New BaFin Circular – Can Asset Investments Still Be Packaged Products Under the PRIIPs Regulation?

Asset investments continue to enjoy unwavering popularity in Germany as a means of financing companies and projects, and are defined and regulated by the Asset Investment Act (VermAnlG). Therefore, anyone wishing to issue such an asset investment and offer it publicly in Germany must comply with the regulatory requirements of the VermAnlG. However, the VermAnlG applies only if the offering does not fall within the scope of European Regulation (EU) 2020/1503 (Crowdfunding Regulation) or Regulation (EU) 2023/1114 (MiCAR). According to the wording of section 1(2) of the VermAnlG, products may not constitute asset investments within the meaning of the law if they qualify as securities under the Securities Prospectus Act or as units in investment funds under the Capital Investment Code, or if the funds raised are classified as deposits under the German Banking Act. However, if the product to be issued is an asset investment to which the VermAnlG applies, issuers and offerors must, among other things, also comply with the documentation and prospectus requirements arising from the VermAnlG. But what specific obligations must issuers and offerors fulfill in this context?

What Prospectus and Documentation Requirements Must Providers of Asset Investments Comply With?

In general, providers must prepare a sales prospectus in accordance with the requirements of sections 6 et seq. of the  VermAnlG before commencing a public offering of asset investments, have it approved by BaFin as the competent supervisory authority, and then publish this sales prospectus. However, the VermAnlG also provides for exceptions to these obligations. For example, offerings limited to twenty units of the same type of asset investment do not require a prospectus. The same applies to offerings whose total volume does not exceed EUR 100,000, as well as to offerings whose price per single unit is not less than EUR 200,000. In addition, there are exceptions for crowdfunding projects under the VermAnlG, as well as social projects and charitable and religious projects. In addition to the requirement to publish an approved sales prospectus, providers of asset investments must generally also prepare a so-called Asset Investment Information Sheet (VIB) and file it with BaFin after receiving its approval. This requirement also applies to asset investments for which a public offering is permitted without a sales prospectus because they fall under the exception for crowdfunding projects under the VermAnlG or under the exception for social projects. However, the obligation to prepare and file a VIB does not apply in any case if a Key Information Document (BIB) must already be published for the public offering of the asset investment in accordance with Regulation (EU) No. 1286/2014 (PRIIPs Regulation).

When is a KID Required for Asset Investments?

Under the PRIIPs Regulation, manufacturers of packaged investment products for retail investors must prepare and publish a KID. In such cases, the provider must, in any event, also target retail investors in the public offering of the asset investment. It can be difficult to determine on a case-by-case basis when a product is “packaged” within the meaning of the PRIIPs Regulation. Under the PRIIPs Regulation, a product is considered a packaged investment product if the amount to be repaid is subject to fluctuations due to its dependence on reference values or the performance of one or more assets that are not directly acquired by investors. According to BaFin, the amount to be repaid includes both interest and principal. BaFin further notes that the type of reference value is also a factor. According to this, the repayment amount’s dependence on internal reference values or interest rate indices—such as the Euribor—does not constitute a packaged product; dependence on external reference values, on the other hand, does. The exact classification is therefore always a matter of the individual case.

According to the BaFin Circular of July 27, 2026, Asset Investments are Rarely Packaged Products

In its circular dated July 27, 2026, BaFin now clarifies that it generally does not classify asset investments as packaged investment products under the PRIIPs Regulation. It justifies this by stating that asset investments typically have the character of equity interests in companies and are therefore comparable to stocks. Such equity interests are exempt from the PRIIPs Regulation. According to this, the key factor in classifying asset investments is generally that they serve an equity-like function. Asset investments are therefore either part of the issuer’s equity or, in principle, have an equity-like character. Consequently, most asset investments are generally not to be classified as packaged investment products within the meaning of the PRIIPs Regulation. Already in the first part of the circular—the introduction—BaFin clarifies that providers of asset investments must therefore generally prepare a VIB and have it approved by BaFin. The approved VIB must then be filed with BaFin. Providers of asset investments that are planning a public offering in the future should be sure to take this clarification from BaFin into account in their planning and when drafting the required documentation. Providers of currently ongoing public offerings, particularly those who have published a BIB for their public offering, should urgently review the documents they have published or filed to ensure they are complete and accurate, or have them reviewed by specialized attorneys.

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