The Central Bank has published its final Cross-Industry Guidance on Outsourcing, following its February 2021 Consultation (CP138). It has also published a Feedback Statement on that consultation.
The Guidance comes into effect immediately, but the Central Bank's "supervisory approach to its implementation will be mindful of the adjustments to be made by firms relative to the nature, scale and complexity of the use of outsourcing as an element of their business model."
Templates for the notification of planned critical or important outsourcing arrangements, or material changes to existing arrangements, will be published by the Central Bank on its website in Q1 2022 (save for the template for banks, which will instead be published via the Single Supervisory Mechanism (SSM)).
Regarding outsourcing registers, the Central Bank will require all firms with a PRISM impact rating of medium-low or above (or equivalent) to submit those registers annually, using a new online return. The first submission is expected to be required in Q2 2022 but the Central Bank will provide further details to in-scope firms in advance of the relevant date. An exception has been made for banks that are classified as 'significant' for SSM purposes - they will instead submit their registers to ECB Banking Supervision. Low-impact firms may be asked to submit their registers to the Central Bank on a case-by-case basis.
We will be publishing further analysis on the final Guidance shortly. In the meantime, links to the series of briefings published by our Financial Regulation and Technology and Innovation Groups earlier this year on key aspects of the Central Bank's consultation on the Guidance are here:
Outsourcing: Central Bank consults on draft cross-industry guidance for regulated firms
This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.
