CSA Derivatives Reporting with Novatus Global
Ensuring compliance with Canada’s derivatives reporting obligations to enhance market transparency and mitigate systemic risk since the 2008 financial crisis.
Different regulations:
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CSA derivatives reporting adheres to a combination of National Instruments and Provincial or Territory based rules. Ontario, Manitoba, and Quebec have historically been the key contributors to the rules and published the original drafts for CSA reporting as part of Canada’s G20 commitments following the 2008 financial crisis. Collectively, these rules require all derivatives transactions involving at least one “local counterparty” are reported to the CSA to enable the monitoring of systemic risk in the Canadian economy.
Who is Required to Report Under CSA Derivatives Reporting?
As described under Part 3 of the OSC Rules, the reporting obligation may fall to one of the following entities:
- Clearing Agencies
- Derivatives Dealers, both financial and non-financial entities
- Swap Execution Facilities (SEFs) if instructed by the reporting party
Are There Exemptions from CSA Reporting?
Yes, under CSA reporting there are a handful of scenarios in which all the parties involved in the transaction are exempt from any reporting obligations to the CSA, these are:
- Transactions between a government and its consolidated entity
- Inter-Affiliate transactions
- Transactions between a local counterparty that only satisfies Section (b) of that definition and a non-local counterparty.
- E.g. A derivatives transaction between a European bank that is a derivatives dealer in Ontario and another European bank.
Different regulations:
1
Products
CSA reporting applies to all derivatives products with a handful of exceptions, examples of these include:
- FX Spot transactions that settle in T+2 or earlier and are not part of an FX Swap
- FX transactions that are entered into for the purpose of settling a related security
- CO transactions other than cash or currency which are entered into with the intent to be settled by physical delivery of the underlying asset
2
Timing
CSA requires reporting of all creation and continuation data no later than 48 hours after the Execution Timestamp reported in the transaction. There is also an obligation for the Trade Repository to make a subset of price related fields available to the public within the same timeframe.
3
Rewrite
The CSA Rewrite is schedule to go-live on July 25th, 2025. The new technical specifications align closely with the CDE guidance. There are 148 reportable data elements post-rewrite which can be broken into these categories:
- 114 fields – CDE Elements
- 25 fields – CFTC Elements
- 4 fields – ESMA Elements
- 5 fields – Unique to CSA elements
Who Do Firms Report To?
Firms must report to a Designated Trade Repository recognized by the CSA. At the time of writing, these Trade Repositories are:
- DTCC Data Repository
- Chicago Mercantile Exchange
- ICE Trade Vault
Is CSA Reporting Single or Double-Sided?
CSA is a single-sided reporting regime, meaning only one version of a transaction is ever reported. Where both parties hold a reporting obligation, there must be a reporting party determination in absence of any alternative arrangement. Determining the entity who holds the reporting obligation for a given transaction depends on several factors, including:
Entity definition (SEF/Clearing Agency/Derivatives Dealer)
Entity classification (financial vs non-financial)
Domicile (US-person vs non-US person)
Counterparty terms as stipulated by the SEF (where applicable)
Bilateral counterparty agreement
Consequences of Non-Compliance with CSA Reporting
- Monetary Penalties for failure to comply with reporting requirements.
- Cease Trading orders preventing firms from participating in the derivatives market.
- Public Disclosure of non-compliance.
How Novatus Global Can Streamline Your CSA Reporting
- The need to submit errors and omissions notifications to the regulator as soon as practicably possible.
- The need outlined under Section 26.1 (c) for the reporting counterparty to verify that the reported derivatives data does not contain an error or omission at least every 30 days.
CSA Reporting FAQs
We transform the daunting process of obtaining regulatory approval into a streamlined, stress-free experience. Our seasoned experts not only handle the intricate details of application preparation (including Regulatory Business Plans and financial analysis) and compliance but also provide strategic insights to ensure application success.
We transform the daunting process of obtaining regulatory approval into a streamlined, stress-free experience. Our seasoned experts not only handle the intricate details of application preparation (including Regulatory Business Plans and financial analysis) and compliance but also provide strategic insights to ensure application success.
We transform the daunting process of obtaining regulatory approval into a streamlined, stress-free experience. Our seasoned experts not only handle the intricate details of application preparation (including Regulatory Business Plans and financial analysis) and compliance but also provide strategic insights to ensure application success.
We transform the daunting process of obtaining regulatory approval into a streamlined, stress-free experience. Our seasoned experts not only handle the intricate details of application preparation (including Regulatory Business Plans and financial analysis) and compliance but also provide strategic insights to ensure application success.
We transform the daunting process of obtaining regulatory approval into a streamlined, stress-free experience. Our seasoned experts not only handle the intricate details of application preparation (including Regulatory Business Plans and financial analysis) and compliance but also provide strategic insights to ensure application success.
We transform the daunting process of obtaining regulatory approval into a streamlined, stress-free experience. Our seasoned experts not only handle the intricate details of application preparation (including Regulatory Business Plans and financial analysis) and compliance but also provide strategic insights to ensure application success.
We transform the daunting process of obtaining regulatory approval into a streamlined, stress-free experience. Our seasoned experts not only handle the intricate details of application preparation (including Regulatory Business Plans and financial analysis) and compliance but also provide strategic insights to ensure application success.
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