On 22 June 2018. the European Banking Authority (EBA) launched a new consultation paper on its Draft Guidelines on outsourcing, which puts forward a more granular and harmonised set of requirements for the outsourcing arrangements of those financial institutions that fall within the regulator’s remit. While not set to affect AIFMs and UCITS managers directly, the sentiments expressed in the final cut of these Guidelines are likely to find expression in forthcoming revisions to more directly applicable measures in the asset management space, hence their importance.

Much of the language used in the Draft Guidelines – particularly regarding how outsourcing to third countries must not lead to a situation where an institution becomes a so-called ‘empty shell' – may well be familiar. For reference, once complete the Guidelines will replace the 2006 CEBS Guidelines on outsourcing while the contents of the recommendation on outsourcing to cloud service providers – published in December 2017 – have been integrated into the current EBA exercise also.

The consultation itself runs until 24 September, while the EBA will also be hosting a Public Hearing on the Draft Guidelines at its Canary Wharf premises between 10am and 12pm on 4 September (the registration link can be found here).

Members interested in submitting a response can contact Simon Burns.