CANADA: Bourse de Montreal Amendments to Eligibility of Criterion for Index Options

Friday January 22 2016

The Rules and Policies Committee of Bourse de Montréal Inc has approved amendments to article 6602 of Rule Six of the Bourse in order to change the eligibility criterion for indices to qualify as underlying interests for an option listed on the Bourse. The proposed amendments seek to introduce a qualitative criterion specifying the considerations taken into account by the Bourse in selecting an index as an underlying interest for one of its options.

The amendments were self-certified in accordance with the self-certification process as defined in the Derivatives Act (CQLR, Chapter I-14.01). They came into effect and were incorporated into the version of the Rules of the Bourse on the Bourse’s website on January 21, 2016.

Specifically, with regard to the qualification of underlying interests, the regulation now read as follows:

• In the case of an index administrator must have governance arrangements in place designed to protect the integrity of the index and must be considered to have a methodology for constructing and maintaining the index that is sufficiently transparent to facilitate a stakeholder’s ability to understand the methodology and to evaluate the credibility of the index.

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