On 12 November 2024, the Bank of England (BoE), Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA) published a joint policy statement on operational resilience and critical third parties (CTPs) in the UK financial services sector. The policy statement includes the final requirements and expectations for CTPs in the financial sector, as established by the regulators.
On 12 November 2024, the BoE, PRA and FCA published a joint policy statement on operational resilience and CTPs in the UK financial services sector (PRA PS16/24, FCA PS24/16).
PS16/24 outlines the final requirements and expectations for CTPs in the financial sector, as established by the BoE, the PRA, and the FCA. This follows a consultation period that ended in December 2023. The new oversight regime aims to mitigate risks to the UK's financial stability and confidence that could occur from failures or disruptions in the services provided by CTPs to financial firms, service providers, or financial market infrastructures.
The rules for CTPs will be effective from 1 January 2025, but will only apply when a designation order by HM Treasury is in force. Some rules will have a transitional period, the details of which are specified in Chapter 2 of PS16/24. While the regulators can recommend which third parties HM Treasury should designate as CTPs, the final decision rests with HM Treasury, which has not yet designated any CTPs.
Click here to read our top tips on five key things to know on the regime.
If you would like to discuss anything raised in this article, feel free to contact our Financial Regulation team.
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