ICT Contract meaning

Lalone cautions that DORA’s reach remains unclear for UK alternative investment fund managers with EU clients, including hedge funds, private equity, and real estate investment funds. He highlights the growing challenges in DORA-linked contract negotiations between financial entities and their service providers. With regulators able to impose unlimited fines when EU businesses err, the financial and reputational exposure is significant. What is DORA? DORA obliges financial entities to put in place a governance and risk management framework to withstand disruptions to digital and data services arising from third parties, such as cyberattacks. Accordingly, entities must ensure contracts with information and communication technology (ICT) providers satisfy defined standards. In scope entities include investment firms Trading venues such as exchanges Fund managers Cryptoasset service companies Formally, DORA applies only to EU financial entities. However, group-wide systems and controls can ‘bleed through’ borders and influence non‑EU firms. Where a large financial group maintains an internal IT or operational risk management framework at...

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Background Debate has persisted over the scope of the definition of ‘ICT services’ under DORA, continuing into the final push towards the 17 January 2025 implementation date, across the sector as a whole. As a consequence, financial entities encountered genuine, day‑to‑day challenges as they sought to have their ‘DORA contracts’ finalised in time for that implementation date, and to do so on schedule. In practice, many felt obliged either to take an expansive reading of the definition or, alternatively, to adopt a ‘wait and see’ stance, while nevertheless taking key preparatory steps to manage ICT risk arising from the relationship in the absence of a full ‘DORA contract’. In October 2024, industry stakeholders called on the European Supervisory Authorities to issue formal guidance on the scope of the definition, as referenced in our earlier client insight. Subsequently, in January 2025, those stakeholders also urged the European Commission to provide comparable clarification on the same point. Clarification on the definition of ‘ICT services’ The European Commission has affirmed...

Project documents This Practice Note offers an overview of several widely used agreements and papers in a PFI/PF2 scheme, though the precise suite adopted will turn on the particular project. In the 2018 Budget (delivered on 29 October 2018), the government stated that PF2 will not be used for new schemes (see News Analysis: Budget 2018—what does it mean for infrastructure and housebuilding?). That said, existing PFI and PF2 arrangements will remain in operation and, given the usual term of such projects, are expected to continue for many years... Project Agreement This is the core contract in any PFI arrangement. It records the full set of terms and conditions governing the relationship between the Authority and Project Co/SPV for the life of the project. Where Project Co/SPV is granted a concession (ie the exclusive right to supply/operate/exploit something to create third party revenue), the Project Agreement may be described as a concession agreement. Typically a substantial document, it is often divided into multiple sections for manageability. Under...

This Practice Note explores the principal parties commonly engaged in a PFI or PF2 project. It outlines the functions of public sector participants, private sector counterparts, finance providers and sub-contractors, together with support providers and other professionals involved. In the 2018 Budget (delivered on 29 October 2018), the government confirmed it would cease using PF2 for new schemes (see News Analysis: Budget 2018—what does it mean for infrastructure and housebuilding?). Nonetheless, live PFI and PF2 arrangements remain in operation and, given the usual duration and lifespan of these schemes, are expected to do so for many years to come. Public Sector Authority/Trust This is the public sector organisation that originates and procures the PFI scheme in question and seeks to have the asset constructed and properly maintained (the label 'Trust' applies only to NHS schemes). The public body will typically be a local authority (including fire and rescue and (formerly) police authorities), an NHS Trust or a government department or non-departmental public body. The Authority/Trust enters into a...

Abandon Describes a situation where the contractor halts performing the works for an extended, uninterrupted span of days (eg 20 business days) or for a greater aggregate of non-consecutive days (eg 60 business days) across the project’s duration or within a stated timeframe (eg 12 months), doing so wilfully and without justification at any stage of delivery or execution. Abandonment is ordinarily treated as a contractor default, enabling the Authority to terminate the Project Agreement and/or permitting Project Co to end the construction contract immediately for cause. Acceptance Tests Tests carried out to confirm whether the facility (or another project asset) achieves the standards required for the Authority to deem facility complete and accept it. Access Protocol The protocol that Project Co must follow in order to obtain access to the buildings forming part of the project at any time during the term. For instance, on a social housing scheme or a school, prerequisites would have to be satisfied by Project Co before...