The Autorité des marchés financiers today announced the establishment of a Centre of Excellence for Derivatives.

The AMF says that the purpose of the centre is to provide Quebec with modern and flexible regulatory instruments that can effectively foster the growth of the derivatives industry in Quebec while ensuring maximum protection for investors.

This initiative follows the AMF’s announcement in May 2006 of a proposal to modernize the regulation of derivatives markets and the publication of a discussion paper on the issue. In a few weeks, the AMF will publish for comment a principles-based regulatory framework, including legislative and regulatory provisions as well as policy statements. The AMF will be promoting a harmonized approach with the rest of Canada and aiming for government approval in 2008.

The centre will be headed by Derek West. He will be based in Chicago to be able to follow market developments in North America more effectively, to promote Québec derivatives expertise in the rest of Canada and the U.S., and to establish relations and co-operation between the centre and other North American stakeholders.

Prior to acting as a derivatives consultant to the AMF, West held a number of functions in the financial sector, including the position of director of strategic planning and business development at the National Futures Association in Chicago.

Daniel Laurion, AMF executive director, special projects, will assume responsibility for the centre within the AMF.

The centre will be mandated to:

  • co-ordinate the activities conducted by the various AMF units involving derivatives in order to enhance their effectiveness, consistency and timeliness;
  • ensure the development and implementation of a modern framework for derivatives markets in Québec;
  • further the ongoing development of the derivatives industry in Québec;
  • disseminate information about new Québec regulations among all stakeholders; expand the AMF’s international relations and collaborative efforts with respect to derivatives;
  • raise awareness among politicians, regulatory authorities and socio-economic groups about the importance of the derivatives markets;
  • promote Québec expertise in the area of derivatives; and
  • carry out regular monitoring of developments that impact derivatives markets and regulations around the world to ensure that Québec remains at the forefront of the industry.

“The derivatives market in Québec is enjoying substantial growth. The Montreal Exchange, which specializes in derivatives, is growing at a remarkable pace. Accordingly, the AMF has every intention to assist the Quebec derivatives industry and support the Montreal Exchange by means of modern and flexible regulations to help ensure that Quebec plays a leading role in derivatives markets internationally,” said Pierre Bernier, executive vice president of the AMF, in a news release.

“We believe that our proposal for a regulatory derivatives framework holds much potential for Quebec, and the establishment of a new Centre of Excellence for Derivatives will be of great benefit in this regard,” added Bernier.