Outsourcing notification: costs drivers
Outsourcing notification tells the supervisor that a critical or important function has moved to an external provider. Filing it correctly, on time, with the right documents starts a review clock the firm does not control. The main cost driver is scope — how many providers, functions and jurisdictions the notice covers — not legal complexity.
What changes once the notice is filed
Once the notice reaches the supervisor, the firm cannot treat the outsourcing as settled. The supervisor may ask questions, request additional documents, or object outright. Until the review period runs out — or the supervisor confirms no objection — the arrangement stays provisional. Moving live traffic to the provider before that point is a decision, not a formality. It shifts risk onto the firm, regardless of how the contract with the provider reads.
This is why the notice is rarely a one-page form in practice. It carries the file that lets the supervisor decide quickly, and a thin file invites follow-up questions that extend the timeline far more than a thorough one would have.
What to do
- Compliance officer maps every function moving to the provider before drafting anything.
- Legal team confirms which of those functions qualify as critical or important under the firm's own risk classification.
- Compliance officer drafts the notice using the supervisor's current template, not a template from a previous filing.
- Firm attaches the outsourcing agreement, a risk assessment, and the provider's due-diligence file.
- Authorised signatory files the notice through the supervisor's designated channel and keeps the filing receipt.
- Compliance officer tracks the review period from the date of receipt, not the date of sending.
Who decides
The authority supervising the firm's licence reviews the notice. It does not approve outsourcing the way it approves a licence application. It either raises no objection, asks for more information, or objects within its own procedural window. Internally, the decision to file rests with whoever signs on the firm's behalf — typically a compliance officer or a board member with delegated authority. The supervisor's response, once issued, goes back to that same signatory, not to the provider.
Cost drivers
| Driver | Effect on cost and time |
|---|---|
| Number of providers | Each provider needs its own risk file and its own line in the notice |
| Number of functions moved | A notice covering several functions takes longer to prepare and to review than one covering a single function |
| Cross-border scope | A provider based outside the firm's home jurisdiction can trigger an additional local assessment |
| Sub-outsourcing by the provider | Every further layer of sub-outsourcing needs its own documentation trail |
| Data processed by the provider | Personal data processing adds a parallel assessment that runs alongside the notice, not instead of it |
| Prior objections on the same provider | A provider already flagged in an earlier notice slows down the current one |
Where the outsourced function includes automated decision-making on client data, the firm should also review Automated decision data protection how it is proved explained before filing. The supervisor may ask how that process is evidenced, and it is faster to have the answer ready than to produce it under a follow-up request.
Common forks
If the provider is based outside the firm's home region, treat the cross-border assessment as a precondition to filing, not a step to be handled afterwards. If the same provider already services another regulated activity of the firm, the notice should reference the earlier filing rather than rebuild the file from scratch.
If the arrangement touches tokenised rights recorded off-chain, check When an off-chain agreement contradicts metadata before signing. A metadata conflict there can change what the notice needs to disclose about the arrangement.
If a dispute with the provider surfaces late in the process, the filing clock and the dispute clock run independently — structurally close to how the filing clock and dispute track behave in Invalidity and revocation step by step, where an open dispute does not pause the procedural deadline.
What this page does not cover
This page explains the mechanics of outsourcing notification: who files, what happens after filing, and what drives cost and time. It does not calculate a fee, does not draft the notice, and does not decide whether a specific function is critical or important — that classification depends on facts internal to the firm. It also does not cover licence applications or ownership changes at the firm, which follow separate procedures.
Verified
This page describes the procedural mechanics of outsourcing notification as generally applied within the region's supervisory framework. It does not cite specific statutory provisions, because confirmed national implementing detail for this exact procedure is not yet held in our source register. The description is reviewed as part of the current publication cycle for this section of the site.
Related publications
For a related authorisation-and-supervision filing, see Change of control approval step by step. Both filings start a supervisor-controlled clock, though the triggers and the review windows differ.
FAQ
How long does outsourcing notification take in practice?
The review period is set by the supervisor and starts from the date of receipt, not the date of sending. Expect the process to take longer where the file covers multiple providers or functions, and shorter where the notice is narrow and complete on first submission.
Which documents are needed to start?
At minimum: the outsourcing agreement, a risk assessment of the function moved, and evidence of due diligence on the provider. Supervisors may ask for the provider's business continuity plan or its sub-outsourcing chain if the file raises questions.
What happens if the other side does not respond?
If the provider stops responding during due diligence, that silence is itself a risk factor and should be documented before the notice is filed, not brushed aside. If the supervisor stays silent within its review window, that is not the same as an explicit objection — confirm the window's end date with the supervisor's registry rather than assume approval by default.
Start a file
Outsourcing notices sit next to other filings that also depend on facts specific to the arrangement. If the underlying work involves a freelance contributor rather than a corporate provider, start from When freelancers signed nothing before treating the arrangement as a standard outsourcing case. For direct help with an outsourcing notice, our team responds to new enquiries within minutes during business hours and confirms scope the same working day — contact us to start the file.