Information on services and costs of financial products
Do you offer or broker financial products or services in the Netherlands, for example investments, insurances, loans, or mortgages? You have to provide correct and clear information. You must provide this information before you close a deal. The Dutch Authority for the Financial Markets (Autoriteit Financiële Markten, AFM) determines which requirements your information must meet.
Information on financial products and services
The AFM sets the requirements per product and service (in Dutch) with which your information must comply. This applies for example to offers, product information folders and advertising. The information must be comprehensible and may not be misleading.
Duty of care
Are you a financial adviser, mediator, or agent? You have a duty of care for your customers (in Dutch). For example, you have to:
- regularly check if your product still fits your client’s situation
- notify your client immediately if the product of contract changes
You may only sell financial products that benefit your customer. In case of abuse AFM can intervene and impose sanctions.
Essential information document (Eid)
For many financial products and other investments and insurance products with investment elements (Packaged Retail and Insurance-based Investment Products, PRIIP) an Essential information document (Eid) (in Dutch) is mandatory. With an Eid you inform your customer on, among others, the risks, expected returns, and other important issues. An Eid helps your customer understand and compare the products you offer.
Investment-linked insurances
Do you sell investment-linked insurance policies (investing money through insurance)? Then you must meet several requirements, such as:
- make sure your clients understand their own situation
- give your clients information about the results and offer possible chances for improvement, if there are any
- offer your clients the choice to either end, change, or continue their policy
If you fail to do so, you may be fined by AFM.
Offering loans
Do you offer loans (credit)? You must inform your clients about the credit conditions and costs before concluding the credit agreement. Your client can still cancel the credit agreement without stating reasons within 14 days. Your client may also cancel the agreement if you included a condition in the agreement that you did not mention in advance.
Offering mortgages
Do you offer mortgages? You must offer clear information. For example, you have to explain the structure of the variable interest rate to your client. You must do this before concluding the mortgage. If the fixed-interest period is set to expire, you must make a new offer at least 3 months in advance.
Comparison document and ban on commissions
Commission is money that an adviser gets from a bank or insurer as a remuneration for the products they sell to a customer. For a number of products, this is no longer allowed. A so-called ban on commissions applies to those products.
Do you give advice about, or do you sell financial products that are subject to the ban on commissions? You have to provide a comparison document (Vergelijkingskaart in Dutch) to your clients. With this document consumers can easily compare services and costs. The comparison document replaces the service provision document DVD (Dienstverleningsdocument).
Prospectus
Do you want to offer transferable securities, such as shares and bonds, to the public? Or do you want to trade them on a regulated market? In most cases you will have to publish a prospectus. Your prospectus will set out the terms of the issue. The prospectus needs to be approved by the AFM.