Canada Gazette, Part I, Volume 153, Number 11: By-law Amending the Canada Deposit Insurance Corporation Data and System Requirements By-law
March 16, 2019
Statutory authority
Canada Deposit Insurance Corporation Act
Sponsoring agency
Canada Deposit Insurance Corporation
REGULATORY IMPACT ANALYSIS STATEMENT
(This statement is not part of the By-law.)
Background
Pursuant to paragraphs 11(2)(f.1) and (f.2) of the Canada Deposit Insurance Corporation Act (CDIC Act), the Board of Directors of the Canada Deposit Insurance Corporation (CDIC) is authorized to make by-laws respecting the information that the CDIC can require from member institutions with respect to their deposit liabilities, as well as the time and manner in which it is to be provided, and respecting the capabilities that the CDIC can require member institutions to have, including the capability to identify their deposit liabilities and temporarily prevent withdrawals of deposit liabilities, all with a view to facilitating the Corporation’s exercise of its functions under section 14 of the CDIC Act or in the event that an order is made under subsection 39.13(1) of the CDIC Act. The CDIC Board of Directors made the Canada Deposit Insurance Corporation Data and System Requirements By-law (By-law) on December 8, 2010, pursuant to this authority. The By-law requires member institutions to implement a method of identifying, capturing, organizing, and producing deposit liability data with the objective to ensure that in the event of failure, the member institution has certain data readily available and organized properly to allow the CDIC to undertake a resolution. The By-law was previously amended on March 5, 2015.
Issues
The proposed By-law Amending the Canada Deposit Insurance Corporation Data and System Requirements By-law (Amending By-law) will facilitate the update and implementation of technical specifications that reflect the enhanced coverage framework by delinking the technical specifications from the By-law. Technical amendments are also needed to align the By-law with the Canada Deposit Insurance Corporation Differential Premiums By-law to clarify that an attestation surrounding compliance in all material respects must be provided within 30 days following a request by the Corporation, to clarify the need for member institutions to have appropriate policies and procedures in place to ensure By-law compliance, and to clarify that members must be capable of explaining any instances where a data extract is inconsistent with the member institution’s records. Further amendments address unique situations that are currently not covered in the By-law, such as amalgamations and assumption of deposit liabilities, and which result in compliance issues for member institutions.
Objectives
The Amending By-law will provide greater clarity to member institutions on the applicable requirements and provide greater flexibility to the Corporation and member institutions to facilitate compliance in the context of the enhanced coverage framework.
Description
The table below provides a description of the proposed amendments.
| Amending By-law Section | By-law Section | Explanation |
|---|---|---|
| 1, 2 | 1(1), 2(1) and 2(2) | To repeal the definitions of "Data Requirements" and "standardized data," and to reorganize certain sections of the By-law so that the Data Requirements would no longer be incorporated by reference. |
| 2 | 2(3) | Amendments formalize the current practice that member institutions develop and implement policies and procedures that ensure compliance with the By-law. |
| 2 | 3 | Amendments clarify the information that must be provided to the Corporation upon request. |
| 2 | 4 | Amendments reflect that member institutions must certify compliance in all material respects with the By-law within 30 days after a request by the Corporation as opposed to annually as part of the Return of Insured Deposits. |
| 2 | 5(1), (2) and (3) | Amendments reflect that a member institution is required to provide the Corporation with a plan to become compliant with the By-law not later than 30 days after it becomes a member institution, and that it must comply with the By-law as soon as feasible but no later than 18 months after the day on which it becomes a member institution. Amendments also require such a plan where a member institution amalgamates with another institution or where a member institution assumes deposit liabilities of another institution. |
“One-for-One” Rule
The “One-for-One” Rule does not apply to this proposal, as there is no change in administrative costs to business.
Small business lens
The small business lens does not apply to this proposal, as there are no costs to small business.
Alternatives
There are no available alternatives. The amendments must be done by way of by-law.
Consultation
The proposed amendments do not significantly impact member institutions and provide member institutions with a necessary and appropriate degree of flexibility and additional clarity. Therefore, only consultation by way of prepublication in the Canada Gazette, Part I, is necessary.
Rationale
The proposed Amending By-law will ensure the By-law is clear, flexible and enforceable. The Amending By-law would achieve the stated objective and address the identified issues. The Amending By-law would not impose any additional regulatory costs or administrative burden on industry.
Implementation, enforcement and service standards
The proposed Amending By-law would come into force on the day on which it is registered. There are no compliance or enforcement issues.
Contact
Emiel van der Velden
Director
Insurance
Canada Deposit Insurance Corporation
50 O’Connor Street, 17th Floor
Ottawa, Ontario
K1P 6L2
Telephone: 613‑943‑2773
Email: evandervelden@cdic.ca
PROPOSED REGULATORY TEXT
Notice is given that the Board of Directors of the Canada Deposit Insurance Corporation, pursuant to paragraphs 11(2)(f.1) footnote a and (f.2)footnote a of the Canada Deposit Insurance Corporation Act, proposes to make the annexed By-law Amending the Canada Deposit Insurance Corporation Data and System Requirements By-law footnote b.
Interested persons may make representations concerning the proposed By-law within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to Emiel van der Velden, Director, Insurance, Canada Deposit Insurance Corporation, 50 O’Connor Street, 17th Floor, Ottawa, Ontario K1P 6L2 (email: evandervelden@cdic.ca).
Ottawa, March 8, 2019
Peter Routledge
President and Chief Executive Officer
Canada Deposit Insurance Corporation
By-law Amending the Canada Deposit Insurance Corporation Data and System Requirements By-law
Amendments
1 The definitions Data Requirements and standardized data in subsection 1(1) of the Canada Deposit Insurance Corporation Data and System Requirements By-law footnote 1 are repealed.
2 The heading before section 2 and sections 2 to 6 of the By-law are replaced by the following:
Obligations of Member Institutions
Capabilities
2 (1) For the purpose of facilitating the Corporation’s exercise of its functions under section 14 of the Act or in the event that an order is made under paragraph 39.13(1)(a), (b) or (c) of the Act, every member institution must be capable of
- (a) producing the following data, as of the determination time, in relation to its deposit liabilities — other than those posted in the records of a foreign branch of the member institution — and providing that data or making it available to the Corporation in a usable format no later than the time referred to in subsection (2):
- (i) data that enables the Corporation to identify and contact each depositor and ascertain their preferred official language of communication and their province of residence,
- (ii) data that enables the Corporation to identify and group those deposit liabilities by
- (A) unique depositor,
- (B) eligibility to be insured by the Corporation,
- (C) insurance category, and
- (D) account type, and
- (iii) the interest accrued and payable in relation to each deposit as of the determination date; and
- (b) temporarily preventing withdrawals of deposit liabilities or any portion of them according to account type within six hours of receiving instructions from the Corporation.
Time limit — provision of data
(2) The member institution must be capable of providing or making available to the Corporation the data referred to in paragraph (1)(a) no later than
- (a) in the case of the data referred to in subparagraph (1)(a)(iii),
- (i) if the determination time occurs on or after the determination date, the earlier of
- (A) 30 hours after the determination time, and
- (B) 4:00 pm on the second day after the determination date, and
- (ii) if the determination time occurs before the determination date, 4:00 p.m. on the second day after the determination date; and
- (i) if the determination time occurs on or after the determination date, the earlier of
- (b) in the case of any other data,
- (i) if the determination time occurs on or after the determination date, the earlier of
- (A) six hours after the determination time, and
- (B) 4:00 p.m. on the day after the determination date, and
- (ii) if the determination time occurs before the determination date, 4:00 p.m. on the day after the determination date.
- (i) if the determination time occurs on or after the determination date, the earlier of
Policies and procedures
(3) The member institution must develop and implement policies and procedures to ensure that it has the capabilities referred to in this section.
Provision of information and evidence
3 Every member institution must, on request of the Corporation and within the period set out in the request,
- (a) provide to the Corporation a copy of the policies and procedures referred to in subsection 2(3);
- (b) inform the Corporation of the time by which all of the transactions made on a given day are processed and posted to the deposit liability records of the depositors of the member institution;
- (c) provide or make available to the Corporation the data referred to in subparagraphs 2(1)(a)(i) to (iii), including as of a time or date specified by the Corporation if there is no determination time or determination date;
- (d) demonstrate that any data provided or made available to the Corporation reconciles with the records of the member institution and explain any variances; and
- (e) provide or make available to the Corporation any other evidence that the member institution has the capabilities referred to in section 2.
Certification
4 Every member institution must, within 30 days after a request by the Corporation to that effect, certify whether it has, in all material respects, the capabilities referred to in section 2 and whether it adheres to the policies and procedures referred to in subsection 2(3).
Timing of compliance
5 (1) Subject to subsections (2) and (3), an institution must
- (a) provide to the Corporation, not later than 30 days after it becomes a member institution, a plan to become compliant with this By-law; and
- (b) comply with this By-law as soon as feasible and in any event not later than 18 months after the day on which it becomes a member institution.
Amalgamated member institutions
(2) A member institution that results from an amalgamation of two or more institutions must
- (a) in respect of the deposit liabilities of any amalgamating institution that was a member institution for less than 18 months before the amalgamation date,
- (i) provide to the Corporation, not later than 30 days after the amalgamation date, a plan to become compliant with this By-law, and
- (ii) comply with this By-law as soon as feasible and in any event not later than 18 months after the day on which the amalgamating institution became a member institution;
- (b) in respect of the deposit liabilities of any amalgamating institution that was not a member institution before the amalgamation date,
- (i) provide to the Corporation, not later than 30 days after that date, a plan to become compliant with this By-law, and
- (ii) comply with this By-law as soon as feasible and in any event not later than 18 months after the amalgamation date; and
- (c) in respect of its other deposit liabilities, comply with this By-law without delay.
Assumed deposit liabilities
(3) A member institution that assumes deposit liabilities of another institution must, in respect of the assumed liabilities,
- (a) provide to the Corporation, not later than 30 days after the day on which it assumes the deposit liabilities, a plan to become compliant with this By-law; and
- (b) comply with this By-law as soon as feasible and in any event not later than 18 months after the day on which it assumes the deposit liabilities.
Coming into Force
3 This By-law comes into force on the day on which it is registered.