FCA material third-party notifications and registers: the 2027 change
From 18 March 2027, specified firms must notify the FCA when entering into a material third-party arrangement or significantly changing one, and provide an annual register of material arrangements. The final FCA policy PS26/2 and guidance FG26/4 were published on 18 March 2026. These provisions capture material non-outsourcing arrangements as well as material outsourcing, where the definitions are met.
The rules are not a universal obligation for every FCA-authorised business. They apply to particular categories; firms should verify their legal status and permissions before commencing a reporting build.
Which firms are listed by the FCA?
The FCA includes enhanced-scope SMCR firms, banks, designated investment firms, building societies, Solvency II firms, CASS large firms, UK recognised investment exchanges, authorised electronic-money institutions and authorised payment institutions, and consolidated tape providers. Other firms continue to have relevant existing outsourcing, Principle 11 and notification duties, but should not assume the new annual register is automatically theirs.
What makes an arrangement material?
Under the new regime, materiality may arise when disruption or failure could cause intolerable harm to clients, threaten relevant elements of financial-system soundness or integrity, or cast serious doubt on the firm’s ability to meet threshold conditions or important regulatory obligations. The assessment must reflect impact, not simply the supplier’s annual contract value.
Preparing a reliable register
Record the entity and supplier identity, service provided, affected important business services, materiality rationale, contractual dates, primary and sub-supplier dependencies, geography, concentration, incident channels, business owner and the record’s evidence source. Align field definitions with the FCA’s published template instead of inventing a local spreadsheet that will be difficult to convert later.
The FCA says the initial submission window is expected at the end of the implementation period and affected firms will then have 90 calendar days to submit their register. The regulator will notify firms when the window opens. That is more precise than guessing an exact first submission date today.
Governance matters more than collecting columns
A supplier register can be technically complete but operationally wrong if no one owns updates after procurement, contract renegotiation or service migration. Define who decides materiality, how changes enter the register, what evidence is retained and how compliance receives notice in time. Reconcile the inventory against purchase and vendor-management records regularly.
A focused readiness review can determine whether the firm is in scope, map current data to the official template and prioritise missing fields and processes. This does not replace legal review of materiality or reporting decisions.
A defensible material-arrangement workflow
The most important design decision is who owns the materiality assessment, not how many columns a spreadsheet contains. A proportionate workflow should establish (1) procurement or business-owner notification, (2) materiality assessment against the firm’s obligations and potential consumer/market impact, (3) approval and evidence retention, (4) register update, and (5) submission ownership and escalation if the arrangement changes.
The FCA’s published templates—not a website checklist—should determine the final reportable field structure. Reconcile material arrangements to procurement, contract and service inventories so cloud subscriptions, non-outsourcing services and newly introduced sub-suppliers are not invisible. Keep a change history because a contract amendment can alter an arrangement’s risk profile without changing its supplier name.
Timing nuance: the FCA expects to notify firms when the first register submission window opens near the end of the implementation period and to provide 90 calendar days for the submission. Do not advertise an exact first-filing deadline before that communication. Existing Principle 11 and outsourcing notification duties continue in the meantime.
Practical template to use with your team
- Download the third-party register planning fields — adapt, verify and approve before operational use.
- Download the 2027 reporting readiness checklist — adapt, verify and approve before operational use.
Frequently asked questions
Are non-outsourcing suppliers included?
Potentially. The FCA’s final regime covers material non-outsourcing as well as outsourcing arrangements where the applicable definitions are met.
Do small payment institutions automatically have the new register duty?
Not by virtue of being small payment institutions alone. The FCA explicitly lists authorised payment institutions; exact status and other applicable duties must be checked.
When is the first annual register due?
The FCA expects to open a submission window near the end of the implementation period and give in-scope firms 90 calendar days, with details communicated to them.