Three trade repositories recognized by Canadian securities regulators

As part of the implementation of new derivatives trade reporting rules, regulators in several Canadian provinces have accepted recognition of three trade repositories

According to a July 18 news release by the CSA, securities regulators for five Canadian provinces have approval of recognition orders for three derivatives trade repositories: the Chicago Mercantile Exchange Inc., DTCC Data Repository (U.S.) LLC and ICE Trade Vault, LLC. The approving jurisdictions are Alberta, British Columbia, New Brunswick, Nova Scotia, and Saskatchewan. Regulators in Newfoundland and Labrador, Nunavut, Northwest Territories, Prince Edward Island and Yukon have yet to approve similar recognition orders for some or all of these trade repositories before trade reporting requirements are initiated in their jurisdictions.

The approval of the repositories is part of the implementation of Multilateral Instrument 96-101, (Trade Repositories and Derivatives Data Reporting). This is intended for securities regulators in provinces and territories of Canada outside of Ontario, Manitoba and Quebec, where a separate trade reporting regime already exists. All these rules have been drawn in an effort to achieve effective regulatory oversight of over-the-counter (OTC) derivatives.

Under MI 96-101, market participants are to report their trades to recognized trade repositories. The set of rules also outlines reporting obligations of derivatives market participants, in respect of transactions within the scope of Multilateral Instrument 91-101 (Derivatives: Product Determination).

MI 96-101 is very similar to the existing set of rules in Ontario, Manitoba, and Quebec, though it has some key differences. Amendments have also been separately made to both sets of reporting regulations in such a way as to make them harmonized. In the case of MI 96-101, the amendments made (which were adopted by all jurisdictions covered except British Columbia) require all local counterparties to obtain a legal entity identifier, implement an exemption for inter-affiliate derivatives, and outline requirements involving public dissemination of transaction-level data for certain OTC derivatives.

Clearing agencies and derivatives dealers covered by the rules will be required to report certain OTC derivatives starting July 29, 2016. All other reporting counterparties that are required to report OTC derivatives will have to submit their reports starting November 1, 2016.

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