Existing Canadian Trade Reporting Rules Add EU To Substituted Compliance Provision

The securities regulators in Ontario, Manitoba and Quebec recently released changes to their respective rules regulating trade repositories and derivatives data reporting to extend their substituted compliance provisions to reporting counterparties that report pursuant to European Union derivatives reporting rules.

As you may recall, the substituted compliance provisions effectively exempt certain entities from data reporting requirements under the Canadian rules where they comply with the equivalent trade reporting laws of certain specified foreign jurisdictions. The European Union derivatives reporting rules now join the reporting rules of the CFTC as "equivalent reporting obligations" for the purposes of the exemption. Under these "limited" substituted compliance provisions, the exemption is only available where local counterparty is a registered derivatives dealer or a guaranteed affiliate of a local counterparty.