BaFin Publishes Guidance on Outsourcing to Cloud Service Providers
BaFin published guidance on outsourcing to cloud service providers. This guidance, which represents a joint assessment by BaFin and the Deutsche Bundesbank, is addressed to credit institutions, financial services institutions, insurance undertakings, pension funds, investment services enterprises, capital management companies, payment institutions, and e-money institutions. The guidance does not establish any new requirements but instead reflects the current supervisory practice in outsourcing cases.
The guidance pursues the objective of creating, for the supervised entities, an awareness of the issues involved in dealing with cloud services and the related requirements of supervisory law. It draws attention to various aspects that the supervised entities should take into account when outsourcing to cloud service providers, for example, in the context of risk analysis and contractual terms. Over the past months, BaFin and Bundesbank have been in discussions with cloud service providers as well as with the supervised entities about plans for outsourcing to cloud service providers. Furthermore, at the EIOPA and the EBA levels, within the Single Supervisory Mechanism, as well as bilaterally between the national supervisory authorities, a constant exchange about how to deal with outsourcing to cloud service providers has emerged.
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Keywords: Europe, Germany, Banking, Insurance, Securities, Cloud Outsourcing, Guidance, Cloud Computing, Operational Risk, Bundesbank, BaFin
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