• Part 13 Part 13 Settlement Finality

    • 150. Introduction

      (1) This Part has effect for the purposes of safeguarding the operation of certain financial markets by provisions with respect to —
      (a) the insolvency, Winding-Up or Default of a person party to transactions in the market (sections 151 to 165);
      (b) the effectiveness or enforcement of certain Charges given to secure obligations in connection with such transactions (sections 167 to 169); and
      (c) rights and remedies in relation to certain property provided as cover for margin in relation to such transactions or as Default Fund Contributions, or subject to such a Charge (sections 170 to 174).
      (2) For the purposes of this Part, "notice" will be deemed to have been given if the person to whom the notice was given deliberately failed to make enquiries as to that matter in circumstances in which a reasonable and honest person would have done so. This does not apply for the purposes of a provision requiring actual notice or actual written notice.

    • Recognised Investment Exchanges and Recognised Clearing Houses

      • 151. Market Contracts

        (1) In relation to a Recognised Investment Exchange or a Remote Investment Exchange, this Part applies to —
        (a) contracts entered into by a member or Designated Non-Member of the Recognised Investment Exchange with a person other than the Recognised Investment Exchange which are either —
        (i) contracts made on the Recognised Investment Exchange or on a Recognised Investment Exchange to whose undertaking the Recognised Investment Exchange has succeeded whether by amalgamation, merger or otherwise; or
        (ii) contracts in the making of which the member or Designated Non-Member was subject to the rules of the Recognised Investment Exchange or of a Recognised Investment Exchange to whose undertaking the Recognised Investment Exchange has succeeded whether by amalgamation, merger or otherwise;
        (b) contracts entered into by the Recognised Investment Exchange or Remote Investment Exchange, in its capacity as such, with a member of the Recognised Investment Exchange or Remote Investment Exchange, or with a Recognised Clearing House, a Remote Clearing House or with another Recognised Investment Exchange or Remote Investment Exchange for the purpose of enabling the rights and liabilities of that member, Recognised Clearing House, Remote Clearing House or other Recognised Investment Exchange or Remote Investment Exchange under a transaction to be settled; and 
        (c) contracts entered into by the Recognised Investment Exchange or Remote Investment Exchange with a member of the Recognised Investment Exchange or Remote Investment Exchange, or with a Recognised Clearing House, a Remote Clearing House or with another Recognised Investment Exchange or Remote Investment Exchange for the purpose of providing Clearing Services to that member or Recognised Clearing House, Remote Clearing House, other Recognised Investment Exchange or other Remote Investment Exchange.
        (2) In relation to transactions which are cleared through a Recognised Clearing House or Remote Clearing House, this Part applies to —
        (a) Clearing Member House Contracts;
        (b) Clearing Member Client Contracts;
        (c) Client Trades, other than Client Trades excluded by subsections (3) or (4); and
        (d) contracts entered into by the Recognised Clearing House or Remote Clearing House with a member of the Recognised Clearing House or Remote Clearing House for the purpose of providing Clearing Services to that member or Recognised Body or Remote Body.
        (3) A Client Trade is excluded by this subsection from subsection (2)(c) if —
        (a) the Clearing Member which is a party to the Clearing Member Client Contract corresponding to the Client Trade Defaults; and
        (b) the Clearing Member Client Contract is not transferred to another Clearing Member within the period specified for this purpose in the Default Rules of the Recognised Clearing House or Remote Clearing House.
        (4) A Client Trade is also excluded by this subsection from subsection (2)(c) if —
        (a) the Client Trade was entered into by a Client in the course of providing Indirect Clearing Services to an Indirect Client;
        (b) the Client Defaults; and
        (c) the Clearing Member Client Contract corresponding to the Client Trade is not transferred within —
        (i) the period specified for this purpose in the Default Rules of the Recognised Clearing House or Remote Clearing House; or
        (ii) if no such period is specified in the Default Rules of the Recognised Clearing House or Remote Clearing House, a period of 14 days beginning with the day on which proceedings in respect of the Client's insolvency are begun.
        (5) The parties referred to in the definitions of "Clearing Member Client Contract" and "Client Trade" are —
        (a) a Clearing Member;
        (b) a Client; and
        (c) an Indirect Client.
        (6) The reference in subsection (4)(c)(ii) to the beginning of insolvency proceedings is to —
        (a) the presentation of a petition for Winding-Up;
        (b) the application for an administration order or the passing of a resolution for voluntary Winding-Up; or
        (c) the appointment of an Administrative Receiver.
        (7) In subsection (6)(b) the reference to an application for an administration order is to be taken to include a reference to —
        (a) in a case where an Administrator is appointed in accordance with Chapter 2 of Part 1 of the Insolvency Regulations 2015 following filing with the Court of a copy of a notice of intention to appoint under section 24 of those Regulations, the filing of the copy of the notice; and
        (b) in a case where an Administrator is appointed under that Part without a copy of a notice of intention to appoint having been filed with the Court, the appointment of the Administrator.

      • 152. Qualifying Collateral Arrangements and Qualifying Property Transfers

        (1) In relation to transactions which are cleared through a Recognised Clearing House, this Part applies to —
        (a) any contracts or contractual obligations for, or arising out of, the provision of Property as margin where —
        (i) the margin is provided to a Recognised Clearing House and is recorded in the accounts of the Recognised Clearing House as an asset held for the account of a Client, an Indirect Client, or a group of Clients or Indirect Clients; or
        (ii) the margin is provided to a Client or Clearing Member for the purpose of providing cover for exposures arising out of present or future Client Trades;
        (b) transfers of Property;
        (c) payments of money by a Clearing Member to Indirect Clients;
        (d) transfers of Property to the extent that they —
        (i) are made by a Recognised Clearing House to a Non-Defaulting Clearing Member instead of, or in place of, a Defaulting Clearing Member;
        (ii) represent the termination or close-out value of a Clearing Member Client Contract which is transferred from a Defaulting Clearing Member to a Non-Defaulting Clearing Member; and
        (iii) are determined in accordance with the Default Rules of the Recognised Clearing House; and
        (e) transfers of Property to the extent that such transfer —
        (i) is made by a Clearing Member to a Non-Defaulting Client or another Clearing Member instead of, or in place of, a Defaulting Client;
        (ii) represents the termination or close-out value of a Client Trade which is transferred from a Defaulting Client to another Clearing Member or a Non-Defaulting Client; and
        (iii) is of an amount that does not exceed the termination or close-out value of the Clearing Member Client Contract corresponding to that Client Trade, as determined in accordance with the Default Rules of the Recognised Clearing House.
        (2) For the purposes of subsection (1), Property —
        (a) has the meaning given to that term in section 215(2) of the Insolvency Regulations 2015; and
        (b) the reference to a contract or contractual obligation for, or arising out of, the provision of Property as margin in circumstances falling within that subsection includes a reference to a contract or contractual obligation of that kind which has been amended to reflect the transfer of a Clearing Member Client Contract or Client Trade

      • 153. Change in Default Rules

        (1) A Recognised Body shall give the Regulator at least one month's notice of any proposal to amend, revoke or add to its Default Rules and the Regulator may direct the Recognised Body not to proceed with the proposal, in whole or in part.
        (2) The Regulator may, if it considers it appropriate to do so, agree a shorter period of notice and, in a case where it does so, any Direction under this section must be given by it within that shorter period.
        (3) A Direction under this section may be varied or revoked.
        (4) Any amendment or revocation of, or addition to, the Default Rules of a Recognised Body in breach of a Direction under this section is ineffective.

      • 154. Modifications of the Insolvency Regulations 2015

        (1) The insolvency provisions outlined in the Insolvency Regulations 2015 have effect in relation to —
        (a) Market Contracts;
        (b) action taken under the rules of a Recognised Body or Remote Body with respect to Market Contracts;
        (c) action taken under the rules of a Recognised Clearing House or Remote Clearing House to transfer Clearing Member Client Contracts, or settle Clearing Member Client Contracts or Clearing Member House Contracts, in accordance with the Default Rules of the Recognised Clearing House or Remote Clearing House;
        (d) where Clearing Member Client Contracts transferred in accordance with the Default Rules of a Recognised Clearing House or Remote Clearing House were entered into by the Clearing Member or Client as a principal, action taken to transfer Client Trades, or groups of Client Trades, corresponding to those Clearing Member Client Contracts;
        (e) action taken to transfer Qualifying Collateral Arrangements in conjunction with a transfer of Clearing Member Client Contracts as mentioned in paragraph (c) or a transfer of Client Trades as mentioned in paragraph (d);
        (f) Qualifying Property Transfers;
        (g) a Collateral Security Arrangement;
        (h) orders for the delivery of Cash or non-Cash collateral to or from a Recognised Body or Remote Body which have become final and irrevocable under the rules of the Recognised Body or Remote Body; and
        (i) the Settlement or delivery of a product or security subject of a Market Contract following expiry or close-out of the Market Contract pursuant to the rules of a Recognised Body or Remote Body;
        subject to the provisions of this Part.
        (2) So far as those provisions relate to insolvency proceedings in respect of a person other than a Defaulter, they apply in relation to —
        (a) proceedings in respect of a Recognised Investment Exchange or Remote Investment Exchange or a member or Designated Non-Member of a Recognised Investment Exchange or Remote Investment Exchange;
        (b) proceedings in respect of a Recognised Clearing House or Remote Clearing House; and
        (c) proceedings in respect of a party to a Market Contract (other than solely a Client Trade) which are begun after a Recognised Body or Remote Body has taken action under its Default Rules in relation to a person party to the contract as principal;
        but not in relation to any other insolvency proceedings, notwithstanding that rights or liabilities arising from Market Contracts fall to be dealt with in the proceedings.
        (3) The reference in subsection (2)(c) to the beginning of insolvency proceedings is to —
        (a) the presentation of a petition for Winding-Up;
        (b) the application for an administration order or the passing of a resolution for voluntary Winding-Up; or
        (c) the appointment of an Administrative Receiver.
        (4) In subsection (3)(b) the reference to an application for an administration order shall be taken to include a reference to —
        (a) in a case where an Administrator is appointed in accordance with Chapter 2 of Part 1 of the Insolvency Regulations 2015 following filing with the Court of a copy of a notice of intention to appoint under section 24 of those Regulations, the filing of the copy of the notice; and
        (b) in a case where an Administrator is appointed under that Part without a copy of a notice of intention to appoint having been filed with the Court, the appointment of the Administrator.
        Amended 21 February 2018.

      • 155. Proceedings of Recognised Body take precedence over insolvency procedures

        (1) None of the following shall be regarded as to any extent invalid at law on the ground of inconsistency with the Insolvency Regulations 2015 relating to the distribution of the assets of a person on Winding-Up, or in the Administration of a Company or other body or in the Administration of an insolvent estate —
        (a) a Market Contract;
        (b) the Default Rules of a Recognised Body;
        (c) the rules of a Recognised Body as to the Settlement of Market Contracts not dealt with under its Default Rules;
        (d) the application, transfer or realisation of any Collateral Security Arrangements;
        (e) a transfer of a Clearing Member Client Contract, or the Settlement of a Clearing Member Client Contract or a Clearing Member House Contract, in accordance with the Default Rules of a Recognised Clearing House;
        (f) where a Clearing Member Client Contract transferred in accordance with the Default Rules of a Recognised Clearing House was entered into by the Clearing Member or Client as principal, a transfer of a Client Trade or group of Client Trades corresponding to that Clearing Member Client Contract;
        (g) a transfer of a Qualifying Collateral Arrangement in conjunction with the transfer of Clearing Member Client Contract as mentioned in paragraph (e) or of a Client Trade as mentioned in paragraph (f);
        (h) a Qualifying Property Transfer;
        (i) a Collateral Security Arrangement;
        (j) orders for the delivery of Cash or non-Cash collateral to or from a Recognised Body which have become final and irrevocable under the rules of the Recognised Body; and
        (k) the Settlement or delivery of a product or security subject of a Market Contract following expiry or close-out of the Market Contract pursuant to the rules of a Recognised Body;
        irrespective of the law applicable to the Market Contract or the Default Rules.
        (2) The powers of a Relevant Office-Holder in his capacity as such, and the powers of the Court under the Insolvency Regulations 2015 shall not be exercised in such a way as to prevent or interfere with —
        (a) any action taken under the Default Rules of a Recognised Body;
        (b) the Settlement in accordance with the rules of a Recognised Body of a Market Contract not dealt with under its Default Rules;
        (c) the transfer of a Clearing Member Client Contract, or the Settlement of a Clearing Member Client Contract or a Clearing Member House Contract, in accordance with the Default Rules of a Recognised Clearing House;
        (d) where a Clearing Member Client Contract transferred in accordance with the Default Rules of a Recognised Clearing House was entered into by the Clearing Member or Client as principal, the transfer of a Client Trade or group of Client Trades corresponding to that Clearing Member contract;
        (e) the transfer of a Qualifying Collateral Arrangement in conjunction with a transfer of a Clearing Member Client Contract as mentioned in paragraph (c), or a transfer of a Client Trade as mentioned in paragraph (d);
        (f) any action taken to give effect to any of the matters mentioned in paragraphs (c) to (e);
        (g) any action taken to give effect to a Qualifying Property Transfer;
        (h) a Collateral Security Arrangement;
        (i) orders for the delivery of Cash or non-Cash collateral to or from a Recognised Body which have become final and irrevocable under the rules of the Recognised Body; and
        (j) the Settlement or delivery of a product or security subject of a Market Contract following expiry or close-out of the Market Contract pursuant to the rules of a Recognised Body.
        This does not prevent a Relevant Office-Holder from afterwards seeking to recover any amount under sections 159(5) or 160(3) or prevent the Court from afterwards making any such order or decree as is mentioned in sections 161(1) (but subject to subsections (2) and (3) of that section).
        (3) Nothing in the following provisions of this Part shall be construed as affecting the generality of the above provisions.
        (4) A debt or other liability arising out of a Market Contract which is the subject of Default Proceedings may not be proved in a Winding-Up or bankruptcy or in the Administration of a Company or other body, until the completion of the Default Proceedings. A debt or other liability which by virtue of this subsection may not be proved or claimed shall not be taken into account for the purposes of any set off until the completion of the Default Proceedings.
        (5) However, prior to the completion of Default Proceedings —
        (a) where it appears to the chairman of the meeting of creditors that a sum will be certified under section 158(1) to be payable, subsection (4) shall not prevent any proof or claim including or consisting of an estimate of that sum which has been lodged from being admitted for the purpose only of determining the entitlement of a creditor to vote at a meeting of creditors; and
        (b) a creditor whose claim or proof has been lodged and admitted for the purpose of determining the entitlement of a creditor to vote at a meeting of creditors and which has not been subsequently wholly withdrawn, disallowed or rejected, is eligible as a creditor to be a member of a Liquidation Committee or, or in the Administration of a Company or other body a Creditors' Committee (both as defined in the Insolvency Regulations 2015).
        (6) For the purposes of subsections (4) and (5) the Default Proceedings shall be taken to be completed in relation to a person when a report is made under section 158 stating the sum (if any) certified to be due to or from him.

      • 156. Duty to give assistance for purposes of Default Proceedings

        (1) It is the duty of —
        (a) any person who has or had control of any assets of a Defaulter; and
        (b) any person who has or had control of any Documents of or relating to a Defaulter;
        to give a Recognised Body such assistance as it may reasonably require for the purposes of its Default Proceedings.

        This applies notwithstanding any duty of that person under the Insolvency Regulations 2015.
        (2) A person shall not under this section be required to provide any information or produce any Document which is deemed to be a Privileged Communication (as defined in the Insolvency Regulations 2015).
        (3) Where original Documents are supplied in pursuance of this section, the Recognised Body shall return them forthwith after the completion of the relevant Default Proceedings, and shall in the meantime allow reasonable access to them to the person by whom they were supplied and to any person who would be entitled to have access to them if they were still in the control of the person by whom they were supplied.
        (4) The expenses of a Relevant Office-Holder in giving assistance under this section are recoverable as part of the expenses incurred by him in the discharge of his duties and he shall not be required under this section to take any action which involves expenses which cannot be so recovered, unless the Recognised Body undertakes to meet them. There shall be treated as expenses its reasonable sums as it may determine in respect of time spent in giving the assistance and for the purpose of determining the priority in which its expenses are payable out of the assets, sums in respect of time spent shall be treated as his remuneration and other sums shall be treated as his disbursements.

      • 157. Supplementary provisions as to Default Proceedings

        (1) If the Court is satisfied on an application by a Relevant Office-Holder that a party to a Market Contract with a Defaulter intends to dissipate or apply his assets so as to prevent the Relevant Office-Holder recovering such sums as may become due upon the completion of the Default Proceedings, the Court may grant such interlocutory relief as it thinks fit.
        (2) A liquidator, Administrator or trustee of a Defaulter shall not —
        (a) declare or pay any dividend to the creditors; or
        (b) return any capital to contributories;
        unless he has retained what he reasonably considers to be an adequate reserve in respect of any claims arising as a result of the Default Proceedings of the Recognised Body concerned.
        (3) The Court may on an application by a Relevant Office-Holder make such order as it thinks fit altering or dispensing from compliance with such of the duties of his office as are affected by the fact that Default Proceedings are pending or could be taken, or have been or could have been taken.
        (4) Nothing in sections 42, 43, 44, 45 (including as applied by section 46), 193, or Article 20 of Chapter 3 of Schedule 10 of the Insolvency Regulations 2015 (all of which restrict the taking of certain legal proceedings and other steps), shall affect any action taken by a Recognised Body for the purpose of its Default Proceedings.

      • 158. Duty to report on completion of Default Proceedings

        (1) Subject to subsection (2), a Recognised Body shall, on the completion of proceedings under its Default Rules, report to the Regulator on its proceedings stating in respect of each creditor or debtor the sum or sums certified by them to be payable from or to the Defaulter or, as the case may be, the fact that no sum is payable.
        (2) A Non-Abu Dhabi Global Market Recognised Body shall not be subject to the obligation under subsection (1) unless it has been notified by the Regulator that a report is required for the purpose of insolvency proceedings in the Abu Dhabi Global Market.
        (3) The report under subsection (1) need not deal with a Market Contract which has been transferred in accordance with the Default Rules of a Recognised Clearing House.
        (4) The Recognised Body may make a single report or may make reports from time to time as proceedings are completed with respect to the transactions affecting particular persons.
        (5) The Recognised Body shall supply a copy of every report under this section to the Defaulter and to any Relevant Office-Holder acting in relation to him or his estate.
        (6) When a report under this section is received by the Regulator, it shall publish notice of that fact in such manner as it thinks appropriate for bringing the report to the attention of creditors and debtors of the Defaulter.
        (7) A Recognised Body shall make available for inspection by a creditor or debtor of the Defaulter so much of any report by it under this section as relates to the sum (if any) certified to be due to or from him or the method by which that sum was determined.
        (8) Any such person may require the Recognised Body, on payment of such reasonable fee as the Recognised Body may determine, to provide him with a copy of any part of a report which he is entitled to inspect.

      • 159. Net sum payable on completion of Default Proceedings

        (1) The following provisions apply with respect to a net sum certified by a Recognised Body under its Default Rules to be payable by or to a Defaulter.
        (2) Any net sum certified by a Recognised Body under its Default Rules shall be final and of declaratory effect, unless manifest error or fraud can be shown or any other subsection of this section provides otherwise.
        (3) If, in the Abu Dhabi Global Market, a petition for Winding-Up has been made, an administration order has been granted, or a resolution for voluntary Winding-Up has been passed, the debt —
        (a) is provable in the Winding-Up or Administration or, as the case may be, is payable to the Relevant Office-Holder; and
        (b) shall be taken into account, where appropriate, paragraph 24 of Schedule 5 of the Insolvency Regulations 2015 (Administration: mutual dealings and set-off) or the corresponding provision applicable in the case of Winding-Up or Administration;
        in the same way as a debt due before the commencement of the bankruptcy, the date on which the Body Corporate goes into liquidation (within the meaning of section 299(2) of the Insolvency Regulations 2015), or enters Administration or, in the case of a Limited Liability Partnership (as defined in the Insolvency Regulations 2015), the date of the Winding-Up order or the date on which the Limited Liability Partnership enters Administration.
        (4) In subsection (3), a reference to the making of an administration order shall be taken to include a reference to the appointment of an Administrator under —
        (a) section 21 of the Insolvency Regulations 2015 (Power to appoint); or
        (b) section 29 of the Insolvency Regulations 2015 (Power to appoint).
        (5) However, where (or to the extent that) a sum is taken into account by virtue of subsection (3)(b) which arises from a contract entered into at a time when the creditor had notice —
        (a) that a meeting of creditors had been summoned under section 171 of the Insolvency Regulations 2015 or that a Winding-Up petition was pending; or
        (b) that an application for an administration order was pending or that any person had given notice of intention to appoint an Administrator;
        the value of any profit to him arising from the sum being so taken into account (or being so taken into account to that extent) is recoverable from him by the Relevant Office-Holder unless the Court directs otherwise.
        (6) Subsection (5) does not apply in relation to a sum arising from a contract effected under the Default Rules of a Recognised Body.
        (7) Any sum recoverable by virtue of subsection (5) ranks for priority, in the event of the insolvency of the person from whom it is due, immediately before preferential debts.

      • 160. Disclaimer of property, rescission of contracts, etc.

        (1) Section 218 of the Insolvency Regulations 2015 (Power to disclaim onerous property) does not apply in relation to —
        (a) a Market Contract;
        (b) a Qualifying Collateral Arrangement;
        (c) a transfer of a Clearing Member Client Contract, a Client Trade or a Qualifying Collateral Arrangement, as mentioned in paragraphs (c) to (e) of section 154(1);
        (d) a Qualifying Property Transfer;
        (e) a contract effected by Recognised Body for the purpose of realising property provided as margin in relation to Market Contracts or as Default Fund Contribution;
        (f) a Collateral Security Arrangement;
        (g) orders for the delivery of Cash or non-Cash collateral to or from a Recognised Body which have become final and irrevocable under the rules of the Recognised Body; and
        (h) the Settlement or delivery of a product or security subject of a Market Contract following expiry or close-out of the Market Contract pursuant to the rules of a Recognised Body.
        (2) Section 209 (Consequences of a Winding-Up order) of the Insolvency Regulations 2015 does not apply to —
        (a) a Market Contract, or any disposition of property in pursuance of such a contract;
        (b) the provision of margin in relation to Market Contracts;
        (c) the provision of Default Fund Contribution to the Recognised Body;
        (d) a Qualifying Collateral Arrangement;
        (e) a transfer of a Clearing Member Client Contract, a Client Trade or a Qualifying Collateral Arrangement, as mentioned in paragraphs (c) to (e) of section 154(1);
        (f) a Qualifying Property Transfer;
        (g) a contract effected by the Recognised Body for the purpose of realising property provided as margin in relation to a Market Contract or as Default Fund Contribution, or any disposition of property in pursuance of such a contract;
        (h) any disposition of property in accordance with the rules of the Recognised Body as to the application of property provided as margin or as Default Fund Contribution;
        (i) a Collateral Security Arrangement;
        (j) orders for the delivery of Cash or non-Cash collateral to or from a Recognised Body which have become final and irrevocable under the rules of the Recognised Body; and
        (k) the Settlement or delivery of a product or security subject of a Market Contract following expiry or close-out of the Market Contract pursuant to the rules of a Recognised Body.
        (3) However, where —
        (a) a Market Contract is entered into by a person who has notice that a petition has been presented for the Winding-Up of the estate of the other party to the contract;
        (b) an order under section 154(1)(h) becomes irrevocable with respect to a person who has notice that a petition has been presented for the Winding-Up of the estate of another person affected by such order;
        (c) a product or security subject of a Market Contract under section 154(1)(i) becomes deliverable by or to a person who has notice that a petition has been presented for the Winding-Up of the estate of the other party to the dealing or contract; or
        (d) margin in relation to a Market Contract or Default Fund Contribution is accepted by a person who has notice that such a petition has been presented in relation to the person by whom or on whose behalf the margin or Default Fund Contribution is provided;
        the value of any profit to him arising from the contract or, as the case may be, the amount or value of the collateral to be transferred, deliverable, margin or Default Fund Contribution is recoverable from him by the Relevant Office-Holder unless the Court directs otherwise.
        (4) Subsection (3)(a) does not apply where the person entering into the contract is a Recognised Body acting in accordance with its rules, or where the contract or order is effected under the Default Rules of such a Recognised Body, but subsection (3)(d) applies in relation to the provision of —
        (a) a margin in relation to any such contract, unless the contract has been transferred in accordance with the Default Rules of the Recognised Clearing House;
        (b) a Default Fund Contribution;
        (c) a Collateral Security Arrangement;
        (d) orders for the delivery of Cash or non-Cash collateral to or from a Recognised Body which have become final and irrevocable under the rules of the Recognised Body; and
        (e) the Settlement or delivery of a product or security subject of a Market Contract following expiry or close-out of the Market Contract pursuant to the rules of a Recognised Body.
        (5) Any sum recoverable by virtue of subsection (3) ranks for priority, in the event of the insolvency of the person from whom it is due, immediately before preferential debts.

      • 161. Adjustment of prior transactions

        (1) No order shall be made in relation to a transaction to which this section applies under —
        (a) section 257 of the Insolvency Regulations 2015 (Transactions at an undervalue); or
        (b) section 258 of the Insolvency Regulations 2015 (Preferences).
        (2) This section applies to —
        (a) a Market Contract to which a Recognised Body is a party or which is entered into under its Default Rules; and
        (b) a disposition of property in pursuance of a Market Contract referred to in paragraph (a).
        (3) Where margin is provided in relation to a Market Contract and (by virtue of subsection (2)(a) or otherwise) no such order or decree as is mentioned in subsection (1) has been, or could be, made in relation to that contract, this section applies to —
        (a) the provision of the margin;
        (b) a Qualifying Collateral Arrangement;
        (c) any contract effected by the Recognised Body in question for the purpose of realising the property provided as margin; and
        (d) any disposition of property in accordance with the rules of the Recognised Body in question as to the application of property provided as margin.
        (4) This section also applies to —
        (a) the provision of Default Fund Contribution to a Recognised Body;
        (b) any contract effected by a Recognised Body for the purpose of realising the property provided as Default Fund Contribution;
        (c) any disposition of property in accordance with the rules of the Recognised Body as to the application of property provided as Default Fund Contribution;
        (d) a transfer of a Clearing Member Client Contract, a Client Trade or a Qualifying Collateral Arrangement as mentioned in paragraphs (c) to (e) of section 154(1); and
        (e) a Qualifying Property Transfer.

      • 162. Powers to give Directions

        (1) The powers conferred by this section are exercisable in relation to a Recognised Body.
        (2) Where in any case a Recognised Body has not taken action under its Default Rules —
        (a) if it appears to the Regulator that it could take action, the Regulator may direct it to do so; and
        (b) if it appears to the Regulator that it is proposing to take or may take action, the Regulator may direct it not to do so.
        (3) Before giving such a Direction the Regulator shall consult the Recognised Body in question, and it shall not give a Direction unless it is satisfied, in the light of that consultation —
        (a) in the case of a Direction to take action, that failure to take action would involve undue risk to investors or other participants in the market;
        (b) in the case of a Direction not to take action, that the taking of action would be premature or otherwise undesirable in the interests of investors or other participants in the market; or
        (c) in either case, that the Direction is necessary having regard to the public interest in the stability of the Abu Dhabi Global Market Financial System.
        (4) The Regulator may give a Direction to a Relevant Office-Holder appointed in respect of a Defaulting Clearing Member to take any action, or refrain from taking any action, if the Direction is given for the purposes of facilitating —
        (a) the transfer of a Clearing Member Client Contract, a Client Trade or a Qualifying Collateral Arrangement;
        (b) a Qualifying Property Transfer;
        (c) the settlement of a Collateral Security Arrangement;
        (d) orders for the delivery of Cash or non-Cash collateral to or from a Recognised Body which have become final and irrevocable under the rules of the Recognised Body; and
        (e) the Settlement or delivery of a product or security subject of a Market Contract following expiry or close-out of the Market Contract pursuant to the rules of a Recognised Body.
        (5) The Relevant Office-Holder to whom a Direction is given under subsection (4) —
        (a) must comply with the Direction notwithstanding any duty on the Relevant Office-Holder under the Insolvency Regulations 2015; but
        (b) is not required to comply with the Direction given if the value of the Clearing Member's estate is unlikely to be sufficient to meet the Relevant Office-Holder's reasonable expenses of complying.
        (6) The expenses of the Relevant Office-Holder in complying with a Direction of the Regulator under subsection (4) are recoverable as part of the expenses incurred in the discharge of the Relevant Office-Holder's duties.
        (7) A Direction shall specify the grounds on which it is given.
        (8) A Direction not to take action may be expressed to have effect until the giving of a further Direction (which may be a Direction to take action or simply revoking the earlier Direction).
        (9) No Direction shall be given not to take action if, in relation to the person in question —
        (a) a Winding-Up order has been made; or
        (b) a resolution for voluntary winding up has been passed or an Administrator, Administrative Receiver or provisional liquidator has been appointed;
        and any previous Direction not to take action shall cease to have effect on the making or passing of any such order, award or appointment.
        (10) Where a Recognised Body has taken or been directed to take action under its Default Rules, the Regulator may direct it to do or not to do such things (being things which it has power to do under its Default Rules) as are specified in the Direction.
        (11) Where the Recognised Body is acting in accordance with a Direction under subsection (2)(a) that was given only by virtue of subsection (3)(a), the Regulator shall not give a Direction under subsection (10) unless it is satisfied that the Direction under that subsection will not impede or frustrate the proper and efficient conduct of the Default Proceedings.
        (12) Where the Recognised Body has taken action under its Default Rules without being directed to do so, the Regulator shall not give a Direction under subsection (10) unless —
        (a) it is satisfied that the Direction under that subsection will not impede or frustrate the proper and efficient conduct of the Default Proceedings; or
        (b) it is satisfied that the Direction is necessary having regard to the public interest in the stability of the Abu Dhabi Global Market Financial System.
        (13) A Direction under this section is enforceable, on the application of the Regulator, by injunction, and where a Recognised Body or a Relevant Office-Holder has not complied with a Direction, the Court may make such order as it thinks fit for restoring the position to what it would have been if the Direction had been complied with.

      • 163. Application to determine whether Default Proceedings to be taken

        (1) This section applies where a Relevant Insolvency Event has occurred in the case of —
        (a) a Recognised Investment Exchange or a member or Designated Non-Member of a Recognised Investment Exchange;
        (b) a Recognised Clearing House or a member of a Recognised Clearing House; or
        (c) a Client which is providing Indirect Clearing Services to an Indirect Client.
        The Recognised Investment Exchange, member, Designated Non-Member, Recognised Clearing House or Client in whose case a Relevant Insolvency Event has occurred is referred to below as the "Person in Default".
        (2) For the purposes of this section a "Relevant Insolvency Event" occurs where —
        (a) a Winding-Up order is made;
        (b) an administration order is made;
        (c) an Administrator is appointed under section 21 of the Insolvency Regulations 2015 (Power to appoint) or under section 29 of the Insolvency Regulations 2015 (Power to appoint);
        (d) a resolution for voluntary Winding-Up is passed; or
        (e) an order appointing a provisional liquidator is made.
        (3) Where in relation to a person in default a Recognised Body (the "Responsible Recognised Body") —
        (a) has power under its Default Rules to take action in consequence of the Relevant Insolvency Event or the matters giving rise to it; but
        (b) has not done so;
        a Relevant Office-Holder appointed in connection with or in consequence of the Relevant Insolvency Event may apply to the Regulator.
        (4) The application shall specify the Responsible Recognised Body and the grounds on which it is made.
        (5) On receipt of the application the Regulator shall notify the Responsible Recognised Body, and unless within three Business Days after the day on which the notice is received the Responsible Recognised Body —
        (a) takes action under its Default Rules; or
        (b) notifies the Regulator that it proposes to do so forthwith;
        then, subject as follows, the provisions of sections 154 to 161 do not apply in relation to Market Contracts to which the Person in Default is a party or to anything done by the Responsible Recognised Body for the purposes of, or in connection with, the Settlement of any such contract.
        (6) The provisions of sections 154 to 161 are not disapplied if before the end of the period mentioned in subsection (5) the Regulator gives the Responsible Recognised Body a Direction under section 162(2)(a). No such Direction may be given after the end of that period.
        (7) If the Responsible Recognised Body notifies the Regulator that it proposes to take action under its Default Rules forthwith, it shall do so, and that duty is enforceable, on the application of the Regulator, by injunction.

      • 164. Supplementary provisions

        (1) Sections 132 and 134 apply in relation to a failure by a Recognised Body to comply with an obligation under this Part as to a failure to comply with an obligation under those sections.
        (2) Where the recognition of a Recognised Body is revoked under section 134, the Regulator may, before or after the Revocation Order, give such Directions as it thinks fit with respect to the continued application of the provisions of this Part, with such exceptions, additions and adaptations as may be specified in the Direction, in relation to cases where a relevant event of any description specified in the Directions occurred before the Revocation Order takes effect.
        (3) Part 21 may make provision in relation to a notice, Direction or other Document required or authorised by or under this Part to be given to or served on any person other than the Regulator.

      • 165. Certain Non-Abu Dhabi Global Market Clearing Houses and Non-Abu Dhabi Global Market Investment Exchanges

        (1) This Part applies to transactions cleared through a Non-Abu Dhabi Global Market Clearing House by a Clearing Member or a Client as it applies to transactions cleared through a Recognised Clearing House, but subject to the modifications in subsections (2) and (3).
        (2) The Regulator shall not approve a Non-Abu Dhabi Global Market Clearing House unless it is satisfied —
        (a) that the rules and practices of the body, together with the law of the country in which the body's head office is situated, provide adequate procedures for dealing with the default of persons party to contracts connected with the body; and
        (b) that it is otherwise appropriate to approve the body.
        (3) The reference in subsection (2)(a) to default is to a person being unable to meet his obligations.
        (4) A Non-Abu Dhabi Global Market Clearing House may apply to the Regulator for an order recognising that the Relevant Provisions of its Default Rules satisfy the Relevant Requirements.
        (5) The Application must be made in such manner, and must be accompanied by such information, Documents and reports, as the Regulator may direct.
        (6) Information, Documents and reports required under subsection (5) must be provided in English and be given at such times, in such form and at such place, and verified in such manner, as the Regulator may direct.
        (7) The Regulator may make an order recognising that the Relevant Provisions of the Default Rules satisfy the Relevant Requirements.
        (8) The Regulator may by order revoke an order made under subsection (7) if —
        (a) the Non-Abu Dhabi Global Market Clearing House consents;
        (b) the Non-Abu Dhabi Global Market Clearing House has failed to pay a fee which is owing to the Regulator in accordance with Rules made under section 7(8);
        (c) the Non-Abu Dhabi Global Market Clearing House is failing or has failed to comply with a requirement of or imposed under section 153 (as modified by section 166); or
        (d) it appears to the Regulator that the Relevant Provisions no longer satisfy the Relevant Requirements.
        (9) An order made under subsection (7) or (8) must state the time and date when it is to have effect.
        (10) An order made under subsection (8) may contain such transitional provision as the Regulator considers appropriate.
        (11) The Regulator must —
        (a) maintain a register of orders made under subsection (7) which are in force; and
        (b) publish the register in such manner as it appears to the Regulator to be appropriate.
        (12) Section 135 applies to a refusal to make an order under subsection (7) or the making of a revocation order under subsection (8)(b), (c) or (d) as it applies to the making of a Revocation Order under section 134, but with the following modifications —
        (a) for "Recognised Body" substitute "Non-Abu Dhabi Global Market Clearing House"; and
        (b) in sections 135(6) and (7), for "give a Direction under section 132 or 133" substitute "make an order under section 165(8)".
        (13) If the Regulator refuses to make an order under subsection (7) or makes an order under subsection (8)(b), (c) or (d), the Non-Abu Dhabi Global Market Clearing House may refer the matter for review by the Regulatory Committee.
        (14) The Regulator may rely on information or advice from a Non-Global Market Competent Authority in its determination of an Application under subsection (4) or the making of a Revocation Order under subsection (8)(d).

      • 166. Change in Default Rules

        (1) A Non-Abu Dhabi Global Market Recognised Clearing House in respect of which an order under section 165(7) has been made and not revoked must give the Regulator at least one month's notice of any proposal to amend, revoke or add to its Default Rules.
        (2) The Regulator may, if it considers it appropriate to do so, agree a shorter period of notice.
        (3) Where notice is given to the Regulator under subsection (1), a Non-Abu Dhabi Global Market Recognised Clearing House must provide the Regulator with such information, Documents and reports as the Regulator may require.
        (4) Information, Documents and reports required under subsection (3) must be provided in English and be given at such times, in such form and at such place, and verified in such a manner, as the Regulator may direct.
        (5) Section 158 does not apply to a Non-Abu Dhabi Global Market Recognised Clearing House unless it has been notified by the Regulator that a report under that section is required for the purposes of insolvency proceedings in the Court.
        (6) In relation to a Non-Abu Dhabi Global Market Recognised Clearing House, references in this Part to the "rules" or "Default Rules" of the Recognised Clearing House are to be taken not to include references to any Relevant Provisions unless —
        (a) the Relevant Provisions satisfy the Relevant Requirements; or
        (b) the Regulator has made an order under section 165(7) recognising that the Relevant Provisions of its Default Rules satisfy the Relevant Requirements and the order has not been revoked.

    • Collateral Security Arrangements

      • 167. Collateral Security Arrangements

        (1) In this Part "Collateral Security Arrangements" means any realisable assets provided under a Charge, whether fixed or floating, or a repurchase or similar agreement or otherwise (including money provided under a Charge), granted —
        (a) in favour of a Recognised Investment Exchange, for the purpose of securing debts or liabilities arising in connection with the Settlement of Market Contracts;
        (b) in favour of a Recognised Clearing House, for the purpose of securing debts or liabilities arising in connection with their ensuring the performance of Market Contracts;
        (c) to a central bank for the purpose of security rights and obligations in connection with its operations in carrying out its function as a central bank; or
        (d) in favour of a person who agrees to make payments as a result of the transfer or allotment of specified Financial Instruments or payments made through the medium of a computer based system established by the Regulator, for the purpose of securing debts or liabilities of the transferee or allottee arising in connection therewith.
        (2) Where a Charge is granted partly for purposes specified in subsections (1)(a), (b) or (d) and partly for other purposes, it is a "Collateral Security Arrangement" so far as it has effect for the specified purposes.

      • 168. Administration orders

        (1) The insolvency provisions outlined in the Insolvency Regulations 2015 have effect in relation to Collateral Security Arrangements and action taken in enforcing them subject to the provisions of this section.
        (2) The following provisions of Part 1 of the Insolvency Regulations 2015 do not apply in relation to a Collateral Security Arrangement —
        (a) section 46 (Interim moratorium); and
        (b) section 101 (Hire-purchase property).
        (3) Section 159 of the Insolvency Regulations (Vacation of office) does not apply to a receiver appointed under a Collateral Security Arrangement.
        (4) However, where a Collateral Security Arrangement falls to be enforced after the occurrence of an event to which subsection (5) applies, and there exists another Charge over some or all of the same property ranking in priority to or pari passu with the Collateral Security Arrangement, on the application of any person interested the Court may order that there shall be taken after enforcement of the Collateral Security Arrangement such steps as the Court may direct for the purpose of ensuring that the chargee under the other Charge is not prejudiced by the enforcement of the Collateral Security Arrangement.
        (5) This subsection applies to —
        (a) making an Administration application under section 8 of the Insolvency Regulations 2015; and
        (b) filing with the Court a copy of notice of intention to appoint an Administrator under Chapter 4 of Part 1 of the Insolvency Regulations 2015.
        (6) Section 170 of the Insolvency Regulations 2015 (Power to dispose of charged property) does not apply in relation to a Collateral Security Arrangement.
        (7) Section 209 of the Insolvency Regulations 2015 (Consequences of Winding-Up order) does not apply to a disposition of property as a result of which the property becomes subject to a Collateral Security Arrangement or any transaction pursuant to which that disposition is made.
        (8) However, if a person who is party to a disposition mentioned in subsection (7) has notice at the time of the disposition that a petition has been presented for the Winding-Up or bankruptcy of the estate of the party making the disposition, the value of any profit to him arising from the disposition is recoverable from him by the Relevant Office-Holder unless —
        (a) the person is a chargee under the Collateral Security Arrangement;
        (b) the disposition is made in accordance with the Default Rules of a Recognised Clearing House for the purposes of transferring a position or Asset of a Clearing Member in Default; or
        (c) the Court directs otherwise.
        (9) Any sum recoverable by virtue of subsection (8) ranks for priority, in the event of the insolvency of the person from whom it is due, immediately before preferential debts.
        (10) In a case falling within both subsection (7) (as a disposition of property as a result of which the property becomes subject to a Collateral Security Arrangement) and section 160(2) (as the provision of margin in relation to a Market Contract), section 160(3) applies with respect to the recovery of the amount or value of the margin and subsection (8) does not apply.

      • 169. Power to make provision about certain other Charges

        (1) The Regulator may by Rules provide that the Insolvency Regulations 2015 have effect in relation to Charges of such descriptions as may be Specified, and action taken in enforcing them, subject to such provisions as may be Specified.
        (2) The Rules may specify any description of Charge granted in favour of —
        (a) a body approved under section 165;
        (b) the Regulator;
        (c) a person who has a Financial Services Permission to carry on a Regulated Activity of a description specified in the Rules; or
        (d) an international securities self-regulating organisation approved for the purposes of an order made under these Regulations;
        for the purpose of securing debts or liabilities arising in connection with or as a result of the settlement of contracts or the transfer of assets, rights or interests on a financial market.
        (3) The Rules may specify any description of Charge granted for that purpose in favour of any other person in connection with exchange facilities or Clearing Services provided by a Recognised Body or by any such body, person, authority or organisation as is mentioned in subsection (2).
        (4) Where a Charge is granted partly for the purpose specified in subsection (2) and partly for other purposes, the power conferred by this section is exercisable in relation to the Charge so far as it has effect for that purpose.
        (5) The Rules may —
        (a) make the same or similar provision in relation to the Charges to which they apply as is made by or under sections 179(1)(h) and 168 in relation to Collateral Security Arrangements; or
        (b) apply any of those provisions with such exceptions, additions or adaptations as are specified in the Rules.
        (6) Rules under this section may provide that they apply or do not apply to a Charge if or to the extent that it secures obligations of a Specified description, is a Charge over property of a Specified description or contains provisions of a Specified description.

    • Market property

      • 170. Application of margin or Default Fund Contribution not affected by certain other interests

        (1) The following provisions have effect with respect to the application by a Recognised Body of property (other than Real Property) held by the Recognised Body as margin in relation to a Market Contract or as Default Fund Contribution.
        (2) So far as necessary to enable the property to be applied in accordance with the rules of the Recognised Body, it may be so applied notwithstanding any prior equitable interest or right, or any right or remedy arising from a breach of fiduciary duty, unless the Recognised Body had received actual written notice of the interest, right or breach of duty at the time the property was provided as margin or as Default Fund Contribution. In order to be valid, any notice under this subsection may only be delivered to the Recognised Body by one of its members and must be delivered in accordance with or in order to satisfy applicable Rules made by the Regulator on Client Money in accordance with section 4, or similar rules in any non-Abu Dhabi Global Market jurisdiction.
        (3) No right or remedy arising subsequently to the property being provided as margin or as Default Fund Contribution may be enforced so as to prevent or interfere with the application of the property by the Recognised Body in accordance with its rules.
        (4) Where a Recognised Body has power by virtue of the above provisions to apply property notwithstanding an interest, right or remedy, a person to whom the exchange or clearing house disposes of the property in accordance with its rules takes free from that interest, right or remedy.
        (5) The records and accounts of a Recognised Body detailing the Clearing Member House Contracts, Clearing Member Client Contracts, relevant Client Trades and the corresponding property provided by way of margin with respect to each such category of Market Contract, shall be final and definitive in relation to the rights of the Recognised Body to take action under its Default Rules, including applying property or its proceeds against liabilities or aggregating property or its proceeds with amounts in either case recorded in particular accounts, which may take place notwithstanding any prior or competing equitable interest or right, or any right or remedy arising from a breach of fiduciary duty on the part of any Clearing Member, Client or other party, whether relevant to a Market Contract or any corresponding property provided by way of margin, excepting only cases of actual written notice referred to in subsection (2).

      • 171. Priority of floating Collateral Security Arrangement over subsequent Charges

        (1) The Regulator may by Rules provide that a Collateral Security Arrangement which is a floating Charge has priority over a Charge subsequently created or arising, including a fixed Charge.
        (2) The Rules may make different provision for cases defined, as regards the Collateral Security Arrangement or the subsequent Charge, by reference to the description of Charge, its terms, the circumstances in which it is created or arises, the nature of the Charge, the person in favour of whom it is granted or arises or any other relevant factor.

      • 172. Priority of Collateral Security Arrangement over unpaid vendor's lien

        Where property subject to an unpaid vendor's lien becomes subject to a Collateral Security Arrangement, the Charge has priority over the lien unless the chargee had actual notice of the lien at the time the property became subject to the Charge.

      • 173. Proceedings against market property by unsecured creditors

        (1) Where property (other than Real Property) is held by a Recognised Body as margin in relation to Market Contracts or as Default Fund Contribution, or is subject to a Collateral Security Arrangement, no execution or other legal process for the enforcement of a judgment or order may be commenced or continued, and no distress may be levied against the property by a person not seeking to enforce any interest in or security over the property, except with the consent of —
        (a) in the case of property provided as cover for margin or as Default Fund Contribution, the Recognised Body in question; or
        (b) in the case of property subject to a Collateral Security Arrangement, the person in whose favour the Charge was granted.
        (2) Where consent is given the proceedings may be commenced or continued notwithstanding any provision of the Insolvency Regulations 2015.
        (3) Where by virtue of this section a person would not be entitled to enforce a judgment or order against any property, any injunction or other remedy granted with a view to facilitating the enforcement of any such judgment or order shall not extend to that property.

      • 174. Power to apply provisions to other cases

        (1) A power to which this subsection applies includes the power to apply sections 170 to 173 to any description of property provided as cover for margin in relation to contracts in relation to which the power is exercised or, as the case may be, property subject to Charges in relation to which the power is exercised.
        (2) The Rules may provide that those sections apply with such exceptions, additions and adaptations as may be specified in the Rules.
        (3) Subsection (1) applies to the powers of the Regulator under sections 165, 169 and 179(1)(c).

      • 175. Recognised Clearing Houses: disapplication of provisions on mutual credit and set off

        (1) Nothing in the Insolvency Regulations 2015 shall enable the setting off against each other of —
        (a) positions and assets recorded in an account at a Recognised Clearing House and held for the account of a Client, an Indirect Client or a group of Clients or Indirect Clients; and
        (b) positions and assets recorded in any other account at the Recognised Clearing House.
        (2) Nothing in the Insolvency Regulations 2015 shall enable the setting off against each other of —
        (a) positions and assets recorded in an account at a Clearing Member and held for the account of an Indirect Client or a group of Indirect Clients; and
        (b) positions and assets recorded in any other account at the Clearing Member.

      • 176. Insolvency proceedings in other jurisdictions

        (1) The references to insolvency law in the Insolvency Regulations 2015 include, in relation to a part of the Abu Dhabi Global Market, the provisions made by or under this Part and, in relation to another country or territory other than Abu Dhabi Global Market, so much of the law of that country or territory as corresponds to any provisions made by or under this Part.
        (2) A court shall not, in pursuance of that section or any other enactment or rule of law, recognise or give effect to —
        (a) any order of a court exercising jurisdiction in relation to insolvency law in a country or territory outside the Abu Dhabi Global Market; or
        (b) any act of a person appointed in such a country or territory to discharge any functions under insolvency law;
        in so far as the making of the order or the doing of the act would be prohibited in the case of the Court in the Abu Dhabi Global Market or a Relevant Office-Holder by provisions made by or under this Part.

      • 177. Indemnity for certain acts

        (1) Where a Relevant Office-Holder takes any action in relation to property of a Defaulter which is liable to be dealt with in accordance with the Default Rules of a Recognised Body, and believes and has reasonable grounds for believing that he is entitled to take that action, he is not liable to any person in respect of any loss or damage resulting from his action except in so far as the loss or damage is caused by the Relevant Office-Holder's own negligence.
        (2) Any failure by a Recognised Body to comply with its own rules in respect of any matter shall not prevent that matter being treated for the purposes of this Part as done in accordance with those rules so long as the failure does not substantially affect the rights of any person entitled to require compliance with the rules.
        (3) No Recognised Body, nor any officer or servant or member of the governing body of a Recognised Body, shall be liable in damages for anything done or omitted in the discharge or purported discharge of any functions to which this subsection applies unless the act or omission is shown to have been in bad faith.
        (4) The functions to which subsection (3) applies are the functions of the Recognised Body so far as relating to, or to matters arising out of —
        (a) its Default Rules; or
        (b) any obligations to which it is subject by virtue of this Part.
        (5) No person to whom the exercise of any function of a Recognised Body is delegated under its Default Rules, nor any officer or servant of such a person, shall be liable in damages for anything done or omitted in the discharge or purported discharge of those functions unless the act or omission is shown to have been in bad faith.

      • 178. Action taken under Default Rules

        (1) For the purposes of the definition of "Defaulter", where a Recognised Clearing House takes action under the rules referred to in the definition of "Default Rules", the action is to be treated as taken in respect of the Client providing the Indirect Clearing Services.
        (2) If a Recognised Body takes action under its Default Rules in respect of a person, all subsequent proceedings under its rules for the purposes of or in connection with the Settlement of Market Contracts to which the Defaulter is a party shall be treated as done under its Default Rules.

      • 179. Power of the Regulator to make Rules under this Part

        (1) The Regulator may by Rules, in accordance with the procedure in Part 2, make further provision as to —
        (a) the duties of persons to give assistance to a Recognised Body for the purposes of its Default Proceedings, and the duties of the Recognised Body with respect to information supplied to it;
        (b) the Charges granted in favour of any such person as is mentioned in sections 167(1)(a), (b) or (d) which are to be treated as "Collateral Security Arrangements" for the purposes of this Part, where the Regulator may —
        (i) add, amend or repeal the provisions of sections 167(1) or (2); and
        (ii) provide that a Charge shall or shall not be treated as a Collateral Security Arrangement if or to the extent that it secures obligations of a specified description, is a Charge over property of a specified description or contains provisions of a specified description;
        (c) the application of this Part to contracts of any specified description in relation to which settlement arrangements are provided by the Regulator, as it applies to contracts connected with a Recognised Body;
        (d) the effect of the Insolvency Regulations 2015 on specific Charges, in accordance with section 169;
        (e) the application of these Regulations to a Non-Abu Dhabi Global Market Recognised Body approved in accordance with section 165, together with exceptions, additions and adaptations as deemed necessary;
        (f) the priority of a Collateral Security Arrangement which is a floating Charge, in accordance with section 171;
        (g) the application of this Part to contracts connected with a Non-Abu Dhabi Global Market Clearing House or Non-Abu Dhabi Global Market Investment Exchange which —
        (i) is not a Non- Abu Dhabi Global Market Recognised Body; but
        (ii) is approved by the Regulator in accordance with such requirements as may be so specified;
        (h) modifications to the Insolvency Regulations 2015 relating to Collateral Security Arrangements and action taken in enforcing them, where such Rules may make different provision for cases defined by reference to the nature of the Charge, the nature of the property subject to it, the circumstances, nature or extent of the obligations secured by it or any other relevant factor; and
        (i) such further provision as appears to the Regulator to be necessary or expedient for the purposes of this Part.
        (2) Rules made in accordance with this Part may add to, amend or repeal any of the provisions of this Part or provide that those provisions have effect subject to such additions, exceptions or adaptations as are specified in the Rules.