PensionsEurope has urged the European Commission to clarify the legal definition of ICT services under the Digital Operational Resilience Act (DORA) and whether it includes regulated financial services.

When establishing a definition for the act, which aims to create a single regulatory framework for managing risks that arise from ICT services, PensionsEurope has requested that the commission acknowledges that regulated financial services do not fall within its definition.

The group said that since regulated financial services are provided by financial entities, which are already subject to DORA compliance and supervision, imposing additional controls on these services entities would be redundant.

Instead, it would create unnecessary regulatory burdens, which contradict the commission’s goals outlined in the Political Guidelines 2024-2029 to reduce administrative burdens and simplify implementation by having less “red tape” and reporting, more trust and better enforcement.

Therefore, a definition of ICT services that excludes regulated financial services would help streamline legislation and eliminate overlaps and contradictions while upholding high standards, according to PensionsEurope.

It added that potential contradictions in DORA may arise if both a financial entity and an outsourced service fall under the act’s scope because it grants financial entities step-in rights when changes are made to ICT service provision.

However, when the service is classified as both a regulated financial service and an ICT-service, the service provider retains independent and equivalent decision-making authority as a financial entity under DORA.

This contradiction could lead to practical challenges if the financial entity and its service provider disagree on service delivery, potentially harming operational continuity.

PensionsEurope has requested that this definition be included in the FAQ instrument, which it deemed appropriate for this purpose, particularly given that DORA is due to come into effect in January 2025.

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