The European Banking Authority (EBA) has published a consultation paper on draft outsourcing guidelines, which will replace the current guidelines issued by the Committee of European Banking Supervisors (CEBS) in 2006. The EBA Recommendations on outsourcing to cloud service providers, published in December 2017, have been incorporated into the draft guidelines and will be repealed when the new guidelines enter into force.
A public hearing will be held at the EBA offices on 4 September 2018. The consultation closes on 24 September 2018.
The revision of the 2006 CEBS Guidelines was needed because the scope and nature of outsourcing arrangements have changed over time. Outsourcing of IT processes and infrastructures, in particular, have become more common. If no additional safeguards are implemented, the concentration of IT services into a limited number of service providers could jeopardise the stability of the financial markets. Moreover, the CEBS guidelines covered credit institutions only, whereas the new draft guidelines aim to provide a more harmonised framework for all financial undertakings in the EBA’s regulatory perimeter and therefore include investment firms subject to CRD IV, payment institutions and electronic money institutions (the EBA refers to these four undertakings together as ‘institutions and payment institutions’).
Key areas addressed in the EBA’s draft guidelines:
For the press release and consultation paper, please click here.
The Dutch Central Bank (DNB) and the European Central Bank (ECB) have also recently given attention to outsourcing:
We expect outsourcing to remain a hot topic from both a business and a regulatory perspective.
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