Preliminary issues

Outsourcing is an arrangement under which an organisation contracts with a service provider to perform services that the organisation currently performs in-house or which are performed by an existing third party supplier. The outsourcing provider will instead provide those services using their own personnel and, often, facilities.

The outsourcing topic is divided into four subtopics, each covering a specific phase of an outsourcing transaction as follows:

  1. Preliminary issues—issues for consideration in the early stages of a transaction, from initial planning through to bidder selection (see below)

  2. Outsourcing agreements—precedents and detailed guidance on the key issues to consider when drafting and negotiating an outsourcing agreement. See Outsourcing agreements—overview

  3. Contract management in outsourcing—issues arising after the date of signature including governance, change and disputes. See Contract management in outsourcing—overview

  4. Outsourcing by type and sector—specific guidance on certain types of transaction including public sector, financial services and international. See Outsourcing by type and sector—overview

The Outsourcing transaction toolkit is a tool providing access to key content on each phase of an outsourcing transaction.

Preliminary stages

The early stages of an outsourcing transaction vary significantly

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Commission preliminarily finds TikTok breached Digital Services Act over addictive design

The European Commission has preliminarily found that TikTok breached the Digital Services Act (EU DSA) due to its addictive design, citing features such as infinite scroll, autoplay, push notifications and its highly personalised recommender system, which the Commission says fuel compulsive behaviour and weaken users’ self control, particularly among minors and vulnerable adults. It states that TikTok failed to adequately assess risks to users’ physical and mental wellbeing and disregarded indicators of compulsive use, including minors’ night time screen activity and the frequency with which users open the app. The Commission further considers that TikTok has not implemented reasonable, proportionate or effective risk mitigation measures, noting that existing screentime and parental control tools are easy to dismiss, introduce limited friction and require additional time and skills from parents. At this stage, the Commission suggests that TikTok must change the basic design of its service, such as by disabling key addictive features like infinite scroll over time, implementing effective screen time breaks and adapting its recommender system, and confirms that these findings do not prejudge the final outcome. TikTok may now exercise its right to defence by examining the investigation files and responding in writing, while the European Board for Digital Services will be consulted before any final non-compliance decision, which could lead to a fine of up to 6% of TikTok’s worldwide annual turnover.

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