1. DORA’s Primary Focus: Strengthening ICT Risk Management in the Financial Sector#

The Digital Operational Resilience Act (DORA) specifically targets the financial sector, including:

  • Banks
  • Insurance companies
  • Investment firms
  • Payment service providers
  • Crypto-asset service providers

DORA introduces strict cybersecurity standards and reporting obligations for these entities, as well as for their third-party ICT service providers. The goal is to ensure that financial institutions can withstand, respond to, and recover from cyber threats and operational disruptions.

2. Harmonization of ICT Risk Management Across the EU#

DORA aims to:

  • Standardize ICT risk management practices across the financial sector.
  • Replace fragmented national regulations with a unified EU-wide framework, reducing inconsistencies and ensuring a level playing field.
  • Align existing rules (such as those under NIS2, GDPR, and sector-specific regulations) to create a cohesive approach to cybersecurity and operational resilience.

3. Scope of DORA#

DORA applies to:

  • Financial entities: Banks, insurers, investment firms, payment institutions, and crypto-asset service providers.
  • ICT third-party service providers: Companies that provide critical digital services (e.g., cloud computing, data analytics, cybersecurity services) to financial entities.

4. Key Benefits of DORA#

  • Reduced Cybersecurity Risks: By enforcing robust ICT risk management, DORA helps financial entities identify, mitigate, and respond to cyber threats more effectively.
  • Enhanced Resilience: Financial institutions will be better prepared to maintain operations during cyber incidents or disruptions.
  • Optimized Compliance: A single, harmonized regulatory framework simplifies compliance for financial entities operating across multiple EU countries.
  • Regulatory Alignment: DORA ensures that financial sector regulations are consistent with broader EU cybersecurity policies, such as NIS2 and GDPR.

5. Core Requirements Under DORA#

  • ICT Risk Management: Financial entities must implement comprehensive risk management frameworks to address ICT-related risks.
  • Incident Reporting: Mandatory reporting of major ICT-related incidents to competent authorities within strict deadlines.
  • Digital Operational Resilience Testing: Regular penetration testing, vulnerability assessments, and scenario-based testing to evaluate resilience.
  • Third-Party Risk Management: Financial entities must assess and monitor the cybersecurity practices of their ICT service providers.
  • Information Sharing: Encourages collaboration and sharing of cyber threat intelligence among financial entities and authorities.