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Blanket Orders Exempting Certain Counterparties from the Requirement to Submit a Mandatory Clearable Derivative for Clearing |
July 6, 2017
Introduction
The Canadian Securities Administrators (CSA or we) are of the view that amendments to National Instrument 94-101 Mandatory Central Counterparty Clearing of Derivatives (the National Instrument) may be necessary to clarify the scope of market participants that are subject to the requirement to clear an OTC derivative prescribed in Appendix A to the National Instrument (a mandatory clearable derivative).
The National Instrument was published on January 19, 2017, and came into force on April 4, 2017 (with the exception of Saskatchewan where it came into force on April 5, 2017). On such date, the clearing requirement came into force for certain counterparties that are participants of a regulated clearing agency, and is set to come into force for certain other counterparties on October 4, 2017. The anticipated clarification relates to those counterparties for which the clearing requirement would come into force on October 4, 2017.
Substance and Purpose
We anticipate publishing for comments proposed amendments to clarify the scope of the counterparties subject to the National Instrument. To facilitate the rule-making process relating to the proposed amendments, we have determined to exempt, on a temporary basis, from the clearing requirement under the National Instrument those counterparties that would be subject to the October 4, 2017 effective date.
CSA members, except the Ontario Securities Commission (the OSC), are issuing parallel orders of general application, effective October 4, 2017. The orders exempt certain counterparties, on a temporay basis, from the clearing requirement under the National Instrument. The effect of the orders is to extend the effective date of the clearing requirement from October 4, 2017 to August 20, 2018 for those certain counterparties. The orders of general application do not exempt a counterpary that is already subject to the clearing requirement because it is a participant of a regulated clearing agency that offers clearing services in respect of a mandatory clearable derivative and subscribes to clearing services for the class of derivatives to which a mandatory clearable derivative belongs.
The OSC is publishing an amendment to the National Instrument today in final form that would, subject to Ministerial approval, extend the effective date until August 20, 2018 for the same counterparties as in the orders of general application.
The orders of general application are available on the websites of the following CSA members :
www.lautorite.qc.ca
www.albertasecurities.com
www.bcsc.bc.ca
www.msc.gov.mb.ca
www.fcaa.gov.sk.ca
Questions
If you have questions about this Notice or the orders, please contact any of the following:
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Lise Estelle Brault Co-Chair, CSA Derivatives Committee Senior Director, Derivatives Oversight Autorité des marchés financiers 514-395-0337, ext. 4481 lise-estelle.brault@lautorite.qc.ca
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Kevin Fine Co-Chair, CSA Derivatives Committee Director, Derivatives Branch Ontario Securities Commission 416 593-8109 |
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Paula White Deputy Director, Compliance and Oversight Manitoba Securities Commission 204-945-5195
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Abel Lazarus Senior Securities Analyst Nova Scotia Securities Commission 902-424-6859 |
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Michael Brady Manager, Derivatives British Columbia Securities Commission 604-899-6561
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Martin McGregor Legal Counsel, Corporate Finance Alberta Securities Commission 403-355-2804 |
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Wendy Morgan Senior Legal Counsel Financial and Consumer Services Commission (New Brunswick) 506-643-7202 |
Sonne Udemgba Deputy Director Legal Department, Securities Division Financial and Consumer Affairs Authority of Saskatchewan 306-787-5879 |