Why You Can’t Buy US ETFs From Europe (PRIIPs, Explained)

American expats in Europe discover a maddening squeeze. US tax law punishes European funds (the PFIC trap). And European consumer law blocks many US funds. Caught between two well-intentioned regulations, the ordinary index investor seemingly can’t buy anything. Here’s what’s actually going on — and the legitimate ways through.

PRIIPs in plain English

Since 2018, EU rules (PRIIPs) require that “packaged” retail investment products — which includes ETFs — may only be marketed to EU retail investors if they publish a standardised Key Information Document (KID). US ETF providers generally haven’t produced KIDs (their home regulator has different requirements), so EU-based platforms won’t let retail clients buy them. Nothing about this is aimed at Americans — it catches anyone shopping from an EU address.

The four realistic paths through

1. A US brokerage relationship

PRIIPs governs marketing to EU retail investors by platforms operating in the EU. Many Americans abroad simply continue investing through their existing US brokerage, where availability depends on the broker’s own expat policy. This is the most common working setup — one reason we bang on about choosing the right brokerage before moving.

2. Professional / elective professional status

PRIIPs protects retail investors. Investors who qualify (and elect) to be treated as professional clients — there are portfolio-size and experience thresholds — can regain access to US ETFs on some platforms. Realistic for larger portfolios; irrelevant for most.

3. Options-based workarounds

On some platforms, exercising options can result in ETF shares being delivered — a workaround occasionally used by determined investors. It’s convoluted, costs money and demands understanding of options mechanics. We mention it for completeness, not as a suggestion.

4. Individual stocks and other non-packaged assets

PRIIPs doesn’t touch individual stocks or bonds. A diversified single-stock portfolio is more work than one ETF but remains fully available — and it’s not a PFIC either.

What not to do

Don’t “solve” PRIIPs by buying the UCITS equivalents your EU platform happily offers — for a US person those are PFICs, and the tax damage dwarfs any convenience. And don’t misstate your address or residency to any platform; that creates problems far worse than the one you’re solving.

The bottom line

The squeeze is real but navigable: most Americans in Europe run their investments through an expat-friendly US brokerage, hold US-domiciled ETFs where their broker permits, and treat the EU platform world as off-limits for funds. Sequencing this — which accounts, which broker, in what order relative to your move — is core Roadmap material, and where a portfolio genuinely needs restructuring, our vetted fee-only advisors take over.

This article is general information, not investment advice. Regulations and platform policies change — verify current rules before acting.