Economic Action Plan 2014 Act, No. 2 (S.C. 2014, c. 39)
Full Document:
Assented to 2014-12-16
361. Section 3 of the Act is replaced by the following:
Marginal note:Application
3. This Part applies in respect of clearing and settlement systems designated under subsection 4(1).
Marginal note:2007, c. 6, s. 441
362. Subsections 4(1) and (2) of the Act are replaced by the following:
Marginal note:Designation by Governor
4. (1) If the Governor of the Bank is of the opinion that a clearing and settlement system could be operated in a manner that poses a systemic risk or payments system risk and the Minister is of the opinion that it is in the public interest to do so, the Governor may designate the clearing and settlement system as a clearing and settlement system that is subject to this Part.
Marginal note:Revocation
(2) If the Governor of the Bank is of the opinion that the designated clearing and settlement system could no longer be operated in a manner that poses a systemic risk or payments system risk and the Minister is of the opinion that it is in the public interest to do so, the Governor may revoke the designation.
363. Section 5 of the Act and the heading before it are replaced by the following:
Information
Marginal note:Information to be provided to Bank
5. A clearing house shall, in respect of the designated clearing and settlement system, provide the Bank with any information that the Bank may request in writing, at any time and in any form and manner that is specified by the Bank.
364. Section 6 of the Act is replaced by the following:
Marginal note:Directive to clearing house
6. (1) The Governor of the Bank may issue a directive in writing to a clearing house of a designated clearing and settlement system that requires the clearing house, within any period that may be specified in the directive, to take — and to have the participants take — any corrective measures that the Governor considers necessary, if the Governor is of the opinion that systemic risk or payments system risk is being or is likely to be inadequately controlled because of
(a) the operation of the clearing and settlement system; or
(b) any actual or anticipated acts or omissions of the clearing house or of a participant.
Marginal note:Directive to participants
(2) The Governor of the Bank may issue a directive in writing to a participant that requires the participant, within any period that may be specified in the directive, to take any corrective measures that the Governor considers necessary if the Governor has formed an opinion referred to in subsection (1) that systemic risk or payments system risk is being inadequately controlled and
(a) the clearing house fails to comply with a directive that has been issued to it under subsection (1);
(b) the designated clearing and settlement system does not have a clearing house located in Canada; or
(c) in the opinion of the Governor,
(i) the risk is being inadequately controlled because of an act or omission by a participant, and
(ii) the act or omission is not subject to the by-laws, agreements, rules, procedures, guides or other documentation governing the designated clearing and settlement system.
Marginal note:Clarification
(3) For greater certainty, a directive issued under this section must not be made in respect of
(a) the capital adequacy of a participant;
(b) the management of a participant’s investments;
(c) a participant’s corporate governance;
(d) a participant’s relations with customers who are not themselves participants in the designated clearing and settlement system;
(e) a participant’s ownership structure; or
(f) any other matter that is not directly related to a participant’s participation in the designated clearing and settlement system.
Marginal note:Directive may apply to statutory system
(4) Subject to the approval of the Minister, a directive, if it so provides, applies to a designated clearing and settlement system that is established under a statute.
365. The heading before section 9 of the Act is replaced by the following:
Notice of Changes
366. Subsection 9(3) of the Act is repealed.
367. Section 11 of the Act and the heading before it are repealed.
368. Section 12 of the Act is replaced by the following:
Marginal note:Other powers
12. The Bank may do all or any of the following:
(a) be a participant in a clearing and settlement system and participate in its loss-sharing mechanism;
(b) act as a custodian of financial assets or act as a settlement agent, or both, for a clearing house;
(c) despite section 23 of the Bank of Canada Act, accept and pay interest on deposits from a clearing house, participant or central counter-party.
Marginal note:Bank may impose fees
12.1 (1) The Bank may annually impose a fee on a clearing house for the reasonable costs to the Bank of the administration of this Act for that year in respect of the clearing house’s designated clearing and settlement system.
Marginal note:Recovery of fees
(2) A fee imposed under subsection (1) constitutes a debt due to the Bank and may be recovered as such in any court of competent jurisdiction.
369. The Act is amended by adding the following after section 13.1:
Agreements
Marginal note:Clearing house or participant
13.2 The Bank may enter into an agreement with a clearing house or a participant, or both, in respect of
(a) netting arrangements;
(b) risk-sharing and risk-control mechanisms;
(c) certainty of settlement and finality of payment;
(d) the nature of financial arrangements among participants;
(e) the operational systems and financial soundness of the clearing house; and
(f) any other matters pertaining to systemic risk or payments system risk.
Marginal note:Cooperation
13.3 The Bank may enter into an agreement or arrangement with any government authority or regulatory body for the purpose of consulting, sharing information and coordinating their actions with respect to clearing and settlement systems.
370. (1) The portion of subsection 14(3) of the Act before paragraph (a) is replaced by the following:
Marginal note:Risk information
(3) Every clearing house shall provide the Bank with any information and documents that the Bank may require to enable the Bank to determine whether the clearing and settlement system poses a systemic risk or payments system risk, including
(2) Paragraph 14(3)(d) of the Act is replaced by the following:
(d) copies of its reports, statements or other documents that are required to be filed with any government authority or regulatory body; and
Marginal note:2012, c. 5. s. 214
371. Section 15 of the Act is replaced by the following:
Marginal note:Compliance orders
15. (1) The Bank or the Governor of the Bank may apply to a superior court for an order
(a) directing a clearing house or participant to comply with this Act, a directive issued under this Act or an agreement that it has entered into under section 13.2, if the clearing house or participant has failed to comply with this Act, the directive or the agreement, as the case may be;
(b) directing a person to comply with a request made under subsection 14(1), if the person has failed to comply with the request; or
(c) directing a person to comply with a prohibition or to respect a condition imposed under this Act, if the person has failed to comply with the prohibition or to respect the condition.
Marginal note:Powers of the court
(2) The court may make any order referred to in subsection (1) and may also make any further order that it considers appropriate.
372. (1) Subsection 18(1) of the English version of the Act is replaced by the following:
Marginal note:Information confidential
18. (1) Information obtained under this Act is confidential and shall be treated accordingly.
Marginal note:2012, c. 5. s. 215(1)
(2) Subsection 18(2) of the Act is replaced by the following:
Marginal note:Disclosure permitted
(2) Nothing in subsection (1) prevents the Bank from disclosing any information, if the Bank is satisfied that the information will be treated as confidential by the authority, body or person to which it is disclosed,
(a) to any government authority or regulatory body charged with the regulation of
(i) financial institutions, as defined in section 2 of the Trust and Loan Companies Act, for purposes related to that regulation, or
(ii) entities that provide clearing or settlement services in connection with securities transactions or eligible financial contracts, for purposes related to that regulation; and
(b) to the Deputy Minister of Finance or any officer of the Department of Finance authorized in writing by the Deputy Minister of Finance or to the Chairperson of the Canada Deposit Insurance Corporation or any officer of that Corporation authorized in writing by the Chairperson.
Marginal note:2012, c. 5, s. 215(2)
(3) Subsection 18(3) of the Act is replaced by the following:
Marginal note:Disclosure permitted
(3) Nothing in subsection (1) prevents the Bank from disclosing any information regarding a clearing and settlement system that the Bank has designated under subsection 4(1) to any government authority or regulatory body charged with the regulation of systems or arrangements for the clearing or settlement of payment obligations or payment messages, for purposes related to that regulation, if the Bank is satisfied that the information will be treated as confidential by the authority or body to which it is disclosed.
Marginal note:Disclosure outside Canada
(4) Before the Bank discloses information to a government authority or regulatory body outside Canada, the Bank shall enter into an arrangement or agreement with the authority or body regarding the terms of the disclosure.
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