Two firms are seeking exemptions from the requirement that clearing agencies be recognized by the Ontario Securities Commission.

On March 1, 2011, changes to securities legislation will take effect that will prohibit clearing agencies from carrying on business in Ontario unless they are recognized as a clearing agency by the OSC, or are exempt from the requirement to be recognized.

In Thursday’s OSC Bulletin, it was reported that a couple of firms applied for exemptions on the basis that they only perform limited clearing functions. SS&C Technologies Canada Corp. is seeking an exemption on the basis that as a matching service utility it performs only limited clearing agency functions and is already subject to a regulatory framework. As an MSU, the firm provides centralized facilities for the institutional trade comparison and matching process.

Omgeo Matching Ltd. has applied for an exemption on the same basis. It is also an MSU.

OSC staff are prepared to recommend that the commission grant the exemptions, subject to comments they may receive, and with certain terms and conditions set out in draft orders published in the OSC Bulletin, concerning systems and technology, financial reporting, outsourcing and information sharing and regulatory cooperation.

Comments are due by January 24.

IE