Regulatory Alerts2020-11-04
FINMA Circular 2018/3 Outsourcing
The Swiss Financial Market Supervisory Authority (FINMA) issues Circular 2018/3 to define supervisory requirements for outsourcing significant functions by banks, insurance companies, and selected financial institutions. The document mandates that institutions maintain an inventory of outsourced activities, conduct rigorous risk analyses, and ensure contractual rights for audit and supervision by both the institution and FINMA. It explicitly prohibits the outsourcing of core strategic decision-making and supreme governing body functions while allowing exceptions for captive insurance management and specific internal group arrangements.
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