The Canadian securities regulatory authorities across
multiple provinces have jointly introduced a new business conduct rule. This
rule, aimed at regulating the activities of over-the-counter (OTC) derivatives
dealers and advisers, seeks to establish a framework aligned with international
standards. It aims to bolster transparency and accountability in the OTC
derivatives market.
The newly adopted rule introduces a framework that places
significant obligations on OTC derivatives dealers and advisers. These
obligations are designed to align with global best practices and include
mandates related to fair dealing, managing conflicts of interest, reporting
non-compliance, and maintaining diligent recordkeeping.
In a statement, the regulators said that this rule is
important in safeguarding the interests of the market participants by enhancing
transparency, fostering accountability, and encouraging ethical practices
within the OTC derivatives market in Canada.
The CSA’s Chair and CEO of the Alberta Securities
Commission, Stan Magidson, said: “Derivatives play a critical role in our
financial system, and these robust standards provide valuable protections to
participants in the Canadian OTC market. This key milestone could not have been
achieved without our stakeholders’ meaningful participation and commentary
during the entire consultation process.”
The final business conduct rule will become effective on
September 28, 2024. The regulators have encouraged market participants,
derivatives dealers, and advisers to familiarize themselves with the provisions
of the new rule to ensure compliance . Dubbed the Multilateral Instrument 93-101
Derivatives, the regulators said the policy can be accessed through the participating
CSA members’ websites.
Canada Streamlines Derivatives Markets
The development of this business conduct rule was a process
that spanned three stages of consultation involving public roundtables to
address regulatory, implementation, and compliance concerns.
The feedback received during the most recent consultation
phase streamlined the final rule to mitigate potential negative impacts on
derivatives market liquidity and reduce the implementation burden. The
streamlined approach enables firms to leverage their existing compliance
systems effectively.
Furthermore, the British Columbia Securities Commission has
indicated its intention to adopt similar rules. Besides that, the CSA Staff plans to convert Multilateral Instrument 93-101 into a National
Instrument, further harmonizing derivatives regulation across Canada.
The CSA, representing the securities regulators of Canada’s
provinces and territories, is working to streamline and enhance regulations in
the Canadian capital markets and to reinforce investor protection and market
integrity.
The Canadian securities regulatory authorities across
multiple provinces have jointly introduced a new business conduct rule. This
rule, aimed at regulating the activities of over-the-counter (OTC) derivatives
dealers and advisers, seeks to establish a framework aligned with international
standards. It aims to bolster transparency and accountability in the OTC
derivatives market.
The newly adopted rule introduces a framework that places
significant obligations on OTC derivatives dealers and advisers. These
obligations are designed to align with global best practices and include
mandates related to fair dealing, managing conflicts of interest, reporting
non-compliance, and maintaining diligent recordkeeping.
In a statement, the regulators said that this rule is
important in safeguarding the interests of the market participants by enhancing
transparency, fostering accountability, and encouraging ethical practices
within the OTC derivatives market in Canada.
The CSA’s Chair and CEO of the Alberta Securities
Commission, Stan Magidson, said: “Derivatives play a critical role in our
financial system, and these robust standards provide valuable protections to
participants in the Canadian OTC market. This key milestone could not have been
achieved without our stakeholders’ meaningful participation and commentary
during the entire consultation process.”
The final business conduct rule will become effective on
September 28, 2024. The regulators have encouraged market participants,
derivatives dealers, and advisers to familiarize themselves with the provisions
of the new rule to ensure compliance . Dubbed the Multilateral Instrument 93-101
Derivatives, the regulators said the policy can be accessed through the participating
CSA members’ websites.
Canada Streamlines Derivatives Markets
The development of this business conduct rule was a process
that spanned three stages of consultation involving public roundtables to
address regulatory, implementation, and compliance concerns.
The feedback received during the most recent consultation
phase streamlined the final rule to mitigate potential negative impacts on
derivatives market liquidity and reduce the implementation burden. The
streamlined approach enables firms to leverage their existing compliance
systems effectively.
Furthermore, the British Columbia Securities Commission has
indicated its intention to adopt similar rules. Besides that, the CSA Staff plans to convert Multilateral Instrument 93-101 into a National
Instrument, further harmonizing derivatives regulation across Canada.
The CSA, representing the securities regulators of Canada’s
provinces and territories, is working to streamline and enhance regulations in
the Canadian capital markets and to reinforce investor protection and market
integrity.
Comments are closed.