Key changes to Payments Canada by-laws strengthen and support expanded membership
Understanding the latest updates to By-laws No. 1 and 3.
Payments Canada has implemented amendments to By-laws No. 1 and 3. These amendments reflect changes to the Canadian Payments Act (CP Act) and the introduction of the Retail Payment Activities Act (RPAA). The goal of these updates is to support broadened Payments Canada membership and participation eligibility and promote competition and innovation in the payment ecosystem, while ensuring alignment with the evolving regulatory landscape.
By-law No. 1: Broadening membership and council structure
By-law No. 1, which governs membership and advisory council criteria, has been updated to reflect the changes in membership eligibility and the composition of the Stakeholder Advisory Council (SAC).
The amendments introduce and expand existing requirements for membership to reflect new eligible members. In alignment with amendments to the CP Act and regulatory requirements under the RPAA, payment service providers (PSPs) applying for membership must be registered under the RPAA and provide proof of registration. This change confirms that only PSPs supervised by the Bank of Canada are eligible for membership and harmonizes with existing application criteria.
Similarly, clearing houses will be required to demonstrate that their clearing and settlement system is designated under the Payment Clearing and Settlement Act (PCSA), and credit union locals will be required to provide evidence that they accept deposits transferable by order.
Amendments also clarify that the SAC will maintain its representative character by continuing to allow appointment of non-member PSPs. This ensures the SAC broadly includes payment service providers and users, as stipulated by the CP Act.
By-law No. 3: Participation and compliance for credit unions
By-law No. 3 details the requirements for exchanging, clearing and settling payment items through the Automated Clearing Settlement System (ACSS), Canada's retail batch payment system. Amendments aim to clarify the roles of credit unions and support system participation eligibility.
One change clarifies the roles and responsibilities for both member and non-member credit union locals regarding compliance with Payments Canada's by-laws and rules. A credit union local that becomes a member must comply with Payments Canada’s by-laws and rules. A member that clears on behalf of a non-member local will remain responsible for ensuring the non-member local complies as if it were a member. This change is a direct result of the expansion of membership eligibility to credit union locals that are a member of a central.
Amendments also clarify that the composition of a group may include locals, regardless of whether or not they are Payments Canada members. This change aligns with the current group clearer structure in the ACSS for the credit union sector.
Technical amendments have also been made to harmonize terms used in the by-laws with those in the CP Act. This ensures consistent wording with the enabling legislation, adds clarity to regulatory provisions and improves overall consistency.
For more information about our rules and by-laws, including the development or amendment process, please visit our Rules and documentation webpage.
