CDS Clearing and Depository Services Inc. will extend the transition period for its new Book-entry-only Securities Services Agreement from April 1 to July 1, the organization said Monday.

On December 4, 2008, CDS announced that a new Book-entry-only Securities Services Agreement (BEO SSA) will come into effect on April 1. “The BEO SSA and associated procedures are among the first steps CDS is taking to achieve dematerialization of securities in Canada. Eliminating the reliance on paper (certificates and cheques) wherever possible will streamline processing and reduce the associated risks and handling costs — benefiting all in the securities industry,” it says.

Since then, several issuers have already submitted the BEO SSA agreement for their new issues, CDS says. But it reports that it has also received feedback from a number of issuers who have expressed concerns with some aspects of the agreement and its associated procedures.

As a result, CDS says that it will be consulting with these issuers over the coming months to address their concerns and, as a result, will extend the transition period to July 1. Nevertheless, CDS is encouraging issuers to use the new agreement in advance of the July 1 deadline; and it says that starting on April 1, issuers will be able to submit their BEO SSAs online.

IE