Québec Implements Legislative Framework For Regulation Of Derivatives

Bill 77, the Derivatives Act, received royal assent on June 20, 2008 and will come into force on dates to be set by the Government. The Bill, which was introduced on April 9, 2008 by the Québec Minister of Finance, Monique Jérôme-Forget, establishes a broad legislative framework that specifically regulates derivatives in Québec. Québec is the first Canadian province to implement such a framework.

Whereas only certain derivatives are currently governed by the Québec Securities Act (QSA), the new Derivatives Act applies to all derivatives activities in the province. The decision to adopt legislation covering all derivatives appears to have been motivated, in part, by the presence of the Montréal Exchange – Canada's principal derivatives exchange – in Québec and the recent launch of the Montréal Climate Exchange, on which environmental futures contracts will be traded.