Good idea to inform OFSI of data processing outside Canada

It is good practice for any financially-regulated entities (FREs) that process or maintain data outside Canada such as insurers or reinsurers to inform OSFI of their arrangements, thereby preventing any potential future surprises, according to Emilie Kydd, an associate with Lang Michener LLP. Bill C-37 has eliminated the requirement for FREs to obtain superintendent approval to process certain data outside Canada, Kydd writes in an article posted on International Law Office’s Web site. Even so, there are still instances in which FREs must process or maintain certain data in Canada if specified directly by OSFI and must comply with the direction “without delay,” Kydd notes. “FREs must continue to ensure that OSFI has access to data and information relating to the preparation and maintenance of certain corporate, accounting and customer records that are maintained or processed outside Canada,” she writes. “In addition, if an arrangement to process or maintain information or data outside Canada would constitute a material outsourcing arrangement under Guideline B-10, FREs are still required to comply with Guideline B-10 to ensure that they follow the risk management programme for material outsourcing arrangements.”