Textual Amendments
F1Words in Pt. 3 heading omitted (31.12.2020) by virtue of The Electronic Money, Payment Services and Payment Systems (Amendment and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1201), reg. 1(3), Sch. 2 para. 6 (with reg. 4, Sch. 3 Pt. 1) (with further transitional provisions in Sch. 3 Pt. 1A as inserted by S.I. 2019/405, regs. 1, 10 and as amended by S.I. 2019/1010, regs. 1(3), 7; S.I. 2019/1212, regs. 1(2), 7 and S.I. 2020/56, regs. 1, 8); 2020 c. 1, Sch. 5 para. 1(1)
26.—(1) An authorised electronic money institution must notify the Authority of its intention to enter into a contract with another person under which that person will carry out any operational function relating to the issuance, distribution or redemption of electronic money or the provision of payment services (“outsourcing”).
(2) Where the institution intends to outsource any important operational function [F2, including provision of an information technology system], all of the following conditions must be met—
(a)the outsourcing is not undertaken in such a way as to impair—
(i)the quality of the institution's internal control; or
(ii)the ability of the Authority to monitor [F3and retrace] the authorised electronic money institution's compliance with these Regulations or the Payment Services Regulations [F42017];
(b)the outsourcing does not result in any delegation by the senior management of the institution of responsibility for complying with the requirements imposed by or under these Regulations or the Payment Services Regulations [F52017];
(c)the relationship and obligations of the institution towards its electronic money holders under these Regulations or the Payment Services Regulations [F62017] is not substantially altered;
(d)compliance with the conditions which the institution must observe in order to become an authorised electronic money institution and remain so is not adversely affected; and
(e)none of the conditions of the institution's authorisation requires removal or variation.
(3) For the purposes of paragraph (2), an operational function is important if a defect or failure in its performance would materially impair—
(a)compliance by the institution with these Regulations or the Payment Services Regulations [F72017] and any requirement of its authorisation under these Regulations;
(b)the financial performance of the institution; or
(c)the soundness or continuity of the institution's electronic money issuance or provision of payment services.
[F8(4) An authorised electronic money institution must notify the Authority without undue delay of any change in outsourced functions or the persons to which functions are outsourced.]
Textual Amendments
F2Words in reg. 26(2) inserted (13.8.2017 for specified purposes, 13.10.2017 for specified purposes, 13.1.2018 in so far as not already in force) by The Payment Services Regulations 2017 (S.I. 2017/752), reg. 1(2)(c)(iii)(3)(f)(i)(6), Sch. 8 para. 5(17)(a)(i) (with reg. 3)
F3Words in reg. 26(2)(a)(ii) inserted (13.8.2017 for specified purposes, 13.10.2017 for specified purposes, 13.1.2018 in so far as not already in force) by The Payment Services Regulations 2017 (S.I. 2017/752), reg. 1(2)(c)(iii)(3)(f)(i)(6), Sch. 8 para. 5(17)(a)(ii) (with reg. 3)
F4Word in reg. 26(2)(a)(ii) substituted (13.8.2017 for specified purposes, 13.10.2017 for specified purposes, 13.1.2018 in so far as not already in force) by The Payment Services Regulations 2017 (S.I. 2017/752), reg. 1(2)(c)(iii)(3)(f)(i)(6), Sch. 8 para. 5(17)(b) (with reg. 3)
F5Word in reg. 26(2)(b) substituted (13.8.2017 for specified purposes, 13.10.2017 for specified purposes, 13.1.2018 in so far as not already in force) by The Payment Services Regulations 2017 (S.I. 2017/752), reg. 1(2)(c)(iii)(3)(f)(i)(6), Sch. 8 para. 5(17)(b) (with reg. 3)
F6Word in reg. 26(2)(c) substituted (13.8.2017 for specified purposes, 13.10.2017 for specified purposes, 13.1.2018 in so far as not already in force) by The Payment Services Regulations 2017 (S.I. 2017/752), reg. 1(2)(c)(iii)(3)(f)(i)(6), Sch. 8 para. 5(17)(b) (with reg. 3)
F7Word in reg. 26(3)(a) substituted (13.8.2017 for specified purposes, 13.10.2017 for specified purposes, 13.1.2018 in so far as not already in force) by The Payment Services Regulations 2017 (S.I. 2017/752), reg. 1(2)(c)(iii)(3)(f)(i)(6), Sch. 8 para. 5(17)(b) (with reg. 3)
F8Reg. 26(4) inserted (13.8.2017 for specified purposes, 13.10.2017 for specified purposes, 13.1.2018 in so far as not already in force) by The Payment Services Regulations 2017 (S.I. 2017/752), reg. 1(2)(c)(iii)(3)(f)(i)(6), Sch. 8 para. 5(17)(c) (with reg. 3)