Settlement Systems, Futures, and Emissions Units Bill

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Settlement Systems, Futures, and Emissions Units Bill

Government Bill

252—2

As reported from the Commerce Committee

Commentary

Recommendation

The Commerce Committee has examined the Settlement Systems, Futures, and Emissions Units Bill and recommends that it be passed with the amendments shown.

Introduction

The Settlement Systems, Futures, and Emissions Units Bill is designed to align New Zealand’s clearing and settlement system with international best practice, and to facilitate trading in futures and emissions units.

Definition of insolvency

We recommend amending clause 6, section 156M, by deleting the definition of “insolvency” and replacing it with a new definition of “becomes subject to an insolvency event”. We recommend this as new section 156S (see below) removes the finality protection provided in new section 156R in respect of a participant’s settlements 24 hours after the participant becomes subject to a specified insolvency event. It is therefore critical that the moment at which a participant becomes subject to an insolvency event is clear.

Inserting the new definition of “becomes subject to an insolvency event” provides this clarity by specifying that a participant becomes subject to an insolvency event on the date on which, and (if specified) the time at which, an insolvency officer is appointed in respect of the participant. This provides a clear point in time at which a participant becomes subject to an insolvency event.

We recommend consequential changes to 156S(1), (2), and (3); and 156ZK.

Rules not to be considered regulations

We recommend amending clause 6 by inserting new subsection 156N(6) to make it clear that the rules of a designated settlement system are not to be considered “regulations” under the Regulations (Disallowance) Act 1989 or the Acts and Regulations Publication Act 1989, and hence subject to the risk of disallowance by the Regulations Review Committee. It was never the intention that rules should be considered regulations under these Acts.

Insolvency and the finality of settlement

We propose several amendments to avoid potential problems in the event that a participant in a settlement transaction became subject to an insolvency event while the settlement was only partly completed. While such a situation is unlikely, we consider it wise to close any gap, especially in the current global financial climate.

Part 5C of the Reserve Bank of New Zealand Act 1989 provides settlement system participants and operators with certainty that settlements conducted through designated settlement systems are final and cannot be challenged. This protection is a departure from the general law of insolvency and it is therefore appropriate to limit its effect; the benefits of settlement finality must be balanced against the right of creditors to prove their claims in the case of insolvency. The bill as introduced provides that the finality protection extends until the earlier of 24 hours after the commencement of the insolvency or when the designated settlement system’s contact person has notice or ought to have notice of the insolvency.

We recommend amending clause 6 by removing new section 156S(2)(b) so that finality protection would extend for 24 hours after the commencement of an insolvency, regardless of when the contact person had notice. This would remove uncertainty over the receipt of notice, while maintaining a 24-hour window after the commencement of an insolvency to complete any settlements that were already in progress.

We further recommend amending clause 6 by inserting a new section 156S(2)(b) so that an insolvent participant could regain finality protection if its transactions were duly authorised by the relevant insolvency officer appointed upon insolvency. Due authorisation could take the form of a general authorisation to accept all settlements, avoiding the need to authorise each settlement separately. This recommendation is based on the principle that the relevant insolvency officer should not be deprived of the protections of Part 5C while trying to manage the insolvency.

We recommend a consequential amendment to clause 6 replacing new subsection 156S(3).

Interaction with other Acts

We recommend amendments to clause 6 new sections 156U, 156V, and 156W to clarify how the new sections introduced by this bill would interact with existing provisions in the Companies Act 1993, the Insolvency Act 2006, and the Insolvency (Cross-border) Act 2006. The amendments to 156U and 156V clarify which legislation would apply to “netting” under the rules of a designated settlement system and to “netted balances” as defined by the Companies Act and the Insolvency Act. The effect of the above amendments would be that any transactions subject to netting under the rules of a designated settlement system would be netted in accordance with those rules and that the general setting-off provisions in section 310 of the Companies Act or 254 of the Insolvency Act would then apply to the resulting balance and any transactions between the parties that were not netted under the rules of the designated settlement system.

The amendment to 156W states the intention of the bill that these provisions prevail over the Insolvency (Cross-border) Act with regard to settlements made in accordance with the rules of a designated settlement system.

Transfers

We recommend amending clause 6, section 156X(1), to address a potential definitional problem involving the requirement that transfers be between two or more “participants” in a designated settlement system. The bill as introduced could potentially exclude the registry interface in a transfer, resulting in some transfers within a settlement system being covered by this section while others fell outside it and remained covered by the Securities Transfer Act 1991. By providing for section 156X to apply more generically to all transfers that occur in accordance with the rules of a designated settlement system, the proposed amendment would avoid such duplication of regulatory oversight.

We also recommend inserting new section 156X(4) to clarify that the transfer of legal title to securities in accordance with the rules of a designated settlement system is effective despite any law to the contrary. This would ensure that transfers under the rules of a designated settlement system received the same protection as transfers under an electronic system approved under the Securities Transfer Act 1991.

Matters to be considered by regulators

We recommend amending clause 6 by inserting new sections 156Z(2)(ea) and 156ZI(1)(ea) to expressly include the adequacy of a settlement system’s financial resources among the factors that may be considered by the regulators in deciding whether to grant, vary, or revoke a designation. In the light of recent financial market failures, we consider this addition a worthwhile precaution, along with the existing general reference to considering the capability and capacity of the system operators.

We also recommend that clause 6 be amended by inserting new sections 156Z(2)(fa) and 156ZI(1)(fa) to include, as a factor that the regulators may consider in decisions regarding a designation, the impact on participants’ creditors of specifying that a settlement system operator’s interest in property transferred to the operator by a participant, or in which the participant has granted a security interest to the operator, has priority over security interests in the property under new section 103A of the Personal Property Securities Act 1999.

In reviewing the assessment criteria to be used by regulators in approving, varying, or revoking a designation, we considered whether the final criterion—“any other matters that the regulator considers appropriate” (clause 6, new section 156Z(2)(g))—was overly broad. However, we concluded that it was appropriate to retain this more general criterion in order to allow the regulators to take into account new issues that may arise as markets evolve. We acknowledge the importance of consistency in the criteria used, but consider that this would be safeguarded through the checks and balances brought to bear by having joint regulators.

Shortened disallowance period

We recommend amending clause 6, inserting new section 156ZC(3)(a), by shortening the period within which the joint regulators could disallow a proposed amendment to the rules of a designated settlement system from 40 working days to 20. The bill proposes that the regulators must be notified of any possible amendments to the rules “as soon as practicable”, but that the regulators would have in effect up to eight weeks to disallow the amendments. We believe this to be unnecessarily long. We recommend further amending new section 156ZC(3)(a) so that, should the regulators decide not to disallow an amendment, they could notify the contact person of the designated settlement system and allow the amendment to come into effect earlier than the end of 20 working days.

Penalties

The bill proposes various penalties for offences relating to a designated settlement system, ranging from fines and imprisonment to revocation of designation. It was submitted that revocation of designation was the only necessary and effective penalty. We considered this carefully and concluded that a range of penalties is appropriate, as revocation is an extreme measure. Without lesser penalties, minor or even moderate offences that did not warrant revocation might go unpunished. This would inevitably undermine the system. There is also a need for penalties against individuals, as we believe the possibility of employees being held personally accountable would greatly increase the incentive to comply.

Regarding the nature of the penalties, after comparing those in other jurisdictions we propose one change to the level of penalty for corporate bodies. We recommend that clause 6, new section 156ZQ, be amended to decrease the maximum fine for a body corporate from $1 million to $750,000, bringing it into line with other jurisdictions.

Definition of emissions units

We recommend that clauses 27, 33, and 36—covering the definition of emissions units to be inserted, respectively, into the Securities Act 1978, the Securities Markets Act 1988, and the Personal Property Securities Act 1999—be amended to include units created in accordance with any enactment of a jurisdiction within another country, or any international treaty or protocol. We also recommend that these clauses be amended to include the storage of greenhouse gases in the definition.

The carbon market is still in its infancy, so we consider that the definition of “emissions units” should be broadened to allow for the evolution of this market. This might involve technological developments in the way carbon is managed and stored, and developments in the sources of carbon credits. Regarding sources, for example, we note that increasingly carbon credits are being issued by state or local governments, under international treaties and protocols, and through legal or contractual arrangements, in addition to being issued by central governments. We believe the definition specified in the bill needs to be wide enough to cover such other potential sources of credits.

It was submitted that the term “emissions units’ should be replaced with “environmental units”, to allow for the possible development of other forms of environment-related tradeable rights. While we recognise that this may prove to be pertinent to future developments, we believe such a change would go beyond the intention of the current bill.

Issuing of certificates and the transfer of securities

We recommend the consequential insertion of new clauses 9A, 10A, 10B, 10C, and 10D to ensure that the provisions in the Securities Act 1978 and the Companies Act 1993 relating to the issue of certificates and the transfer of securities are the same for electronic systems approved under the Securities Transfer Act 1991 and systems designated under new Part 5C of the Reserve Bank of New Zealand Act 1989.

Other issues considered by the committee

Joint regulators

The bill provides for joint oversight of designated settlement systems by the Reserve Bank of New Zealand and the Securities Commission. In response to a number of submissions, we considered whether a single regulator would be preferable, but concluded that the joint approach proposed in the bill is appropriate. We note that the bill already provides for the Reserve Bank to be the sole regulator of settlement systems that are purely payment systems.

Both the Securities Commission and the Reserve Bank of New Zealand have a legitimate interest in the operation of settlement systems in the financial sector, and each brings its own perspective and areas of expertise. We consider that it would be valuable to have both perspectives and to be able to draw on broader expertise.

We note that the Reserve Bank might itself apply for designation in its role as operator of Austraclear. As a joint regulator, the Securities Commission reinforces the separation between the Reserve Bank’s roles of settlement system regulator and operator.

We also note that the bill includes provisions to help the joint regulators work together and avoid unnecessary duplication.

Voluntary designation

It was submitted that the bill needs to ensure that the designated settlement system remains optional, as the cost associated with designation could create barriers to entry and increased costs for market participants. We agree and would like to point out that the explanatory note states that designation is optional.

We do, however, consider that creditors and other holders of registered security interests should be made aware of the possibility that their security interests would take lower priority to a trade on a designated settlement system. As noted above, we propose that this should be among the matters considered by the joint regulators in granting a designation.

Futures and forward transactions

It was submitted that the bill does not adequately delineate between futures trading and physical forward transactions and that the bill appears to include centrally cleared physical forward transactions in the definition of securities. We consider that futures trading and physical forward transactions are distinct, that the bill does make this distinction, by referring to the existing definition of futures in Section 37 of the Securities Markets Act 1988 which adequately and appropriately distinguishes between futures and forwards, and that the bill would not alter the way in which physical forward transactions are treated under the Securities Act 1978 and the Securities Markets Act 1988.

Relationship to the New Zealand Emissions Trading Scheme

The bill contains various technical amendments to existing legislation designed to facilitate the development of markets for emissions units. It should be noted that none of the amendments are necessary for the operation of the New Zealand Emissions Trading Scheme; the amendments are designed purely to facilitate trading in units, and would apply regardless of whether the units are issued under a statutory scheme or in the voluntary market.

Appendix

Committee process

The Settlement Systems, Futures, and Emissions Units Bill was referred to the Commerce Committee of the 48th Parliament on 25 September 2008. The closing date for submissions was 5 February 2009. The bill was reinstated in the 49th Parliament on 9 December 2008. We received and considered 12 submissions from interested groups and individuals. We heard four submissions.

We received advice from the Ministry of Economic Development, the Reserve Bank of New Zealand, and the Securities Commission.

Committee membership

Hon Lianne Dalziel (Chairperson)

John Boscawen

Charles Chauvel

Clare Curran

Te Ururoa Flavell

Jo Goodhew

Melissa Lee

Peseta Sam Lotu-Iiga

Katrina Shanks

Key to symbols used

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Hon Simon Power

Settlement Systems, Futures, and Emissions Units Bill

Government Bill

252—2

Contents

1 Title

2 Commencement

Part 1
Reserve Bank of New Zealand Act 1989

3 Principal Act amended

4 Interpretation

5 Moratorium

6 New Part 5C substituted

Part  5C
Designated settlement systems

General

156K Exercise of powers under this Part

156L Commission may exercise powers under Securities Act 1978

156M Definitions for this Part

Designation

156N Designation of settlement system

156O Joint regulators' recommendations subject to procedure in sections 156Y to 156ZA

Effect of designation

156P Application of this Part to pure payment systems

156Q Rules of designated settlement system are valid and enforceable

156R Settlements must not be reversed, etc

156S Limits on application of section 156R(1)

156T Netting is valid and enforceable

156U Interrelationship between netting and Companies Act 1993 and Insolvency Act 2006

156V Underlying transactions, settlements, and limits on effect of sections 156Q, 156R, and 156T

156W Interrelationship with other enactments

156X Transfer of property in accordance with rules is effective

Procedure for making designation

156Y Application for designation

156Z Consideration of application

156ZA Decision on application

Amendments to rules

156ZB Joint regulators must be notified of proposed amendments to rules

156ZC Proposed amendments to rules may be disallowed

Variation and revocation of designation

156ZD Variation of designation

156ZE Revocation of designation

156ZF Settlement and netting not affected by variation or revocation of designation

156ZG Application for variation or revocation of designation

156ZH Either joint regulator may independently begin review of designation

156ZI Matters joint regulators may have regard to in recommending variation or revocation of designation

156ZJ Procedure for variation or revocation of designation

Obligations to give notice and supply information

156ZK Contact person must be notified of insolvency event

156ZL Supply of information relating to designated settlement system

Disclosure of information

156ZM Disclosure of information between joint regulators

156ZN Disclosure of information to third parties

156ZO Limits on further disclosure of information

156ZP Application of other enactments to information published or disclosed under section 156ZN

Penalties for offences against this Part

156ZQ Penalties for offences

Part 2
Savings provision and amendments to other Acts

Savings provision

7 Amendments do not affect existing designations

Amendments to Securities Act 1978

8 Amendments to Securities Act 1978

9 Functions of Commission

9A Issuers to issue certificates evidencing securities

10 Schedule 1 amended

Amendments to Companies Act 1993

10A Amendments to Companies Act 1993

10B Interpretation

10C Transfer of shares under approved system

10D Share certificates

Amendment to Personal Property Securities Act 1999

11 Amendment to Personal Property Securities Act 1999

Priority of interests of certain operators of designated settlement system

103A Priority of interests of certain operators of designated settlement system

Part 3
Securities Markets Act 1988

12 Principal Act amended

13 Interpretation

14 Part 2B heading substituted

15 Power to exempt securities markets from this Part

16 New section 36F substituted

36F Registration of exchanges

17 Registered exchange must operate securities markets with conduct rules that include required matters and have effect

18 Required matters for conduct rules

19 Determination on whether or not to apply approval process to proposed conduct rules and changes

20 Registered exchange must not operate new securities market if proposed conduct rules or changes not approved

21 Conduct rules must be available for inspection

22 Registered exchange must give Commission material information given to market participants

23 Commission may give directions to registered exchanges

24 Grounds for other directions

25 Notice, opportunity for exchange to act, and submissions before Commission gives directions

26 Notice and opportunity to be heard and represented after Commission gives direction

27 Interpretation of terms used in this Part

28 Dealers in futures contracts to be authorised

29 Penalties for failing to comply with Part 2B

30 Further amendments to principal Act

31 Amendments to other enactments

Part 4
Personal Property Securities Act 1999

32 Principal Act amended

33 Interpretation

34 Meaning of “possession” in certain cases

Part 5
Securities Act 1978

35 Principal Act amended

36 Interpretation

Schedule 1
Further amendments to principal Act

Schedule 2
Amendments to other enactments

The Parliament of New Zealand enacts as follows:

1 Title

  • This Act is the Settlement Systems, Futures, and Emissions Units Act 2008.

2 Commencement

  • This Act comes into force on the day after the date on which it receives the Royal assent.

Part 1
Reserve Bank of New Zealand Act 1989

3 Principal Act amended

  • This Part amends the Reserve Bank of New Zealand Act 1989.

4 Interpretation

  • (1) The definition of clearing house in section 2(1) is repealed.

    (2) Section 2(1) is amended by repealing the definition of designated payment system and substituting the following definition:

    “designated settlement system has the meaning set out in section 156M”.

    (3) Section 2(1) is amended by repealing the definition of operator and substituting the following definition:

    “operator, in relation to either a settlement system or a payment system, means any person that provides clearing, settlement, or processing services to participants in respect of that system”.

    (4) Section 2(1) is amended by repealing the definition of participant and substituting the following definition:

    “participant, in relation to either a settlement system or a payment system,—

    • “(a) means a person who has agreed to participate in either a settlement system or a payment system in accordance with the rules of that system; and

    • “(b) in the case of a designated settlement system, includes an operator of the settlement system if the designation under section 156N(3)(b) so provides”.

    (5) Section 2(1) is amended by inserting the following definitions in their appropriate alphabetical order:

    “settlement system has the meaning set out in section 156M

    “specified operator has the meaning set out in section 156M”.

5 Moratorium

  • Section 122(8) is amended by omitting “designated payment system” in each place where it appears and substituting in each case “designated settlement system”.

6 New Part 5C substituted

  • Part 5C is repealed and the following Part substituted:

    “Part  5C
    “Designated settlement systems

    “General

    “156K Exercise of powers under this Part

    • “(1) The powers conferred on the Minister and the Bank by this Part must be exercised for the purposes of—

      • “(a) promoting the maintenance of a sound and efficient financial system; and

      • “(b) avoiding significant damage to the financial system that could result from the failure of a participant in a settlement system.

      “(2) The powers conferred on the Minister responsible for the Securities Act 1978 and the Commission by this Part must be exercised for the purposes of—

      • “(a) promoting the integrity and effectiveness of securities markets and settlement systems and related markets in New Zealand; and

      • “(b) enhancing the confidence of investors and other market participants in securities markets and settlement systems and related markets in New Zealand.

      “(3) The Governor-General must exercise the powers conferred on him or her by this Part for the purposes set out in subsections (1) and (2).

    “156L Commission may exercise powers under Securities Act 1978

    • “(1) The Commission may exercise any of its powers under the Securities Act 1978 in performing its functions and duties, and exercising its powers, under this Act, and Part 3 of the Securities Act 1978 applies with all necessary modifications to its decisions and proceedings under this Act.

      “(2) However, for the purposes of this Part, the Commission may exercise its powers under sections 67 and 67A of the Securities Act 1978 in relation to the Bank only if, and to the extent that, the Bank is—

      • “(a) a participant in a settlement system; or

      • “(b) an operator of a settlement system.

    “156M Definitions for this Part

    • “(1) In this Part, unless the context otherwise requires,—

      “Commission means the Securities Commission established under Part 1 of the Securities Act 1978

      “contact person, in relation to a settlement system, means the person specified under section 156N(2)(d)

      “designated settlement system means a settlement system that is declared to be a designated settlement system under section 156N

      “insolvency means,—

      • “(a) in the case of a company or other body corporate,—

        • “(i) liquidation under Part 16 of the Companies Act 1993 or under any other Act; or

        • “(ii) voluntary administration under Part 15A of the Companies Act 1993; or

        • “(iii) statutory management under Part 3 of the Corporations (Investigation and Management) Act 1989; or

        • “(iv) statutory management under Part 5 of this Act; or

        • “(v) liquidation, winding up, voluntary administration, statutory management, or other similar process under any other enactment or rule of law (whether of New Zealand or of another country); and

      • “(b) in the case of an individual,—

        • “(i) being adjudged a bankrupt under the Insolvency Act 2006 or any corresponding enactment (whether of New Zealand or of another country); or

        • “(ii) being admitted to the no asset procedure in subpart 4 of Part 5 of the Insolvency Act 2006 or other similar process under any other enactment or rule of law (whether of New Zealand or of another country)

      “joint regulators means—

      • “(a) the Bank; and

      • “(b) the Commission

      “Minister responsible for the Securities Act 1978 means the Minister of the Crown who, under the authority of any warrant or with the authority of the Prime Minister, is for the time being responsible for the administration of the Securities Act 1978

      “netted balance means any amount calculated under in accordance with the netting provisions of the rules of a designated settlement system as the net debit payable by, or on behalf of, a participant in the designated settlement system to, or on behalf of, another participant in that system for all or any claims or obligations to which those rules apply

      “netting means the conversion into 1 net claim or obligation, or the set-off, of different claims or obligations between participants in a settlement system that results from the issue and receipt of settlement instructions involving 2 or more participants in the settlement system or that is otherwise provided for under the rules of the settlement system,—

      • “(a) whether on a bilateral or multilateral basis; and

      • “(b) whether or not through the interposition of an operator of the settlement system (whether by novation or otherwise); and

      • “(c) whether or not the obligations or claims constitute mutual credits, mutual debts, or other mutual dealings; and

      • “(d) whether or not the obligations or claims are denominated in New Zealand currency

      “property means personal property

      “pure payment system means a designated settlement system that is a payment system that is declared to be a pure payment system in accordance with section 156N(3)(d)

      “rules,—

      • “(a) in relation to a settlement system, means the rules of the settlement system (whether made under bylaws, agreements, procedures, contracts, or other documents) that are evidenced in writing and that provide, among other things, for—

        • “(i) the basis on which settlement instructions are given or received; and

        • “(ii) the basis on which settlement obligations are determined and calculated (either on a gross basis or using netting); and

        • “(iii) the basis on which settlements are effected (either on a gross basis or using netting); and

        • “(iv) any action to be taken if a participant in the settlement system is unable, or likely to become unable, to meet the participant's obligations to any or all of the following:

          • “(A) an operator of the settlement system:

          • “(B) another participant in the settlement system:

          • “(C) any other party to those rules; and

      • “(b) in relation to a designated settlement system, means the rules of that settlement system that are contained in documents specified in the designation under section 156N; and includes any amendments to those rules that have—

        • “(i) been notified, not been disallowed, and come into effect in accordance with the processes and the time frames set out in sections 156ZB and 156ZC; or

        • “(ii) been made pursuant to a variation of a designation under section 156ZD

      “settlement means—

      • “(a) the making of a payment or the transfer of the title to, or an interest in, property—

        • “(i) that is done in accordance with, or to give effect to, a settlement instruction; and

        • “(ii) that is on a gross basis or that uses netting; and

        • “(iii) whether by way of book entry on the accounts of a central bank or an operator of a settlement system or otherwise; or

      • “(b) any other act that discharges an obligation to make a payment or transfer the title to, or an interest in, property in accordance with the rules of a settlement system

      “settlement instruction means an instruction given by a participant in, or to an operator of, a settlement system—

      • “(a) that is made in accordance with the rules of that settlement system; and

      • “(b) that results, or is intended to result, in 1 or more settlements being effected

      “settlement system—

      • “(a) means a system or arrangement for effecting settlements or processing settlement instructions in accordance with rules; and

      • “(b) includes a payment system

      “specified operator means the operator of a settlement system specified in an Order in Council in accordance with section 156N(2)(c).

      “(2) In this Part, a participant becomes subject to an insolvency event on the date on which, and (if specified) the time at which,—

      • “(a) in the case of a company or other body corporate,—

        • “(i) a liquidator is appointed in respect of a liquidation under Part 16 of the Companies Act 1993 or under any other Act; or

        • “(ii) an administrator is appointed in respect of a voluntary administration under Part 15A of the Companies Act 1993; or

        • “(iii) a liquidator is appointed in respect of a liquidation of an overseas company under section 342 of the Companies Act 1993; or

        • “(iv) a statutory manager is appointed in respect of a statutory management under Part 3 of the Corporations (Investigation and Management) Act 1989; or

        • “(v) a statutory manager is appointed in respect of a statutory management under Part 5 of this Act; or

        • “(vi) a person is appointed in respect of, or another event occurs that indicates the start of, a process in New Zealand or in any other country in which the company or other body corporate was incorporated, created, or established that is similar to those set out in subparagraphs (i) to (v); and

      • “(b) in the case of an individual,—

        • “(i) a person is adjudicated bankrupt under the Insolvency Act 2006 or is given, or determined to have, a similar status (whether in New Zealand or in another country); or

        • “(ii) a person is admitted to the no asset procedure in subpart 4 of Part 5 of the Insolvency Act 2006 or becomes subject to a similar procedure (whether in New Zealand or in another country).

    “Designation

    “156N Designation of settlement system

    • “(1) The Governor-General may, by Order in Council, on the advice of both the Minister and the Minister responsible for the Securities Act 1978 given in accordance with a joint recommendation of the joint regulators, declare any settlement system to be a designated settlement system.

      “(2) The order must specify—

      • “(a) the settlement system that is the subject of the designation; and

      • “(b) the documents that evidence the rules of that settlement system; and

      • “(c) which operator of the settlement system is the specified operator; and

      • “(d) the name or title of the person to whom notices relating to that settlement system must be given (the contact person).

      “(3) The order may also specify all or any of the following:

      • “(a) conditions to which the designation is subject:

      • “(b) that a particular operator is a participant in the settlement system that is the subject of the designation:

      • “(c) that the operator specified in accordance with subsection (2)(d) (2)(c) is an operator to whom section 103A of the Personal Property Securities Act 1999 applies:

      • “(d) that the settlement system that is the subject of the designation is a pure payment system.

      “(4) Both of the joint regulators must, as soon as practicable after a settlement system has been declared to be a designated settlement system, post on their respective Internet sites the contact details and the name or title of the contact person of that designated settlement system.

      “(5) However, the Commission does not have to comply with subsection (4) if a settlement system is specified to be a pure payment system in accordance with subsection (3)(d).

      “(6) To avoid doubt, rules are not regulations for the purposes of the Regulations (Disallowance) Act 1989 and the Acts and Regulations Publication Act 1989.

    “156O Joint regulators' recommendations subject to procedure in sections 156Y to 156ZA

    • The procedure set out in sections 156Y to 156ZA must be followed by the joint regulators when they make a recommendation under section 156N(1).

    “Effect of designation

    “156P Application of this Part to pure payment systems

    • “(1) If a designated settlement system is specified to be a pure payment system in accordance with section 156N(3)(d), then this Part applies to that designated settlement system as follows:

      • “(aa) all references to a settlement must be read as if they were references to a settlement as defined in subsection (4); and

      • “(a) for the purposes of sections 156K, 156M, and 156ZB to 156ZQ, the Bank is the sole regulator of that settlement system; and

      • “(b) all references to the joint regulators in sections 156K, 156M, and 156ZB to 156ZQ must be read as if they were references to the Bank; and

      • “(c) anything in sections 156K, 156M, and 156ZB to 156ZQ that may or must be done by both of the joint regulators may or must be done by the Bank alone; and

      • “(d) except as set out in subsection (2), in performing its functions and duties and exercising its powers under sections 156K, 156M, and 156ZB to 156ZQ, the Bank does not have to consult with, advise, or give notice to, the Commission; and

      • “(e) section 156L does not apply; and

      • “(f) the advice of the Minister responsible for the Securities Act 1978 is not required under section 156ZD or 156ZE; and

      • “(g) sections 156Q, 156R, and 156T apply only to the extent that they relate to the making of a payment; and

      • “(h) this Part must be interpreted with all necessary modifications in order to give effect to this section.

      “(2) However, if the Bank intends to recommend, in accordance with section 156ZD (applied as set out in subsection (1)), that a designated settlement system's designation is varied so that it is no longer specified to be a pure payment system, the Bank must consult with the Commission before making that recommendation.

      “(3) This section ceases to apply to a designated settlement system if, in accordance with section 156ZD (applied as set out in subsection (1)), that settlement system's designation is varied so that it is no longer specified to be a pure payment system.

      “(4) For the purposes of subsection (1)(aa), settlement means—

      • “(a) the making of a payment—

        • “(i) that is done in accordance with, or to give effect to, a settlement instruction; and

        • “(ii) that is on a gross basis or that uses netting; and

        • “(iii) whether by way of book entry on the accounts of a central bank or an operator of a settlement system or otherwise; or

      • “(b) any other act that discharges an obligation to make a payment in accordance with the rules of a settlement system.

    “156Q Rules of designated settlement system are valid and enforceable

    • “(1) The rules of a designated settlement system are valid and enforceable despite any enactment or rule of law to the contrary.

      “(2) However, subsection (1) applies only to the extent that the rules provide for—

      • “(a) the basis on which settlement instructions are given or received; and

      • “(b) the basis on which settlement obligations are determined and calculated (either on a gross basis or using netting); and

      • “(c) the basis on which settlements are effected (either on a gross basis or using netting); and

      • “(d) any action to be taken if a participant in the designated settlement system is unable, or likely to become unable, to meet the participant's obligations to any or all of the following:

        • “(i) the specified operator of the designated settlement system:

        • “(ii) another participant in the designated settlement system:

        • “(iii) any other party to those rules.

    “156R Settlements must not be reversed, etc

    • “(1) A settlement that is effected in accordance with the rules of a designated settlement system must not, whether in whole or in part, be reversed, repaid, recovered, or set aside despite any enactment or rule of law to the contrary.

      “(2) Subsection (1) extends to any application made to a New Zealand court by a foreign court, foreign representative, or foreign creditor to reverse, repay, recover, or set aside a settlement (whether in whole or in part) that relates to an insolvency (in any form, whether personal or corporate) that is within the jurisdiction of the relevant foreign court, foreign representative, or foreign creditor.

      “(3) In this section,—

      “foreign court means a judicial or other authority competent to control or supervise a foreign proceeding

      “foreign proceeding means a collective judicial or administrative proceeding in a foreign jurisdiction, including an interim proceeding, under a law relating to insolvency (in any form, whether personal or corporate), in which proceeding the assets and affairs of the debtor are subject to control or supervision by a foreign court, for the purpose of reorganisation or liquidation

      “foreign representative means a person or body, including one appointed on an interim basis, authorised in a foreign proceeding to administer the reorganisation or the liquidation of the debtor's assets or affairs or to act as a representative of the foreign proceeding.

      “Compare: 2006 No 57 Schedule 1 Article 2

    “156S Limits on application of section 156R(1)

    • “(1) Section 156R(1) does not apply to a settlement that is effected under in accordance with the rules of a designated settlement system if—

      • “(a) a participant in the designated settlement system in respect of whom the settlement is effected becomes subject to an insolvency event insolvent (the insolvent participant); and

      • “(b) the settlement is effected after the commencement of that insolvency the insolvent participant becomes subject to an insolvency event.

      “(2) Despite subsection (1), section 156R(1) applies to the settlement if—

      • “(a) the settlement is effected within 24 hours of the commencement of the insolvency after the insolvent participant becomes subject to an insolvency event; and or

      • “(b) the contact person can demonstrate that the contact person did not have notice of the commencement of the insolvency at the time that the settlement was effected.

      • “(b) the settlement instruction that gives rise to the settlement is duly authorised on behalf of the insolvent participant after the insolvent participant becomes subject to an insolvency event.

      “(3) For the purposes of subsection (2), a contact person is taken to have notice of the commencement of an insolvency if—

      • “(a) the contact person fails to make any inquiries into the matter that a reasonable person would have made in the circumstances; or

      • “(b) the contact person fails to have regard to any public notice of the commencement of the insolvency that a reasonable person would have had regard to in the circumstances.

      “(3) For the purposes of subsection (2), authorised on behalf of the insolvent participant means authorised (either individually or as part of a broader authorisation) by—

      • “(a) a liquidator appointed under Part 16 of the Companies Act 1993 or under any other Act; or

      • “(b) an administrator appointed in accordance with subpart 2 of Part 15A of the Companies Act 1993; or

      • “(c) a statutory manager appointed in accordance with section 38 of the Corporations (Investigation and Management) Act 1989; or

      • “(d) a statutory manager appointed in accordance with section 117 of this Act; or

      • “(e) a person who performs a role similar to those set out in paragraphs (a) to (d) in respect of a process in New Zealand or in any other country in which the insolvent participant was incorporated, created, or established that is similar to those set out in section 156M(2)(a)(i) to (v); or

      • “(f) a person who is authorised to do so under any enactment or rule of law of New Zealand or of any other country in which the insolvent participant was incorporated, created, or established; or

      • “(g) the Assignee nominated under section 59 of the Insolvency Act 2006 to be the Assignee of a bankrupt's property or any person who performs a similar role in respect of a process (whether in New Zealand or in another country) that is, or is similar to, bankruptcy.

    “156T Netting is valid and enforceable

    • If the rules of a designated settlement system provide for netting, any netting under in accordance with those rules is valid and enforceable despite any enactment or rule of law to the contrary.

    “156U Certain provisions of Interrelationship between netting and Companies Act 1993 and Insolvency Act 2006 not to apply to netting

    • “(1) The following provisions do not apply to any netting under in accordance with the rules of a designated settlement system:

      • “(a) sections 310A 310 to 310O of the Companies Act 1993:

      • “(b) sections 255 254 to 262 of the Insolvency Act 2006.

      “(2) However, a netted balance is to be treated as—

      • “(a) an amount to which section 310(1) of the Companies Act 1993 applies if a company that is in liquidation and another party (both of whom are participants in a designated settlement system) also have mutual credits, mutual debts, or other mutual dealings between them that are not netted in accordance with the rules of the designated settlement system; and

      • “(b) an amount to which section 254(1) of the Insolvency Act 2006 applies if the bankrupt (as defined in section 3 of that Act) and another party (both of whom are participants in a designated settlement system) also have mutual credits, mutual debts, or other mutual dealings between them that are not netted in accordance with the rules of the designated settlement system.

    “156V Limits Underlying transactions, settlements, and limits on effect of sections 156Q, 156R, and 156T

    • “(1) Nothing in section 156Q, 156R, or 156T prevents—

      • “(a) the operation of any enactment or rule of law in relation to an underlying transaction (including, without limitation, sections 56, 292, 297, and 298 of the Companies Act 1993 and section 194 of the Insolvency Act 2006); or 

      • “(b) any party from taking action against another party that has acted fraudulently or dishonestly so long as the remedy sought or obtained in respect of that action does not affect the application of section 156Q, 156R, or 156T.

      “(2) If a person brings an action under any enactment or rule of law in relation to an underlying transaction (including, without limitation, sections 56, 292, 297, and 298 of the Companies Act 1993 and section 194 of the Insolvency Act 2006), that person may produce evidence of a settlement before the court for the purpose of proving that—

      • “(a) a participant received value by means of that settlement; and

      • “(b) the value received was an element of the underlying transaction.

      “(2A) Nothing in section 292(4A) of the Companies Act 1993 or section 196 of the Insolvency Act 2006 applies to—

      • “(a) an underlying transaction; or

      • “(b) a settlement that was effected in accordance with the rules of a designated settlement system.

      “(3) In this section, underlying transaction—

      • “(a) means a transaction that gives gave rise to—

        • “(i) a settlement; or

        • “(ii) a settlement obligation; but

      • “(b) does not include—

        • “(i) a settlement instruction; or

        • “(ii) a settlement that was effected in accordance with the rules of a designated settlement system; or

        • “(iii) any novation of the obligations of a participant in a designated settlement system that is was completed in accordance with the rules of that designated settlement system.

    “156W Certain Interrelationship with other enactments prevail over sections 156Q, 156R, and 156T

    • “(1) The following enactments prevail over sections 156Q, 156R, and 156T:

      • “(a) sections 122(8) and 127(4) of this Act:

      • “(b) sections 42(8) and 44(4) of the Corporations (Investigation and Management) Act 1989.

      “(2) This Part prevails over the Insolvency (Cross-border) Act 2006.

    “156X Transfer of personal property by means of settlement in accordance with rules is effective

    • “(1) Subsection (2) applies if—

      • “(a) personal property is transferred between 2 or more participants in a designated settlement system; and

      • “(b) that transfer is a settlement within the meaning of paragraph (a) of the definition of settlement in section 156M; and

      • “(c) that transfer is made in accordance with the rules of that designated settlement system.

      “(1) Subsection (2) applies if property is transferred in accordance with the rules of a designated settlement system.

      “(2) If this subsection applies, no person may refuse to take an action on the ground that the transfer was not effective.

      “(3) Nothing in this section affects any right a person has to refuse to take an action on any other ground.

      “(3) Nothing in this section—

      • “(a) affects any right a person has to refuse to take an action on any other ground; or

      • “(b) derogates from section 45G(3) of the Reserve Bank of New Zealand Act 1964 (as continued in force by section 84 of the Public Finance Act 1989).

      “(4) Section 45I of the Reserve Bank of New Zealand Act 1964 (as continued in force by section 84 of the Public Finance Act 1989) must be read subject to this section.

      “(5) Except as provided in this section, this section has effect despite anything to the contrary in any enactment, rule of law, constitution, deed, or agreement.

    “Procedure for making designation

    “156Y Application for designation

    • “(1) A person who wishes to have a settlement system declared to be a designated settlement system may apply to either of the joint regulators.

      “(2) A joint regulator must, as soon as practicable, advise the other joint regulator if it receives an application.

      “(3) An application must—

      • “(a) be accompanied by a copy of the rules of the settlement system and any information required by either or both of the joint regulators; and

      • “(b) set out the contact details and the name or title of the person who is proposed to act as the contact person of the settlement system; and

      • “(c) be accompanied by the application fee (if any) that is jointly determined by the joint regulators and approved by both the Minister and the Minister responsible for the Securities Act 1978 by notice in the Gazette.

      “(4) The joint regulators may, together, produce guidelines relating to the application procedure.

    “156Z Consideration of application

    • “(1) Both of the joint regulators must consider any application made in accordance with section 156Y.

      “(2) In considering an application, each of the joint regulators may have regard to any or all of the following matters:

      • “(a) the purpose and scope of the settlement system:

      • “(b) the rules of the settlement system:

      • “(c) any laws or regulatory requirements relating to the operation of the settlement system and the extent to which the settlement system complies with those laws or regulatory requirements:

      • “(d) relevant international standards concerning clearing and settlement systems, to the extent that they are relevant in the circumstances:

      • “(e) the capability and capacity of the operators of the settlement system:

      • “(ea) the financial resources of the settlement system:

      • “(f) the importance of the settlement system to the financial system:

      • “(fa) the impact on creditors of participants in the settlement system of specifying that an operator of the settlement system is an operator to whom section 103A of the Personal Property Securities Act 1999 applies:

      • “(g) any other matters that the regulator considers appropriate.

      “(3) In considering an application, each of the joint regulators must consider whether the settlement system should be specified to be a pure payment system.

      “(4) In considering an application, each of the joint regulators may have regard, or refer, to, and may rely upon, any relevant information, work, or matter held, or produced, by the other joint regulator.

    “156ZA Decision on application

    • “(1) After considering an application, the joint regulators must, together, either—

      • “(a) make a joint recommendation to both the Minister and the Minister responsible for the Securities Act 1978 that the settlement system to which the application relates be declared to be a designated settlement system under section 156N; or

      • “(b) refuse to make that recommendation.

      “(2) If subsection (1)(b) applies, the joint regulators must together give notice in writing to the applicant stating—

      • “(a) that the joint regulators refuse to make a recommendation that the settlement system to which the application relates be declared to be a designated settlement system under section 156N; and

      • “(b) the reasons for the joint regulators' refusal.

    “Amendments to rules

    “156ZB Joint regulators must be notified of proposed amendments to rules

    • “(1) The specified operator of a designated settlement system must, as soon as practicable, notify either of the joint regulators of any amendment that is proposed to be made to the rules of that designated settlement system.

      “(2) A joint regulator must, as soon as practicable, advise the other joint regulator if it receives notice of a proposed amendment to the rules of a designated settlement system.

    “156ZC Proposed amendments to rules may be disallowed

    • “(1) The joint regulators may disallow any amendment that is proposed to be made to the rules of a designated settlement system by giving notice to that effect to the contact person of that designated settlement system on or before the day that is 40 20 working days after the date on which either of the joint regulators first received notice of the proposed amendment under section 156ZB(1).

      “(2) If the joint regulators disallow a proposed amendment in accordance with subsection (1),—

      • “(a) the proposed amendment does not come into effect; and

      • “(b) the rules of the designated settlement system continue to apply as they did before the amendment was proposed.

      “(3) If the joint regulators do not disallow a proposed amendment in accordance with subsection (1), the proposed amendment comes into effect on—

      • “(a) the day that is 41 working days after the date on which either of the joint regulators first received notice of the proposed amendment under section 156ZB(1); or

      • “(a) the earlier of—

        • “(i) the day after the date on which the contact person of the designated settlement system receives notice from the joint regulators that they have decided not to disallow the proposed amendment; or

        • “(ii) the day that is 21 working days after the date on which either of the joint regulators first received notice of the proposed amendment under section 156ZB(1); or

      • “(b) any later date that is specified as part of the proposed amendment.

    “Variation and revocation of designation

    “156ZD Variation of designation

    • The Governor-General may, by Order in Council, on the advice of both the Minister and the Minister responsible for the Securities Act 1978 given in accordance with a joint recommendation of the joint regulators, vary any designation made under section 156N—

      • “(a) by amending any of the matters referred to in section 156N(2)(b) to (d) and (3)(b) to (d); or

      • “(b) by making the designation subject to a requirement that an amendment be made to the documents that evidence the rules of the settlement system that is the subject of the designation; or

      • “(c) by revoking or amending any condition to which the designation is subject; or

      • “(d) by making the designation subject to a new condition.

    “156ZE Revocation of designation

    • The Governor-General may, by Order in Council, on the advice of both the Minister and the Minister responsible for the Securities Act 1978 given in accordance with a joint recommendation of the joint regulators, revoke any designation made under section 156N.

    “156ZF Settlement and netting not affected by variation or revocation of designation

    • The variation or revocation of a designation made under section 156N does not affect the application of sections 156Q, 156R, and 156T to settlements that were effected, and netting that took place, before the variation or revocation.

    “156ZG Application for variation or revocation of designation

    • “(1) A person who wishes to have the designation made under section 156N for a designated settlement system varied or revoked may apply to either of the joint regulators.

      “(2) A joint regulator must, as soon as practicable, advise the other joint regulator if it receives an application.

      “(3) An application must be accompanied by the application fee (if any) that is jointly determined by the joint regulators and approved by both the Minister and the Minister responsible for the Securities Act 1978 by notice in the Gazette.

    “156ZH Either joint regulator may independently begin review of designation

    • “(1) Either of the joint regulators may, independently of the other joint regulator and without having received an application under section 156ZG, begin a review to determine whether to recommend a variation or revocation of a designation made under section 156N.

      “(2) A joint regulator must, as soon as practicable, advise the other joint regulator if it begins a review to determine whether to recommend a variation or revocation of a designation made under section 156N.

      “(3) No fee can be charged if a joint regulator begins a review under subsection (1).

    “156ZI Matters joint regulators may have regard to in recommending variation or revocation of designation

    • “(1) In determining whether to make a recommendation that any designation made under section 156N be varied or revoked, each of the joint regulators may have regard to any or all of the following matters:

      • “(a) the purpose and scope of the designated settlement system:

      • “(b) the rules of the designated settlement system:

      • “(c) any laws or regulatory requirements relating to the operation of the designated settlement system and the extent to which the designated settlement system complies with those laws or regulatory requirements:

      • “(d) relevant international standards concerning clearing and settlement systems, to the extent that they are relevant in the circumstances:

      • “(e) the capability and capacity of the operators of the settlement system:

      • “(ea) the financial resources of the settlement system:

      • “(f) the importance of the designated settlement system to the financial system:

      • “(fa) the impact on creditors of participants in the settlement system of specifying, or no longer specifying, that an operator of the settlement system is an operator to whom section 103A of the Personal Property Securities Act 1999 applies:

      • “(g) any failure to comply with any condition to which the designation is subject:

      • “(h) any failure to comply with the requirements of this Act:

      • “(i) any other matters that the joint regulator considers appropriate.

      “(2) In determining whether to make a recommendation that any designation made under section 156N be varied or revoked, each of the joint regulators may have regard, or refer, to, and may rely upon, any relevant information, work, or matter held, or produced, by the other joint regulator.

    “156ZJ Procedure for variation or revocation of designation

    • “(1) Before making a recommendation that any designation made under section 156N be varied or revoked, the joint regulators must together—

      • “(a) give the contact person notice of—

        • “(i) the reasons for proposing to vary or revoke the designation; and

        • “(ii) the fact that the contact person may make submissions to the joint regulators in relation to the proposed variation or revocation; and

      • “(b) give the contact person an opportunity to make those submissions within a time period that the joint regulators consider reasonable in the circumstances; and

      • “(c) consider any submissions made by the contact person during that time period.

      “(2) The notice referred to in subsection (1)(a) may be given either in writing or orally depending on the circumstances of the particular case.

    “Obligations to give notice and supply information

    “156ZK Contact person must be notified of insolvency event

    • “(1) This section applies if—

      • “(a) a participant in a designated settlement system (participant A) becomes subject to an insolvency event insolvent:

      • “(b) any other participant whose settlements are effected by participant A through in accordance with the rules of that designated settlement system becomes subject to an insolvency event insolvent.

      “(2) If this section applies, participant A must, as soon as practicable after becoming aware of the insolvency event , notify that fact to the contact person of that designated settlement system.

      “(3) It is sufficient compliance with the requirement to notify the contact person under subsection (2) if—

      • “(a) participant A takes all reasonable steps to comply with that requirement; or

      • “(b) the contact person was already aware of the commencement of the insolvency event by the time participant A had to notify the contact person under that subsection.

    “156ZL Supply of information relating to designated settlement system

    • “(1) The joint regulators may, by notice in writing, require any or all of the following persons to supply the joint regulators with any information relating to any designated settlement system:

      • “(a) the specified operator of the designated settlement system:

      • “(b) a participant in the designated settlement system:

      • “(c) the contact person of the designated settlement system.

      “(2) The joint regulators may exercise the power conferred by subsection (1) only if the joint regulators consider that the information is reasonably required to enable them to perform their functions and duties, or exercise their powers, under this Part.

      “(3) A notice under subsection (1) may specify—

      • “(a) the periods for which, and the form in which, the information must be supplied; and

      • “(b) the manner in which the information must be verified.

      “(4) A person commits an offence if the person, without lawful justification or excuse, fails to supply information in accordance with this section.

      “(5) The penalty for an offence against this section is set out in section 156ZQ.

    “Disclosure of information

    “156ZM Disclosure of information between joint regulators

    • “(1) No obligation as to secrecy or other restriction upon the disclosure of information, whether imposed by an enactment or otherwise, prevents the disclosure of information between either of the following persons:

      • “(a) the Bank; and

      • “(b) the Commission.

      “(2) Subsection (1) only applies to information—

      • “(a) obtained for the purposes of the administration of this Part, whether under sections 156Z(4), 156ZI(2), or 156ZL or otherwise; and

      • “(b) that is disclosed by the Bank or the Commission in order to enable them to perform their functions and duties, or exercise their powers, under this Part.

    “156ZN Disclosure of information to third parties

    • “(1) The joint regulators may publish or disclose any information or data supplied in accordance with section 156ZL only if—

      • “(a) the information or data is available to the public under any Act or is otherwise publicly available information; or

      • “(b) the information or data is in a statistical or summary form; or

      • “(c) the publication or disclosure of the information or data is for the purposes of, or in connection with, the exercise of powers conferred by this Act; or

      • “(d) the publication or disclosure of the information or data is to any central bank, authority, or body in any other country that performs functions and duties that correspond with, or are similar to, those conferred on the joint regulators under this Part, and the joint regulators are satisfied that the information or data will be used by that central bank, authority, or body for the purpose of performing those functions or duties; or

      • “(e) the publication or disclosure of the information or data is to any person who the joint regulators are satisfied has a proper interest in receiving the information; or

      • “(f) the publication or disclosure of the information or data is with the consent of the person to whom the information relates or of the person to whom the information is confidential.

      “(2) The joint regulators must not publish or disclose information or data under subsection (1)(d) or (e) unless the joint regulators are satisfied that satisfactory provision exists to protect the confidentiality of that information or data.

      “(3) An officer or employee of either of the joint regulators must not publish or disclose any information or data supplied in accordance with section 156ZL except for the purposes of, or in connection with, the exercise of powers conferred by this Act.

      “(4) An officer or employee of either of the joint regulators commits an offence if the officer or employee contravenes this section.

      “(5) The penalty for an offence against this section is set out in section 156ZQ.

    “156ZO Limits on further disclosure of information

    • “(1) A person to whom any information or data is published or disclosed must not publish, disclose, or use that information or data unless the publication, disclosure, or use is,—

      • “(a) in the case of a publication or disclosure under section 156ZN(1)(c),—

        • “(i) for the purposes of, or in connection with, the exercise of powers conferred by this Act; and

        • “(ii) in accordance with any conditions that may be imposed by the joint regulators:

      • “(b) in the case of a publication or disclosure under section 156ZN(1)(e),—

        • “(i) authorised by the joint regulators and in accordance with any conditions that may be imposed by the joint regulators; or

        • “(ii) necessary or desirable for the performance of any function or duty, or the exercise of any power, conferred by any enactment:

      • “(c) in the case of a publication or disclosure under section 156ZN(1)(f), in accordance with the terms and conditions (if any) of the consent referred to in that paragraph.

      “(2) A person commits an offence if the person contravenes this section.

      “(3) The penalty for an offence against this section is set out in section 156ZQ.

    “156ZP Application of other enactments to information published or disclosed under section 156ZN

    • Nothing in any Act, other than this Act or the Official Information Act 1982, requires the joint regulators or any person to whom information or data has been published or disclosed under section 156ZN to make that information or data available to any other person.

    “Penalties for offences against this Part

    “156ZQ Penalties for offences

    • “(1) A person who commits an offence under any of the provisions listed in subsection (2) is liable, on summary conviction,—

      • “(a) in the case of an individual, to imprisonment for a term not exceeding 12 months or to a fine not exceeding $100,000; or

      • “(b) in the case of a body corporate, to a fine not exceeding $1,000,000 $750,000.

      “(2) The provisions are—

      • “(a) section 156ZL (which relates to failing to supply information relating to a designated settlement system):

      • “(b) section 156ZN (which relates to disclosure of information supplied in accordance with section 156ZL to third parties):

      • “(c) section 156ZO (which relates to limits on further disclosure of information).”

Part 2
Savings provision and amendments to other Acts

Savings provision

7 Amendments do not affect existing designations

  • (1) The amendments to the Reserve Bank of New Zealand Act 1989 made by the Settlement Systems, Futures, and Emissions Units Act 2008 this Act do not amend or affect—

    • (a) the designations declared under the Reserve Bank of New Zealand (Designated Payment Systems) Order 2004 (the Order); or

    • (b) any variations made to those designations before the date on which the Settlement Systems, Futures, and Emissions Units Act 2008 this Act came into force.

    (2) However,—

    • (a) the settlement systems to which the designations declared under the Order apply must be treated as if they have been specified to be pure payment systems in accordance with section 156N(3)(d), and section 156P applies to those settlement systems accordingly; and

    • (ab) any person who is an operator of any of those settlement systems on the date on which this Act comes into force must be treated as if that person had been specified as the specified operator of the relevant settlement system in accordance with section 156N(2)(c); and

    • (b) any amendment to the rules of those settlement systems, or any variation or revocation of the designation of those settlement systems, made after the date on which the Settlement Systems, Futures, and Emissions Units Act 2008 this Act came into force must be made in accordance with the Reserve Bank of New Zealand Act 1989 as amended by the Settlement Systems, Futures, and Emissions Units Act 2008 this Act as if the designations declared under the Order were declared under section 156N of the Reserve Bank Act 1989.

Amendments to Securities Act 1978

8 Amendments to Securities Act 1978

  • Sections 9 and to 10 amend the Securities Act 1978.

9 Functions of Commission

  • Section 10(1) is amended by inserting the following paragraph after paragraph (d):

    • “(da) to keep under review the law and practices relating to settlement systems (as defined in Part 5C of the Reserve Bank of New Zealand Act 1989, but not including any designated settlement system that is declared to be a pure payment system in accordance with section 156N(3)(d)) and to perform the functions and duties, and exercise the powers, given to it under that Part; and”.

9A Issuers to issue certificates evidencing securities

  • Section 54 is amended by repealing subsections (3) and (4) and substituting the following subsections:

    • “(3) Nothing in this section applies to an issuer in respect of securities that are approved for transfer under, or in accordance with the rules of, a system that does not require a certificate for the transfer of securities.

    • “(4) In this section,—

      “certificate means a certificate or any other document that properly evidences the nature, ownership, terms, and conditions of a security

      “system means—

      • “(a) a system authorised or approved under the Securities Transfer Act 1991:

      • “(b) a designated settlement system (as defined in section 156M of the Reserve Bank of New Zealand Act 1989).”

10 Schedule 1 amended

  • Schedule 1 is amended by inserting the following item after the item relating to the Local Government Act 2002: “Part 5C of the Reserve Bank of New Zealand Act 1989”.

Amendments to Companies Act 1993

10A Amendments to Companies Act 1993

  • Sections 10B to 10D amend the Companies Act 1993.

10B Interpretation

  • Section 2(1) is amended by inserting the following definition in its appropriate alphabetical order:

    “designated settlement system has the meaning set out in section 156M of the Reserve Bank of New Zealand Act 1989”.

10C Transfer of shares under approved system

  • (1) Section 85 is amended by inserting the following subsection after subsection (1):

    • “(1A) If shares in a company are transferred in accordance with the rules of a designated settlement system, the company may refuse to complete or delay the registration of the transfer of the shares if—

      • “(a) the board of the company resolves, within 30 working days of the date on which the settlement was effected, to refuse or delay registration of the transfer, and the resolution sets out in full the reasons for doing so; and

      • “(b) notice of the resolution, including those reasons, is sent to the transferor and to the transferee within 5 working days of the resolution being passed by the board; and

      • “(c) this Act or the constitution of the company expressly permits the board to refuse or delay registration for the reasons stated.”

    (2) Section 85(2) is amended by—

    • (a) omitting “subsection (1)” and substituting “subsections (1) and (1A)”; and

    • (b) inserting “effected in accordance with the rules of a designated settlement system, or” after “transfer of shares”.

10D Share certificates

  • Section 95 is amended by repealing subsection (2) and substituting the following subsection:

    • “(2) Nothing in subsections (1) or (5) applies in relation to a company the shares in which can be transferred in accordance with the rules of a designated settlement system, or under a system authorised or approved under the Securities Transfer Act 1991, that does not require a share certificate for the transfer of shares.”

Amendment to Personal Property Securities Act 1999

11 Amendment to Personal Property Securities Act 1999

  • (1) This section amends the Personal Property Securities Act 1999.

    (2) The following heading and section are inserted after section 103:

    “Priority of interests of certain operators of designated settlement system

    “103A Priority of interests of certain operators of designated settlement system

    • “(1) The interest of an operator in personal property has priority over any security interest in the same personal property if a participant in a designated settlement system has, in accordance with the rules of that designated settlement system,—

      • “(a) either—

        • “(i) granted a security interest in that personal property in favour of the operator; or

        • “(ii) transferred that personal property, or the operator's interest in that personal property, to the operator; and

      • “(b) taken that action for the purpose of, or in connection with, either—

        • “(i) effecting a settlement in accordance with the rules of that designated settlement system; or

        • “(ii) mitigating a loss that may be incurred by the operator if the participant defaults.

      “(2) Subsection (3) applies if—

      • “(a) the interest of an operator in personal property has priority under subsection (1); and

      • “(b) that interest is a security interest; and

      • “(c) the relevant participant has defaulted.

      “(3) If this subsection applies, the operator—

      • “(a) does not have to comply with section 114(1) in respect of that personal property; and

      • “(b) may immediately apply the personal property, in accordance with the rules of the designated settlement system,—

        • “(i) to satisfy the participant's obligations in respect of which the participant is in default; or

        • “(ii) to mitigate any loss incurred by the operator as a result of the participant's default.

      “(4) Whether a loss has been incurred and whether a participant has defaulted, for the purposes of this section, must be determined by reference to, and in accordance with, the rules of the designated settlement system.

      “(5) In this section,—

      “operator means an operator of a designated settlement system who is (and at the time in question remains) specified under section 156N(3)(c) of the Reserve Bank of New Zealand Act 1989 as being an operator to whom this section applies

      “participant—

      • “(a) means a person who has agreed to participate in a settlement system in accordance with the rules of that system; and

      • “(b) includes an operator of a designated settlement system if the designation under section 156N(3)(b) of the Reserve Bank of New Zealand Act 1989 so provides

      “rules means the rules of a designated settlement system, as that term is defined in paragraph (b) of the definition of rules in section 156M of the Reserve Bank of New Zealand Act 1989.

      “(6) In this section, designated settlement system, participant, and settlement have the meanings given to them by section 2(1) or 156M of the Reserve Bank of New Zealand Act 1989.”

Part 3
Securities Markets Act 1988

12 Principal Act amended

  • This Part amends the Securities Markets Act 1988.

13 Interpretation

  • (1) Section 2(1) is amended by repealing the definition of business rules and substituting the following definition:

    “business rules means the rules made by a registered exchange that govern the conduct of—

    • “(a) business on any securities markets or futures markets operated by the registered exchange:

    • “(b) persons authorised to undertake trading activities on any securities markets or futures markets operated by the registered exchange”.

    (2) Section 2(1) is amended by repealing the definition of conduct rules and substituting the following definition:

    “conduct rules means,—

    • “(a) in relation to a securities market, the business rules and listing rules of a registered exchange in relation to the securities market; and

    • “(b) in relation to a futures market, the business rules of a registered exchange in relation to the futures market”.

    (3) The definition of futures contract in section 2(1) is amended by omitting “section 37(1)” and substituting “section 37”.

    (4) Section 2(1) is amended by inserting the following definition in its appropriate alphabetical order:

    “futures market means a market, exchange, or other facility for trading in futures contracts”.

    (5) The definition of listing rules in section 2(1) is amended by omitting “securities” in each place where it appears and substituting in each case “registered”.

    (6) The definition of operate in section 2(1) is amended by inserting “or futures market” after “securities market”.

    (7) The definition of registered exchange's market in section 2(1) is repealed and the following definition substituted:

    “registered exchange's securities market means a securities market operated by a registered exchange”.

    (8) The definition of securities exchange in section 2(1) is repealed.

14 Part 2B heading substituted

  • The heading to Part 2B is repealed and the following heading substituted:

    “Part  2B
    “Registered exchanges”.

15 Power to exempt securities markets from this Part

  • (1) The heading to section 36E is amended by inserting “and futures markets” after “securities markets”.

    (2) Section 36E is amended by repealing subsection (1) and substituting the following subsection:

    • “(1) The Minister may, by notice in the Gazette, exempt a securities market, class of securities markets, futures market, or class of futures markets from any provision or provisions of this Part.”

16 New section 36F substituted

  • Section 36F is repealed and the following section substituted:

    “36F Registration of exchanges

    • “(1) A body corporate may apply to become a registered exchange—

      • “(a) in respect of 1 or more securities markets; or

      • “(b) in respect of 1 or more securities markets and 1 or more futures markets.

      “(2) A body corporate may apply to become a registered exchange by delivering to the chief executive—

      • “(a) an application for registration in the form, and containing the information, required by the chief executive; and

      • “(b) a copy of the proposed conduct rules for the securities markets and (if applicable) futures markets to be operated by the body corporate; and

      • “(c) any fees required by regulations made under section 49D and evidence of payment to the Commission of the fees, charges, or costs required to be paid to it by those regulations.

      “(3) The chief executive must register the body corporate as a registered exchange, by entering the name of the body corporate in a register, after—

      • “(a) receipt of the documents and fees referred to in subsection (2); and

      • “(b) approval of the proposed conduct rules under section 36O.”

17 Registered exchange must operate securities markets with conduct rules that include required matters and have effect

  • (1) The heading to section 36G is amended by omitting “markets” and substituting “and futures markets in accordance”.

    (2) Section 36G(1) is amended by inserting “and futures markets” after “securities markets”.

18 Required matters for conduct rules

  • Section 36H is amended by adding the following subsection as subsection (2):

    • “(2) Conduct rules for a futures market must include rules (business rules) that govern the conduct of—

      • “(a) business on that market; and

      • “(b) persons authorised to undertake trading activities on that market.”

19 Determination on whether or not to apply approval process to proposed conduct rules and changes

  • (1) Section 36N(1) is amended by repealing paragraph (a) and substituting the following paragraph:

    • “(a) the Minister is satisfied that the proposal relates to a securities market or futures market that is not operated by the registered exchange under its existing conduct rules (a new market); and”.

    (2) Section 36N is amended by repealing subsection (2) and substituting the following subsection:

    • “(2) Before applying the approval process, the Minister must have regard to—

      • “(a) the integrity and effectiveness of securities markets, futures markets, or both (as the case may be) in New Zealand; and

      • “(b) the confidence of investors in securities markets, futures markets, or both (as the case may be) in New Zealand; and

      • “(c) the extent of the difference between existing markets operated by the registered exchange and the new market; and

      • “(d) the extent of the difference between the existing conduct rules and the proposed new conduct rules or changes.”

20 Registered exchange must not operate new securities market if proposed conduct rules or changes not approved

  • (1) The heading to section 36P is amended by omitting “securities”.

    (2) Section 36P(1) is amended by inserting “or futures market” after “securities market”.

21 Conduct rules must be available for inspection

  • Section 36Q(1) is amended by inserting “or futures market” after “securities market”.

22 Registered exchange must give Commission material information given to market participants

  • Section 36ZG is amended by inserting “or futures market” after “securities market”.

23 Commission may give directions to registered exchanges

  • Section 36ZO(2) is amended by repealing paragraph (a) and substituting the following paragraph:

    • “(a) direct a registered exchange to suspend trading of either or both of the following:

      • “(i) the securities, or a class of securities, of 1 or more public issuers:

      • “(ii) 1 or more futures contracts, or a class of futures contracts, traded on a futures market operated by the registered exchange; or”.

24 Grounds for other directions

  • Section 36ZQ is amended by repealing paragraph (a) and substituting the following paragraph:

    • “(a) the direction is necessary in the public interest to protect people trading in either or both of the following:

      • “(i) the securities, or a class of securities, of 1 or more public issuers:

      • “(ii) 1 or more futures contracts, or a class of futures contracts, traded on a futures market operated by the registered exchange; but”.

25 Notice, opportunity for exchange to act, and submissions before Commission gives directions

  • Section 36ZR is amended by repealing subsection (1) and substituting the following subsection:

    • “(1) A direction may be given under section 36ZO only if—

      • “(a) the Commission has given written notice to the registered exchange, and in the case of a direction to suspend the trading of securities or a class of securities, the public issuer or issuers concerned, of—

        • “(i) its opinion that the requirements of section 36ZP or 36ZQ are satisfied; and

        • “(ii) the proposed terms of the direction; and

        • “(iii) the reasons for its opinion; and

      • “(b) after receiving the Commission's notice, the registered exchange does not take, within the reasonable period stated in the notice,—

        • “(i) in the case of a proposed direction to suspend the trading of securities or a class of securities, action to prevent that trading; or

        • “(ii) in the case of a proposed direction to suspend the trading of futures contracts, or a class of futures contracts, action to prevent that trading; or

        • “(iii) in any other case, any other action that, in the Commission's view, is adequate to assess the situation raised in the notice; and

      • “(c) the Commission has had regard to any written submissions made to it by the registered exchange, and in the case of a direction to suspend the trading of securities or a class of securities, the public issuer or issuers concerned, within that notice period; and

      • “(d) the Commission still considers that it is appropriate to give the direction to the registered exchange.”

26 Notice and opportunity to be heard and represented after Commission gives direction

  • Section 36ZT(a) is amended by omitting “the registered exchange and public issuer or issuers concerned” and substituting “the registered exchange, and in the case of a direction to suspend the trading of securities or a class of securities, the public issuer or issuers concerned,”.

27 Interpretation of terms used in this Part

  • (1) The definition of authorised futures exchange in section 37(1) is amended by inserting the following paragraph after paragraph (a):

    • “(ab) a body corporate that is a registered exchange in respect of securities markets and futures markets whose conduct rules for futures markets have effect under section 36I:”.

    (2) The definition of commodity in section 37(1) is amended by omitting “and a financial instrument” and substituting “, a financial instrument, and emissions units”.

    (3) Paragraph (e) of the definition of futures contract in section 37(1) is amended by inserting “Act or any” after “to which this”.

    (4) Section 37(1) is amended by inserting the following definitions in their appropriate alphabetical order:

    “emissions units means—

    • “(a) units as defined in section 4(1) of the Climate Change Response Act 2002; and

    • “(b) personal property that—

      • “(i) is created by, or in accordance with, any enactment (whether of New Zealand or of, another country, or any jurisdiction of any country), rule of law, or contractual provision, or international treaty or protocol as—

        • “(A) one of a fixed number of units issued by reference to a specified amount of greenhouse gas; or

        • “(B) evidence of a specified amount of reductions, removals, avoidance, or storage, sequestration, or any other form of mitigation of greenhouse gas emissions; and

      • “(ii) can be surrendered, retired, cancelled, or otherwise used to—

        • “(A) offset greenhouse gas emissions under, or otherwise comply with, any enactment (whether of New Zealand or of, another country, or any jurisdiction of any country), rule of law, or contractual provision, or international treaty or protocol; or

        • “(B) enable a person who surrenders, retires, cancels, or otherwise uses it to claim an environmental benefit

    “greenhouse gas has the meaning set out in section 31 of the Climate Change Response Act 2002”.

    (5) Section 37(2) is amended by omitting “this Part of”.

    (6) Section 37(7) is amended by omitting “this Part of” in each place where it appears.

28 Dealers in futures contracts to be authorised

  • (1) Section 38 is amended by repealing subsection (1) and substituting the following subsection:

    • “(1) No person may carry on the business of dealing in futures contracts unless that person—

      • “(a) is, or is a member of a class of persons that is, authorised by the Commission by notice in the Gazette to carry on the business of dealing in futures contracts; or

      • “(b) has been approved by an authorised futures exchange under its rules to carry on the business of dealing in futures contracts on the futures markets operated by the authorised futures exchange.”

    (2) Section 38(2) is amended by omitting “subsection (1)” and substituting “subsection (1)(a)”.

    (3) Section 38(3) is amended by omitting “this section” and substituting “subsection (1)(a)”.

    (4) Section 38 is amended by adding the following subsection:

    • “(4) For the purposes of subsection (1)(b), rules, in relation to an authorised futures exchange within the meaning of paragraph (ab) of the definition of authorised futures exchange in section 37(1), means conduct rules.”

29 Penalties for failing to comply with Part 2B

  • Section 43B(1) is amended by omitting “securities” and substituting “registered”.

30 Further amendments to principal Act

  • Each of the provisions of the principal Act specified in Schedule 1 is amended by omitting “registered exchange's market” in each place where it appears and substituting in each case “registered exchange's securities market”.

31 Amendments to other enactments

  • (1) Each of the provisions of each of the Acts specified in Part 1 of Schedule 2 is amended by omitting “registered exchange's market” in each place where it appears and substituting in each case “registered exchange's securities market”.

    (2) Each of the provisions of each of the regulations specified in Part 2 of Schedule 2 is amended by omitting “registered exchange's market” in each place where it appears and substituting in each case “registered exchange's securities market”.

    (3) In its continuing application under section 444 of the Insolvency Act 2006, section 72(2)(e) of the Insolvency Act 1967 must be read as if the reference to a registered exchange's market was a reference to a registered exchange's securities market.

    (4) Clause 28 of the Schedule of the Takeovers Code Approval Order 2000 is amended by repealing subclause (1) and substituting the following subclause:

    • “(1) Subject to subclause (2), an offeror must immediately send a written notice of any variation of the offeror's offer to—

      • “(a) every offeree; and

      • “(b) the target company; and

      • “(c) the Panel; and

      • “(d) the registered exchange (if any voting securities of the target company are quoted on the registered exchange's securities market).”

Part 4
Personal Property Securities Act 1999

32 Principal Act amended

  • This Part amends the Personal Property Securities Act 1999.

33 Interpretation

  • (1) Section 16(1) is amended by inserting the following definitions in their appropriate alphabetical order:

    “emissions units means—

    • “(a) units as defined in section 4(1) of the Climate Change Response Act 2002; and

    • “(b) personal property that—

      • “(i) is created by, or in accordance with, any enactment (whether of New Zealand or of, another country, or any jurisdiction of any country), rule of law, or contractual provision, or international treaty or protocol as—

        • “(A) one of a fixed number of units issued by reference to a specified amount of greenhouse gas; or

        • “(B) evidence of a specified amount of reductions, removals, avoidance, storage, or sequestration, or any other form of mitigation of greenhouse gas emissions; and

      • “(ii) can be surrendered, retired, cancelled, or otherwise used to—

        • “(A) offset greenhouse gas emissions under, or otherwise comply with, any enactment (whether of New Zealand or of, another country, or any jurisdiction of any country), rule of law, or contractual provision, or international treaty or protocol; or

        • “(B) enable a person who surrenders, retires, cancels, or otherwise uses it to claim an environmental benefit

    “greenhouse gas has the meaning set out in section 31 of the Climate Change Response Act 2002”.

    (2) The definition of investment security in section 16(1) is amended by repealing paragraph (a) and substituting the following paragraph:

    • “(a) means—

      • “(i) a writing (whether or not in the form of a security certificate) that is recognised in the place in which it is issued or dealt with as evidencing a futures contract, or a warrant or option or share, right to participate, or other interest in property or an enterprise, or that evidences an obligation of the issuer, and that, in the ordinary course of business, is transferred or withdrawn by—

        • “(A) delivery with any necessary endorsement, assignment, or registration in the records of the issuer or agent of the issuer, or by compliance with restrictions on transfer or withdrawal; or

        • “(B) an entry in the records of a clearing house or securities depository; or

        • “(C) an entry in the records maintained for that purpose by or on behalf of the issuer; or

        • “(D) an entry in the records maintained for that purpose by or on behalf of the nominee:

      • “(ii) emissions units; but”.

34 Meaning of “possession” in certain cases

  • (1) Section 18(1) is amended by inserting “, other than an emissions unit,” after “takes possession of an investment security”.

    (2) Section 18 is amended by inserting the following subsection after subsection (1):

    • “(1A) For the purposes of this Act, a person (person A) takes possession of an investment security that is an emissions unit if,—

      • “(a) in the case of an emissions unit that is evidenced by an emissions unit certificate, person A takes physical possession of that certificate:

      • “(b) in the case of an emissions unit that is, in the ordinary course of business, traded or settled through a clearing house or securities depository, the clearing house or securities depository, as the case may be, records the interest of person A in the emissions unit:

      • “(c) in the case of an emissions unit that is, in the ordinary course of business, held by a nominee, the records of the nominee record the interest of person A in the emissions unit:

      • “(d) in the case of an emissions unit that is a unit as defined in section 4(1) of the Climate Change Response Act 2002 and to which neither paragraph (b) nor (c) applies, the unit register established under section 18 of the Climate Change Response Act 2002 records person A as the possessor of the unit:

      • “(e) in the case of an emissions unit that is not a unit as defined in section 4(1) of the Climate Change Response Act 2002 and to which none of paragraphs (a), (b), or (c) apply, a person who is responsible for recording the holders of emissions units (whether by entry in a register or by any other means) records the interest of person A in the emissions unit.”

    (3) Section 18 is amended by adding the following subsection:

    • “(4) For the purposes of subsection (1A)(a), emissions unit certificate does not include a printed search result, or a copy of a printed search result, that purports to be issued by a registrar.”

Part 5
Securities Act 1978

35 Principal Act amended

  • This Part amends the Securities Act 1978.

36 Interpretation

  • (1) The definition of chattel in section 2(1) is amended by inserting “and emissions units” after “livestock”.

    (2) Section 2(1) is amended by inserting the following definitions in their appropriate alphabetical order:

    “emissions units means—

    • “(a) units as defined in section 4(1) of the Climate Change Response Act 2002; and

    • “(b) personal property that—

      • “(i) is created by, or in accordance with, any enactment (whether of New Zealand or of, another country, or any jurisdiction of any country), rule of law, or contractual provision, or international treaty or protocol as—

        • “(A) one of a fixed number of units issued by reference to a specified amount of greenhouse gas; or

        • “(B) evidence of a specified amount of reductions, removals, avoidance, storage, or sequestration, or any other form of mitigation of greenhouse gas emissions; and

      • “(ii) can be surrendered, retired, cancelled, or otherwise used to—

        • “(A) offset greenhouse gas emissions under, or otherwise comply with, any enactment (whether of New Zealand or of, another country, or any jurisdiction of any country), rule of law, or contractual provision, or international treaty or protocol; or

        • “(B) enable a person who surrenders, retires, cancels, or otherwise uses it to claim an environmental benefit

    “greenhouse gas has the meaning set out in section 31 of the Climate Change Response Act 2002”.

Schedule 1
Further amendments to principal Act

s 30

Section 2(1)

Definition of listed

Paragraph (b) of the definition of security

Definition of trading day

Section 4(3)
Section 6(1)(b)
Section 19D
Section 35G(a)
Section 35G(b)
Section 48E(2)(b)
Section 48E(2)(c)

Schedule 2
Amendments to other enactments

s 31

Part 1
Amendments to other Acts

Chateau Companies Act 1977 (1977 No 4)

Section 9(2)(e)

Companies Act 1993 (1993 No 105)

Section 61(7)(b)

Dairy Industry Restructuring Act 2001 (2001 No 51)

Section 102(3)(a)

Section 102(3)(b)

Mackelvie Trust Act 1958 (1958 No 2 (P))

Section 7(2)

Section 7(3)

Methodist Charitable and Educational Trusts Act 1911 (1911 No 1 (L))

Section 30(1)(f)

National Heart Foundation of New Zealand Empowering Act 1970 (1970 No 3 (P))

Section 3(1)

Port Companies Act 1988 (1988 No 91)

Section 13

Securities Markets Amendment Act 2002 (2002 No 44)

Section 32(2)

Securities Transfer Act 1991 (1991 No 119)

Definition of stock exchange's market in section 2

St John's College Trusts Act 1972 (1972 No 6 (P))

Section 11(1)(c)

Takeovers Act 1993 (1993 No 107)

Definition of quoted in section 2(1)

Definition of registered exchange's market in section 2(1)

Paragraph (a) of the definition of specified company in section 2(1)

Section 35(1)(b)

Section 35(3)(a)

Section 44V(c)

Wellington Methodist Charitable and Educational Trusts Act 1916 (1916 No 13 (L))

Section 31(1)(b)

Part 2
Amendments to regulations

Securities Markets (Market Manipulation) Regulations 2007 (SR 2007/373)

Definition of market in regulation 3(1)

Definition of securities in regulation 3(1)

Securities Regulations 1983 (SR 1983/121)

Definition of registered exchange's market in regulation 2(1)

Heading to regulation 23

Regulation 23(1)(a)

Takeovers Code Approval Order 2000 (SR 2000/210)

Paragraph (a) of the definition of code company in rule 3(1) of the Schedule

Definition of registered exchange's market in rule 3(1) of the Schedule

Rule 25(5)(c) of the Schedule

Rule 26(2)(c) of the Schedule

Rule 45(2) of the Schedule

Rule 46(a)(ii)(C) of the Schedule

Rule 51 of the Schedule

Paragraph (a) of the definition of annual report in clause 18(6) of Schedule 2 of the Schedule

Paragraph (a) of the definition of half-yearly report in clause 18(6) of Schedule 2 of the Schedule

Legislative history

2 September 2008Introduction (Bill 252–1)
23 September 2008First reading and referral to Commerce Committee