Investor Presentaiton
UK Law: Delegation by UK Authorized Firms to
Overseas Firms (Cont.)
Outsourcing "critical" functions
A more detailed regime requiring an outsourcing firm to take reasonable steps to avoid
undue additional operational risk and also avoid any adverse effect arising on the quality
of its internal control and the FCA's ability to monitor the firm's compliance with its
regulatory obligations
A firm must exercise due skill, care and diligence when entering into, managing, or
terminating any arrangement for the outsourcing of critical or important operational
functions or of any relevant services and activities to a delegate
A firm must ensure that the respective rights and obligations of the firm and of the
delegate are clearly allocated and set out in a written agreement
Morgan Lewis
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