Government of Canada / Gouvernement du Canada
Symbol of the Government of Canada

Search

Payment Clearing and Settlement Act

Version of section 2 from 2017-12-14 to 2019-06-22:


Marginal note:Definitions

 The following definitions apply in this Act.

Bank

Bank means the Bank of Canada. (banque)

Canadian participant

Canadian participant means a participant that is incorporated or formed under an enactment of Canada or a province. (participant canadien)

central counter-party

central counter-party means a corporation, association, partnership, agency or other entity in a clearing and settlement system with whom all participant’s payment rights and obligations are netted to produce a single amount owing as between each participant and the central counter-party. (intermédiaire)

clearing and settlement system

clearing and settlement system means a system or arrangement for the clearing or settlement of payment obligations or payment messages in which

  • (a) there are at least three participants, at least one of which is a Canadian participant and at least one of which has its head office in a jurisdiction other than the jurisdiction where the head office of the clearing house is located;

  • (b) clearing or settlement is all or partly in Canadian dollars; and

  • (c) except in the case of a system or arrangement for the clearing or settlement of derivatives contracts, the payment obligations that arise from clearing within the system or arrangement are ultimately settled through adjustments to the account or accounts of one or more of the participants at the Bank.

For greater certainty, it includes a system or arrangement for the clearing or settlement of securities transactions, derivatives contracts, foreign exchange transactions or other transactions if the system or arrangement also clears or settles payment obligations arising from those transactions. (système de compensation et de règlement)

clearing house

clearing house means a corporation, association, partnership, agency or other entity that provides clearing or settlement services for a clearing and settlement system. It includes a securities and derivatives clearing house, as defined in subsection 13.1(3), but does not include a stock exchange or the Bank. (chambre de compensation)

eligible financial contract

eligible financial contract has the same meaning as in subsection 22.1(2) of the Winding-up and Restructuring Act. (contrat financier admissible)

Minister

Minister means the Minister of Finance. (ministre)

participant

participant means a party to an arrangement that establishes a clearing and settlement system. (établissement participant)

payments system risk

payments system risk means the risk that a disruption to or a failure of a clearing and settlement system could cause a significant adverse effect on economic activity in Canada by

  • (a) impairing the ability of individuals, businesses or government entities to make payments, or

  • (b) producing a general loss of confidence in the overall Canadian payments system, which includes payment instruments, infrastructure, organizations, market arrangements and legal frameworks that allow for the transfer of monetary value. (risque pour le système de paiement)

systemic risk

systemic risk means the risk that the inability of a participant to meet its obligations in a clearing and settlement system as they become due, or a disruption to or a failure of a clearing and settlement system, could, by transmitting financial problems through the system, cause

  • (a) other participants in the clearing and settlement system to be unable to meet their obligations as they become due,

  • (b) financial institutions in other parts of the Canadian financial system to be unable to meet their obligations as they become due,

  • (c) the clearing and settlement system’s clearing house or the clearing house of another clearing and settlement system within the Canadian financial system to be unable to meet its obligations as they become due, or

  • (d) an adverse effect on the stability or integrity of the Canadian financial system. (risque systémique)

  • 1996, c. 6, s. 162 (Sch., s. 2)
  • 2007, c. 29, s. 110
  • 2012, c. 5, s. 213, c. 31, s. 168
  • 2014, c. 39, s. 360
  • 2017, c. 33, s. 188
Date modified: