Okay.
The PCSA was enacted in 1996 primarily to address systems that settle payment obligations. While it's been updated since that time to provide for the clearing of securities and derivatives, many of the legal protections in the act are worded in a way that they simply do not apply to the clearing of derivatives contracts. For example, the protections for enforceability of settlement rules in section 8 of the act are limited to clearing house rules that provide for the calculation, netting or settlement of payment obligations. It's doubtful whether these necessary protections extend to the clearing of derivatives contracts and the transfers of collateral and other assets that support derivatives clearing systems.
To sum up within the time that I have, the purpose of these amendments is simply to fix up the wording of the PCSA so that the legal protections that it provides clearly apply to the type of clearing that goes on in these now all-important central counterparty systems for clearing derivatives.
I'll add one final point. This has a competitive aspect as well, because currently Canadian banks that were very active in the derivatives markets are restricted from participating in some of these offshore CCPs because of the concerns of those CCPs and their regulators about potential gaps in Canadian law.
Thank you.