The Canadian Depository for Securities Ltd. has applied to the Ontario Securities Commission for an order to vary its current recognition and designation order as a clearing agency.

The commission issued an order recognizing CDS as a clearing agency in 1997. That order contains only minimal terms and conditions requiring CDS to obtain commission non-disapproval of its rules and procedures.

It does not specifically address other key recognition criteria, including governance, fitness, access, fees and due process standards. It notes that many of these standards are already applied by the commission in its general oversight of CDS. Nevertheless, OSC staff and CDS agreed to modernize the 1997 order.

OSC staff have worked with CDS to develop a comprehensive oversight regime for CDS similar to the oversight regime for self-regulatory organizations and exchanges. The draft order will improve the transparency of the oversight regime, codify the existing regulatory practice, and incorporate other terms and conditions that reflect international standards for central securities depositories and clearing and settlement systems.

Comments are due by May 9.