THE SECURITIES ACT ) Order No. 7668
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Subsection 20(1) ) October 31, 2024
Manitoba Securities Commission
COORDINATED BLANKET ORDER 96-932
Citation: Re Temporary Exemptions from Certain Derivatives Data Reporting Requirements
Definitions
1. Terms defined in The Securities Act (Manitoba) (the Act), National Instrument 14-101 Definitions and Manitoba Securities Commission Rule 91-507 Trade Repositories and Derivatives Data Reporting (the TR Rule) have the same meaning in this Order.
2. In this Order, each of the terms “affiliated entity” and “qualified reporting counterparty” has the same meaning as in the TR Amendments.
Background
3. On July 25, 2024, the Manitoba Securities Commission (the Commission) amended the TR Rule (the TR Amendments).[1] The TR Amendments come into force on July 25, 2025.
4. The TR Rule provides that a reporting counterparty is required to report creation data relating to a transaction in no event later than the end of the business day following the execution of the transaction. The TR Amendments provide that a reporting counterparty that is not a qualified reporting counterparty is required to report creation data no later than the end of the second business day following the execution of the transaction.
5. The TR Rule provides that a reporting counterparty is required to report life-cycle event data in no event later than the end of the business day following the day on which the life-cycle event occurs. The TR Amendments provide that a reporting counterparty that is not a qualified reporting counterparty is required to report life-cycle event data no later than the end of the second business day following the day on which the life-cycle event occurs.
6. The TR Rule requires a reporting counterparty that is not a derivatives dealer or recognized or exempt clearing agency to report valuation data quarterly. The TR Amendments provide that a reporting counterparty that is not a derivatives dealer or a recognized or exempt clearing agency is not required to report valuation data.
7. The TR Rule provides that a local counterparty is not required to report derivatives data for a transaction that involves a commodity derivative, other than cash or currency, if the local counterparty is not a derivatives dealer or a recognized or exempt clearing agency, and if the local counterparty has less than $500,000 aggregate notional value, without netting, under all its outstanding transactions at the time of the transaction including the additional notional value related to that transaction. The TR Amendments replace this exclusion with an exclusion that applies, subject to the terms of the TR Amendments, with reference to $250,000,000 aggregate month-end gross notional amount under all outstanding commodity derivatives.
8. The TR Rule provides that a reporting counterparty is not required to report derivatives data in relation to a transaction if, at the time the transaction is executed, the counterparties to the transaction are “affiliated companies” and neither counterparty is a derivatives dealer, recognized or exempt clearing agency, or affiliate thereof. The TR Amendments replace this exclusion with an exclusion that applies, subject to the terms of the TR Amendments, if the counterparties to the transaction are affiliated entities. The TR Amendments provide that the term “affiliated entity” includes certain partnerships, limited partnerships, and trusts, subject to the terms of the TR Amendments.
9. The Commission seeks to provide market participants with the exemptions listed below to enable them to benefit from certain intended reductions in regulatory burden under the TR Amendments without having to wait until they come into force.
Order
End-user reporting of creation data
10. Considering that it would not be prejudicial to the public interest to do so, the Commission orders under subsection 20(1) of the Act that a reporting counterparty is exempt from reporting creation data relating to a transaction within the time periods prescribed under section 31 of the TR Rule, provided that:
(a) the reporting counterparty is not a qualified reporting counterparty,
(b) the reporting counterparty reports creation data no later than the end of the second business day following the execution date of the transaction.
End-user reporting of life-cycle event data
11. Considering that it would not be prejudicial to the public interest to do so, the Commission orders under subsection 20(1) of the Act that a reporting counterparty is exempt from reporting life-cycle event data relating to a transaction within the time periods prescribed under section 32 of the TR Rule, provided that:
(a) the reporting counterparty is not a qualified reporting counterparty,
(b) the reporting counterparty reports life-cycle event data no later than the end of the second business day following the day on which the life-cycle event occurs.
End-user reporting of valuation data
12. Considering that it would not be prejudicial to the public interest to do so, the Commission orders under subsection 20(1) of the Act that a reporting counterparty that is not a derivatives dealer or a recognized or exempt clearing agency is exempt from reporting valuation data under section 33 of the TR Rule.
End-user reporting exclusion for commodity derivatives
13. Considering that it would not be prejudicial to the public interest to do so, the Commission orders under subsection 20(1) of the Act that a local counterparty is exempt from a requirement under the TR Rule to report derivatives data relating to a commodity derivative, provided that:
(a) the local counterparty is not a qualified reporting counterparty,
(b) the aggregate month-end gross notional amount under all outstanding transactions in commodity derivatives of the local counterparty, and of each affiliated entity of the local counterparty that is a local counterparty in a jurisdiction of Canada, other than under paragraph (b) of the definition of “local counterparty” as defined under Multilateral Instrument 96-101 Trade Repositories and Derivatives Data Reporting, excluding transactions with an affiliated entity, did not, in any calendar month in the preceding 12 calendar months, exceed $250 000 000,
(c) the local counterparty begins to report derivatives data 180 days after the date that the local counterparty ceases to satisfy a condition under paragraphs (a) or (b), unless during that 180-day period the local counterparty again satisfies the condition.
End-user reporting exclusion for transactions with affiliated entities
14. Considering that it would not be prejudicial to the public interest to do so, the Commission orders under subsection 20(1) of the Act that a reporting counterparty is exempt from reporting derivatives data under the TR Rule in relation to a transaction if, at the time the transaction is executed, the counterparties to the transaction are affiliated entities and neither counterparty is a qualified reporting counterparty.
Effective Date and Term
15. This Order comes into effect on October 31, 2024, and will cease to be effective on July 25, 2025, unless extended by the Commission.
BY ORDER OF THE COMMISSION:
________”Chris Besko”_________
Chris Besko
Director