCA wants CCIs to give customers a more rounded view of risk and return so people can make informed decisions – without feeling that the risks are being overstated. What was previously described as a ‘risk’ score will now become a ‘risk and return’ score, which I see as more balanced.
The current 1-7 risk and return scale in KIDs is being replaced by a 1-10 scale to allow greater differentiation between products. The final rules set out how firms should calculate the score, based on the standard deviation of returns over the past 10 years. Manufacturers can adjust the score if it’s not representative of the product, but within certain limits.
There are also certain product-specific rules. Most illiquid investments will lead to an increase of at least 1 in the rating, and there are specific rules for structured products based on ‘value-at-risk equivalent volatility’. Venture Capital Trusts and Enterprise Investment Schemes will automatically be rated 9.
Information on inflation risk isn’t prescribed in the new framework, but advisers distributing CCIs may still want to highlight this where relevant to customers.
How past investment performance must be shown
Product Summaries will include a line graph showing the product’s investment performance over the past 10 years (if available) based on an initial £10,000 investment. This must show monthly data points to illustrate how the investment has moved over time.
In some cases, a relevant benchmark must also be shown on the line graph to show performance against this.
General product information
While the aim is to simplify disclosures, regulations still include a long list of information CCI Product Summaries must include.
You can find this in Section 4 of a new Annex K to the COBS rules. Again, I feel this will make the production of short, simple documents challenging!
Next steps for advisers and platforms
The new regulations come into effect on 8 June 2027, but some manufacturers may decide to switch from KIDs to Product Summaries from as early as 6 April 2026. This means platforms and advisers may need to contend with two very different consumer-facing disclosure documents from different manufacturers for similar products.
During this time though, it’s vital that distributors provide retail customers with the disclosure document the manufacturer creates.
Platforms will be working with technology partners on how best to adapt existing processes and customer journeys to help them handle different disclosure documents during the transition.
Advisers will need to spend time familiarising themselves with both formats so they can clearly explain recommendations when comparing different CCIs. Hopefully, longer term, the new approach will assist consumers make more informed choices.