Yesterday, the Canadian Securities Administrators published Consultation Paper 91-406 describing the CSA Derivatives Committee's proposals relating to central counterparty clearing of over-the-counter derivatives. The consultation paper is the latest in a series of eight papers intended to build on the high-level proposals found in Consultation Paper 91-401 released in November 2010.

Ultimately, the paper proposes that regulators make CCP clearing of eligible OTC derivatives mandatory. Under the Committee's recommendations, CSA members would also develop rules and procedures to determine the eligibility of OTC derivatives contracts for central clearing and procedures for the recognition of CCPs and the approval of CCP rules and policies in regards to the clearing of OTC derivatives contracts.

Comments on the consultation paper are being accepted until September 21, 2012.