We present a novel approach to the engineering of regulatory mechanisms for autonomic systems. Inspired by Stafford Beer's Viable System Model (VSM) a regulatory mechanism is proposed that employs template matching technology and policy-based concepts, laying the foundations for autonomic behaviour in distributed systems. The scope of this paper is limited to subsystem 1 and 2 of the VSM, detailing the communication flows, necessary architectural building blocks, tools, and languages of the approach. The proposed mechanism is exemplified using an application from the network management domain: by controlling measurement and QoS functionality we show how to tackle the problem of managing service level quality using continuous regulation in a service provider’s core network.