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LATEST UPDATE:
SIA is working with the NYSE and SEC on further amendments to the recently proposed regulations governing outsourcing activities. To date, these conversations have been productive and helpful for SIA members. SIA expects further discussions with the regulators during the Fall of 2006.
BACKGROUND
For decades, financial services firms have retained service providers to lower costs and improve service. As a result, outsourcing has yielded enormous benefits to SIA member firms and their public customers. SIA promotes the following principles in the regulation of members' outsourcing:
- The regulations of outsourcing activities and any formal or informal guidance on outsourcing should be consistent across the SROs.
- Outsourcing is a cross-border phenomenon. Any regulations should be consistent with and not unnecessarily duplicative of other U.S. and non-U.S. regulations.
- Outsourcing arrangements vary in terms of function, purpose and scope. In order to preserve the economic efficiencies driving the proliferation of outsourcing, such arrangements should not be governed by fixed or inflexible standards.
- Any regulations should exclude longstanding activities not commonly viewed as outsourcing and which are not in need of additional regulation (e.g., independent contractor arrangements, common utility and shared services providers, and professional services firms).
- Any regulations should not prescribe specific contract provisions, which could have unintended negative consequences.
