contents table Lexparency.org lexp
On a pan-European Personal Pension Product (PEPP) (Text with EEA relevance)
Article 41

Article 41 — Investment rules

  1. PEPP providers shall invest the assets corresponding to the PEPP in accordance with the prudent person rule and in particular in accordance with the following rules:
    1. the assets shall be invested in the best long-term interests of PEPP savers as a whole. In the case of a potential conflict of interest, a PEPP provider, or the entity which manages its portfolio, shall ensure that the investment is made in the sole interest of PEPP savers;
    2. within the prudent person rule, PEPP providers shall take into account risks related to and the potential long-term impact of investment decisions on ESG factors;
    3. the assets shall be invested in such a manner as to ensure the security, quality, liquidity and profitability of the portfolio as a whole;
    4. the assets shall be predominantly invested on regulated markets. Investment in assets which are not admitted to trading on a regulated financial market shall be kept to prudent levels;
    5. investment in derivative instruments shall be possible insofar as such instruments contribute to a reduction in investment risks or facilitate efficient portfolio management. Those instruments shall be valued on a prudent basis, taking into account the underlying asset, and included in the valuation of a PEPP provider’s assets. PEPP providers shall also avoid excessive risk exposure to a single counterparty and to other derivative operations;
    6. the assets shall be properly diversified in such a way as to avoid excessive reliance on any particular asset, issuer or group of undertakings and accumulations of risk in the portfolio as a whole. Investments in assets issued by the same issuer or by issuers belonging to the same group shall not expose a PEPP provider to excessive risk concentration;
    7. the assets shall not be invested in a non-cooperative jurisdiction for tax purposes identified in the applicable Council’s conclusions on the list of non-cooperative jurisdictions for tax purposes, nor in a high-risk third country with strategic deficiencies identified by the applicable Commission Delegated Regulation adopted on the basis of Article 9 of Directive (EU) 2015/849;
    8. the PEPP provider shall not expose itself and the assets corresponding to the PEPP to risks stemming from excessive leverage and excessive maturity transformation.
  2. The rules set out in points (a) to (h) of paragraph 1 apply only to the extent that there is no more stringent provision in the relevant sectorial law applicable to the PEPP provider.