A Look At Proposed Rules For Mandatory Clearing Of Derivatives

As we discussed in December, the CSA recently released proposed model rules on mandatory central counterparty clearing of derivatives. The proposed model rule is in two parts. The first relates to mandatory central counterparty clearing, including proposed end-user and intra-group exemptions. The second relates to determining the types of derivatives subject to mandatory clearing. The CSA has stated that "to the greatest extent appropriate" the determination process will be coordinated between the local provincial regulators to be consistent across Canada and will be consistent with international standards.

There is, as yet, no indication of the transactions that will be subject to mandatory clearing. These will eventually be listed in Appendices A and B of the rule.