ESA Joint Committee · priips-26 Final

Would a hedge fund that meets the following criteria be considered a Category 1 or Category 3 PRIIP?

Regulation
PRIIPs
Answered
2017-07-04
Answer provided by
ESAs (EBA, ESMA, EIOPA)
More Q&As on this regulation →
⚠

Joint Committee Q&As are published in consolidated PDF documents without explicit question/answer delimiters. Section boundaries below are identified automatically and may occasionally be imprecise.

Question

Would a hedge fund that meets the following criteria be considered a Category 1 or Category 3 PRIIP?

Answer

The criteria are: the hedge fund invests in transferable securities, these transferable securities are valued daily, the hedge fund has quarterly (or less frequent) redemption right, hedge fund is able to use leverage. A determination as a Category 1 PRIIP overrules the other categories; thus where a PRIIP satisfies the conditions for a Category 1 PRIIP it shall be classified as a Category 1 PRIIP irrespective of whether it also meets the conditions of another category. The historic availability of price data relates to the frequency of the calculation of the NAV, not the frequency of redemption rights. That means it is a Category 3 PRIIP if there is sufficient historic data from the hedge fund or a benchmark available.
View original on ESA Joint Committee (EBA, ESMA, EIOPA) ↗

This Q&A is published by ESA Joint Committee (EBA, ESMA, EIOPA) and is non-binding. It does not constitute legal advice. Updated weekly from official ESA sources.

Similar Q&As

How should the requirement to use data of an appropriate benchmark/proxy be interpreted where there is no, or insufficient, price data for the PRIIP or the underlying value. For example: - Would an op

Answered 2017-07-04

Packaged retail and insurance-based investment products (PRIIPs)

Answered 2025-12-02

The main difference between Category 2 and Category 3 is, in accordance with Annex II Part 1 Point 5, whether the condition of "constant multiple" is fulfilled. In the event where a UCITs product has:

Answered 2025-12-05

Is the provision in Annex II, Part 1, Point 14 (b) applicable where a fund has sufficient history?

Answered 2017-07-04

Could you confirm if products with recurring premiums are to be modelled as Category 2 PRIIPs or Category 3 PRIIPs?

Answered 2023-12-05

📋 Track EU financial regulation continuously

Forseti monitors EU financial regulation and delivers personalised alerts anchored to verified official sources.

Start free trial → Learn more

14-day free trial. No credit card required.