Prudent Policy: Circular on Sound Management Practices Regarding Business Continuity of Financial Institutions

Congresstraat 12-14 | 1000 Brussels
+32 2 220 53 42 | f +32 2 220 54 93 | www.cbfa.be Prudent Policy

Brussels, 10 March 2005
Circular on sound management practices regarding business continuity of financial institutions PPB 2005/2

1. Justification and definitions
   Credit institutions, insurance undertakings, investment firms1 and management companies of collective investment schemes must have an organization appropriate to their activity.2 This authorization requirement includes, among other things, that the undertakings concerned use all reasonable means to ensure their service provision and activities without interruptions. They must, in particular – taking into account the nature, size and complexity of their business – set up their organization, systems and procedures such that, in the event of a serious and unplanned interruption of their business, they can continue to comply with their obligations arising from the supervisory status and protect the interests and rights of their clients. An adapted business continuity policy is a necessary instrument in this regard to achieve these objectives. It is evident that the theme of business continuity is also on the agenda of international consultation forums and regulators, which may lead to harmonized rules in the future. This does not prevent Belgian financial institutions from already working on their business continuity policy and taking measures to complete or improve their organization in this regard. This circular lists a number of criteria – translated as sound management practices – by which the CBFA will assess the business continuity policy of the financial institutions under its supervision.