Guideline E-22 Margin Requirements for Non-Centrally Cleared Derivatives

Under OSFI Guideline E-22, Margin Requirements for Non-Centrally Cleared Derivatives, most Federally Regulated Financial Institutions meeting the definition of a covered entity (“Covered FRFIs”) are subject to the mandatory exchange of variation margin beginning on March 1, 2017.

OSFI is aware of the transitional measures taken in other major jurisdictions in order to avoid causing substantial disruptions to the derivatives market. Given the global nature of this market, OSFI recognizes that a harmonized implementation of the variation margin requirements would be helpful in ensuring a level playing field and a stable derivatives market for Canadian FRFIs.

Therefore, OSFI will provide some relief to FRFIs with respect to the mandatory exchange of variation margin that begins on March 1. For FRFIs transacting with counterparties that do not present a significant exposure to them, OSFI now expects those FRFIs to meet the variation margin requirements by no later than September 1, 2017.