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Commission Implementing Decision (EU) 2021/1104 of 5 July 2021

on the recognition of the legal, supervisory and enforcement arrangements of Canada for derivatives transactions supervised by the Office of the Superintendent of Financial Institutions as equivalent to certain requirements of Article 11 of Regulation (EU) No 648/2012 of the European Parliament and of the Council on OTC derivatives, central counterparties and trade repositories (Text with EEA relevance)

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Article 2

Financial servicesLevel 2Implementing DecisionEMIRIn forceOfficial source

For the purposes of Article 13(3) of Regulation (EU) No 648/2012, the legal, supervisory and enforcement arrangements of Canadafor the exchange of collateral that are applied to non-centrally cleared derivative transactions regulated by OSFI, with the exeption of phisically settled commodity derivatives, shall be considered as equivalent to the requirements set out in Article 11(3) of Regulation (EU) No 648/2012 as further specified in Delegated Regulation (EU) 2016/2251, where the following conditions are satisfied:

2(a)

(a)at least one of the counterparties to those transactions is established in Canada and is subject to the margin requirements of Canada;

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2(b)

(b)transactions are marked-to-market and, where variation margin is required to be provided under Regulation (EU) No 648/2012, variation margin is exchanged on the same day on which it is calculated;

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By way of derogation from point (b), where it is established between the counterparties that variation margin cannot consistently be provided on the same day in which it is calculated, the legal, supervisory and enforcement arrangements of Canada shall also be considered as equivalent to the requirements of Article 11(3) of Regulation (EU) No 648/2012 where variation margin is provided within two business days of its calculation and the margin period of risk used to calculate initial margin is adjusted accordingly.