Payment Clearing and Settlement Regulations (SOR/2019-257)

Marginal note:Definitions

• 1 (1) The following definitions apply in these Regulations.

  Act

  Act means the Payment Clearing and Settlement Act. (Loi)

  affiliate

  affiliate means an affiliated person or entity within the meaning of subsection (2). (groupe)

• Marginal note:Affiliated persons or entities

  (2) For the purpose of these Regulations,

  • (a) one person or entity is affiliated with another person or entity if one of them is the subsidiary of the other or both are subsidiaries of the same person or entity or each of them is controlled by the same person or entity; and

  • (b) if two persons or entities are affiliated with the same person or entity at the same time, they are deemed to be affiliated with each other.

• Marginal note:Control

  (3) For the purpose of these Regulations,

  • (a) a person or entity controls a corporation if shares of the corporation to which are attached more than 50% of the votes that may be cast to elect directors of the corporation are held, directly or indirectly, by the person or entity and the votes attached to those shares are sufficient, if exercised, to elect a majority of the directors of the corporation;

  • (b) a person or entity controls a trust, fund or partnership (other than a limited partnership) or an unincorporated association or organization, if more than 50% of the ownership interests, however designated, into which the trust, fund, partnership, association or organization is divided are held, directly or indirectly, by the person or entity and the person or entity is able to direct the business and affairs of the trust, fund, partnership, association or organization; and

  • (c) the general partner of a limited partnership controls the limited partnership.

• Marginal note:Subsidiary

  (4) A person or entity is a subsidiary of another person or entity if

  • (a) it is controlled by

    • (i) that other person or entity,

    • (ii) that other person or entity and one or more persons or entities, each of which is controlled by that other person or entity, or

    • (iii) two or more persons or entities, each of which is controlled by that other person or entity; or

  • (b) it is a subsidiary of a subsidiary of that other person or entity.

• Marginal note:Limited clearing member

  (5) For the purposes of subsection 11.11(4) of the Act, a limited clearing member means a participant in a clearing and settlement system designated under subsection 4(1) of the Act who, under the rules of the system,

  • (a) is not required to contribute to a default fund;

  • (b) is not required to absorb any losses arising from the default of another participant in the system other than a reduction in the amount of variation margin gain that is returnable to the participant if the gain results from a transaction that was entered into by the participant and the defaulting participant and subsequently submitted for clearing to the clearing house of the system; and

  • (c) is subject to additional initial margin.

• Marginal note:Ownership interest

  (6) In these Regulations, a reference to an ownership interest in a clearing house does not include shares of the clearing house.