A ICT third-party service provider designated as critical by a supervisory authority will be required to pay a fee to offset the supervision costs incurred. This regulation outlines the method for calculating this fee, to be paid in euros, and sets a minimum oversight fee at €50,000 ($53,747).

The regulation was published on 30 May and will therefore enter into force on 19 June. Below is a plain English summary of key aspects of this regulation.

Fee in the first year of designation as critical third-party

In the first year of the operation of the regime the oversight fee will be split equally among the designated vendors in accordance with a simple formula:

Oversight fee =	Overall oversight expenditure of lead overseers (divided by)
	The number of designated critical third-parties

A third-party newly designated as critical will pay this fee in its first year of falling within scope of the regime, with the possibility of the fee being pro-rated where oversight of its activities does not correspond to a full year.

Oversight fee formula

The oversight fee formula will be composed of the annual cost of oversight with the turnover used as a coefficient.

Oversight fee =

(Annual oversight cost) x (turnover coefficient)

The turnover coefficient is to be calculated as follows:

Year (n)	Year (n – 2)
Turnover coefficient =	Applicable turnover of critical third-party (divided by)
	Applicable turnovers of all critical third-parties

Annual oversight costs

The oversight fee to be levied from each critical party will be based on both the direct and indirect costs of the relevant supervisory authorities, including those incurred in connection with:

• designation;
• lead overseer appointment;
• oversight including:
  • joint examination team work;
  • independent expert advice;
• lead overseer recommendation follow-up;
• governance.

Applicable turnover calculation

The applicable turnover to be used in the oversight fee formula is to be established by calculating the revenues generated by the critical third-party from the provision of services listed in the DORA RTSs.

Audited figures specifying this turnover must be provided to the lead overseer.

Where such audited figures are not provided alternative turnover is to be used as summarized in the table below.

Audited figures provided are not limited or do not entirely include revenue	Turnover used for calculation
Derived from the provision of relevant services to financial entities	EU turnover from the provision of all relevant services irrespective of client type
Generated from the provision of relevant services in the EU	Worldwide turnover generated from the provision of all relevant services
Derived from the provision of relevant services to financial entities and generated in the EU	Worldwide turnover irrespective of client type

Critical designation opt-in

A third-party who requests to be designated as critical will have to pay a non-refundable opt-in fee of €50,000.