The Ontario Securities Commission (OSC) on Thursday published proposed amendments to the derivatives trade reporting regime that aim to reduce the compliance burden for certain market players.
Among other things, the proposed amendments to the trade repositories rule, which are out for a 90-day comment period, set out the requirements for public dissemination of transaction-level data, which is to begin on July 29, 2016.
The amendments also indicate that public reporting will be subject to delays and other measures designed to ensure the anonymity of the firms involved in particular trades, in order to limit the possible market impact of public reporting.
The OSC is proposing to limit public disclosure of transaction-level reports to OTC derivatives that are related to certain asset classes and underlying benchmarks, “to effectively protect counterparties and maintain fairness in the market,” the OSC says in its notice and request for comments.
In addition, measures to maintain anonymity, such as the rounding and capping of notional amounts, are being proposed to protect the identity of traders.
The OSC intends to amend the data that must be publicly reported in the future, “after additional study of trade repository data and public consultation to determine the additional data and product types that are appropriate for public dissemination,” the notice says.
In particular, the OSC is interested in “the type of post-trade information that can be publicly disseminated for OTC derivative transactions with illiquid underlying assets or that appear infrequently in the Canadian OTC derivatives market,” the notice says.
The proposals also: clarify certain provisions of the trade reporting rule; ease reporting obligations for companies engaging in derivatives trades with affiliates; and introduce the requirement for firms to obtain a legal entity identifier (LEI) in a bid to help standardize reporting.
“These amendments would increase transparency and efficiency in the over-the-counter derivatives market while aiming to preserve the anonymity of counterparties,” says Kevin Fine, director of the OSC’s derivatives branch, in a statement.
Regulators in Quebec and Manitoba are publishing similar amendments today, the OSC says.
The commission’s proposals are out for comment until Feb. 3, 2016.