CPS 230 para 53 Formal legally binding agreement for each material arrangement and its minimum terms

For every material arrangement the entity must hold a formal, legally binding agreement that at least: (a) defines the services and their service levels; (b) sets each party's rights, duties and expectations, including asset ownership, data ownership and control, dispute resolution, audit access, indemnity and liability; (c) lets the entity satisfy its legal and compliance obligations; (d) obliges the provider to notify the entity when it materially relies on other material service providers through subcontracting or similar to deliver the service; (e) makes the provider responsible for any subcontractor's failure; (f) contains a force majeure clause stating which parts survive a force majeure event; and (g) gives termination rights over the whole arrangement or parts of it, and for an RSE licensee a right to terminate where continuing would breach the best financial interests duty (SIS Act s 52(2)(c)). Para 57 can exempt the arrangement (Attachment category provider on standardised terms or no formal agreement), and APRA can exempt it in writing under para 58.

Source: APRA CPS 230, CPS 230 para 53. The statement above is our statement of the clause, read from the published text and cited so you can check it against the official text, not the instrument verbatim. Open APRA CPS 230 in the compliance library.

Applies to APRA-regulated entities.