The Office of the Superintendent of Financial Institutions recently published the final version of Guideline E-22 – Margin Requirements for Non-centrally Cleared Derivatives. The guideline is intended to provide clear and comprehensive guidance to all federally regulated financial institutions on the variation and initial margin requirements that will take effect from September 2016. The final version is the result of a public consultation and thus includes several revisions.
The Canadian Securities Administrators recently announced proposed changes to Multilateral Instrument 96-101 Trade Repositories and Derivatives Data Reporting and its related Companion Policy. The participating jurisdictions propose to limit the trade reporting disseminated publicly to certain asset classes and underlying benchmarks that exhibit sufficient market activity.
The Canadian Securities Administrators recently published the proposed National Instrument 94-101 Mandatory Central Counterparty Clearing of Derivatives and its companion policy, which introduce mandatory clearing of certain over-the-counter derivative transactions. It is hoped that this will mitigate counterparty risk in the derivatives market, increase financial stability and eliminate opportunities for regulatory arbitrage.
The securities regulatory authorities in Alberta, British Columbia, Saskatchewan, New Brunswick, Newfoundland and Labrador, the Northwest Territories, Nova Scotia, Nunavut, Prince Edward Island and Yukon recently adopted derivatives product determination and trade reporting rules. The rules define instruments subject to the trade repositories rule and set out derivatives data reporting requirements.
The Canadian Securities Administrators' proposed rule on customer clearing contains requirements for the treatment of customer collateral by clearing intermediaries and derivatives clearing agencies. The new rule recognises that multiple clearing intermediaries may be involved in a transaction, and that derivative clearing infrastructure and service providers are primarily located outside Canada.
What data relating to reportable derivatives transactions will be disseminated publicly in July 2016? With the publication of proposed amendments to Ontario Securities Commission Rule 91-507, Trade Repositories and Derivatives Data Reporting, the answer to this question has become clearer. Similar amendments are also proposed to the equivalents of the rule in Manitoba and Quebec.
The Office of the Superintendent of Financial Institutions recently published a draft guideline on margin requirements for non-centrally cleared derivatives for public consultation. The draft guideline is intended to provide clear and comprehensive guidance to all federally regulated financial institutions on the variation and initial margin requirements that will take effect next year. Comments on the draft guideline will be accepted until November 27 2015.
Canada and a number of Canadian provinces recently released draft legislation and regulations for the implementation of the Cooperative Capital Markets Regulatory System as part of the regime being implemented for the regulation of derivatives. Two of the proposed regulations address the regulation of derivatives and proposed amendments to National Instrument 31-103 include derivatives-related provisions.
The Ontario Securities Commission has announced its intention to review compliance with derivatives trade reporting requirements during fiscal year 2015/16. The notice setting out the review provides that the initial compliance reviews will focus on those derivatives dealers that are "most active" in the market and their compliance with the derivative data reporting requirements in Ontario Rule 91-507.
The Canadian Securities Administrators' (CSA) proposed National Instrument 94-101 – Mandatory Central Counterparty Clearing of Derivatives is set to introduce significant changes to the Canadian over-the-counter derivatives landscape, as it will require the clearing of certain derivatives. The CSA is proposing a phase-in of the clearing requirement, similar to the approach taken in the United States and the European Union.
The Office of the Superintendent of Financial Institutions recently published the final version of Guideline B-7 – Derivatives Sound Practices. The guideline actually became effective before it was published in final form in order to coincide with the timing of the provincial derivatives data reporting requirements coming into effect.
As one of the latest regulatory initiatives to fundamentally restructure derivatives trading in Canada, the Canadian Securities Administrators Derivatives Committee has published a new consultation paper containing proposals to change the way in which over-the-counter (OTC) derivatives are regulated in Canada. In particular, the consultation paper sets out the committee's regulatory proposals for OTC derivatives trading facilities.
The securities regulators in Alberta, British Columbia, New Brunswick, Nova Scotia and Saskatchewan recently published derivatives product determination and trade reporting rules. The proposed instruments are expected to have a significant impact on the business processes of derivatives market participants and firms that are not already affected by existing provincial rules.
The Financial Services Commission of Ontario has carried out a public consultation on a draft investment guidance note entitled "Prudent Investment Practices for Derivatives". The note applies to pension plans registered in Ontario and is intended to provide guidance to administrators with respect to prudent investment practices related to derivatives.
The Office of the Superintendent of Financial Institutions has released draft Guideline B-7 Derivatives Sound Practices, which applies to federally regulated financial institutions. The latest updates to the draft guideline are intended to enforce reforms for the over-the-counter derivatives market introduced by G20 leaders.
With derivatives trade reporting soon to be required in some Canadian provinces, the Ontario Securities Commission (OSC) has released a second set of amendments to OSC Rule 91-507 Trade Repositories and Derivatives Data Reporting which will, among other things, allow parties to designate a single reporting party for dealer to dealer trades and for non-dealer to non-dealer trades.
Just over four months after the entry into force of the Trade Reporting Rule, the Ontario Securities Commission has released amendments to this rule that will delay the effective date of the reporting obligations for all counterparties and remove the 'fall-back' reporting mechanism that required Ontario non-dealer counterparties to monitor the transaction reporting of a foreign dealer reporting counterparty.
The Canadian Securities Administrators' proposed model rule on customer clearing contains requirements for the treatment of customer collateral by clearing members, intermediaries and derivatives clearing agencies. It aims to ensure that customer collateral is protected, particularly in the case of financial difficulties of a clearing member or clearing intermediary.
The Canadian Securities Administrators (CSA) recently published the proposed Model Provincial Rule on Mandatory Central Clearing of Derivatives and related explanatory guidance as CSA Staff Notice 91-303. The rule is intended to improve the transparency of the derivatives market to both the regulators and the public, to enhance the overall mitigation of risks.
The Ontario Securities Commission recently published final OSC Rule 91-506 Derivatives: Product Determination and OSC Rule 91-507 Trade Repositories and Derivatives Data Reporting. These rules represent the first set of final rules issued by Canadian securities regulators addressing the regulation of over-the-counter derivatives in Canada.