Released on June 9 by the Canadian Securities Administrators (CSA), the proposal to amend the over-the-counter derivatives data reporting standards aims to streamline and harmonize derivatives data reporting standards as well as improve the consistency and quality of the data available to regulators and the public.
Taking the example of the Ontario Securities Commission (OSC), comments should be provided on the following:
Proposed amendments to OSC Rule 91-507 Trade Repositories and Derivatives Data Reporting
Proposed changes to OSC Companion Policy 91-507CP to the Trade Reporting Rule
Proposed changes to OSC Companion Policy 91-506 CP to OSC Rule 91-506 Derivatives: Product Determination
Highlight of the key changes
With regards to the proposed trade reporting amendments to harmonize data fields:
A new hierarchy to determine which entity is responsible for generating the Unique Transaction Identifier (UTI) for a transaction
Requirements for a reporting counterparty to identify a transaction through a Unique Product Identifier (UPI) assigned by the Derivatives Service Bureau
Creation of a new OSC Derivatives Data Technical Manual to inform market participants on how to consistently report in accordance with the Trade Reporting Rule
Amendments to the interpretation of “affiliated entity” in accordance with the definition under proposed National Instrument 93-101 Derivatives: Business Conduct
Amendments to the definition of “derivatives dealer” to take into account any other person or company required to be registered as a derivatives dealer under securities legislation
Introduction of the concept of ‘validation of data’ to ensure, among other things, that the required data elements as set out in the Trade Reporting Rule have been reported and used the standardized formats and values set out in the OSC Derivatives Data Technical Manual
Verification of data accuracy
Maintenance and renewal of legal entity identifiers
Introduction of the concept of position level data to reduce regulatory burden through the reporting of aggregate position level data in certain circumstances
Proposal to include individuals who are residents of Ontario in the definition of “local counterparty”
The proposed changes were drafted in line with North American and global standards developed by the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO).
The proposals can be found on each CSA’s members website including the Autorité des Marchés Financiers.
Comments are to be provided in writing by October 7, 2022.