§ 79 — Certificate of restructuring of share capital

79.—(1) If the Minister approves a determination, the Minister must, as soon as practicable, issue a certificate of restructuring of share capital, which comes into effect on the date specified by the Minister in the certificate.(2) The certificate must specify such information as may be prescribed by regulations made under section 135.

(3) The certificate may make provision for all or any of the following matters:(a)

the cancellation of the whole or any part of the share capital of the pertinent financial institution not paid up;

(b)

the cancellation of the whole or any part of the paid‑up share capital of the pertinent financial institution which is lost or not represented by the available assets of the pertinent financial institution;

(c)

the shares to be issued by the pertinent financial institution to the subscriber, the consideration, if any, to be paid by the subscriber for the shares and the period within which the consideration is to be paid;

(d)

such incidental, consequential and supplementary matters as are, in the Minister’s opinion, necessary to secure that the restructuring of share capital is fully effective, including conditions relating to the restructuring of share capital.

(4) The Minister may at any time before the certificate comes into effect add to, vary or revoke any matter specified in the certificate.

(5) On or before the date on which the certificate comes into effect, the Authority must cause the certificate and any addition, variation or revocation referred to in subsection (4) to be —(a)

served on the pertinent financial institution; and

(b)

published in the Gazette and in such newspaper or newspapers as the Minister may determine.

(6) Despite any written law or rule of law, or anything in the memorandum and articles of association of the pertinent financial institution, upon the certificate coming into effect —(a)

where the certificate provides for a reduction of the share capital of the pertinent financial institution —(i)

the reduction of the share capital takes effect without other or further act by the pertinent financial institution; and

(ii)

the certificate has effect according to its tenor and is binding on any person thereby affected; or

(b)

where the certificate provides for the issue of shares by the pertinent financial institution —(i)

the pertinent financial institution must issue the shares in accordance with the certificate; and

(ii)

the certificate has effect according to its tenor and is binding on any person thereby affected.

(7) Where the issue of shares under the certificate results in the subscriber becoming a significant shareholder of the pertinent financial institution, upon the coming into effect of the certificate, the subscriber —(a)

is treated as having obtained the approval of the Minister or the Authority (as the case may be) under the significant shareholder provisions applicable to the pertinent financial institution, in respect of the shares; and

(b)

is not required to make a take-over offer or to acquire the shares of the other shareholders of the pertinent financial institution, despite the provisions of the Companies Act 1967 or the Take‑over Code.

(8) The pertinent financial institution must lodge a copy of the certificate with the Registrar of Companies within 7 days after being served the certificate.

(9) A pertinent financial institution that or a subscriber who fails to comply with any provision in the certificate shall be guilty of an offence and shall be liable on conviction —(a)

in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or

(b)

in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction.

(10) Where a person is charged with an offence under subsection (9), it is a defence for the person to prove that —(a)

the person was not aware that the person had contravened any provision in the certificate; and

(b)

the person has complied with the provision within a reasonable time after becoming aware of the contravention.

(11) Except as provided in subsection (10), it is not a defence for a person charged with an offence under subsection (9) that the person did not intend to or did not knowingly contravene any provision in the certificate.

(12) A pertinent financial institution that contravenes subsection (8), and every officer of the pertinent financial institution who fails to take all reasonable steps to secure compliance by the pertinent financial institution with that subsection, shall each be guilty of an offence and shall each be liable on conviction to a fine not exceeding $2,000 and, in the case of a continuing offence, to a further fine not exceeding $200 for every day or part of a day during which the offence continues after conviction.

(13) Despite section 62(2) but subject to section 134, during the period beginning on the date on which the Minister publishes the notice under section 78(7) in the Gazette on the restructuring of the share capital of a pertinent financial institution or (where the notice is not published in the Gazette) the date on which the Authority publishes the certificate under subsection (5) in the Gazette on the restructuring of the share capital, and ending on the date on which the certificate comes into effect —(a)

no resolution may be passed, and no order may be made, for the winding up of the pertinent financial institution;

(b)

no judicial manager may be appointed under Part 7 of the Insolvency, Restructuring and Dissolution Act 2018 in relation to the pertinent financial institution;

(c)

no proceedings may be commenced or continued against the pertinent financial institution in respect of any business of the pertinent financial institution;

(d)

no enforcement order, distress or other legal process may be commenced, levied or continued against any property of the pertinent financial institution;

(e)

no steps may be taken to enforce any security over any property of the pertinent financial institution; and

(f)

any sale, transfer, assignment or other disposition of any property of the pertinent financial institution is void, except for (where the pertinent financial institution is an insurer licensed under the Insurance Act 1966) any payment of claims to policy owners or claimants, other than policy owners who are related corporations of the pertinent financial institution.

(14) In subsection (12), “officer”, in relation to a pertinent financial institution, includes —(a)

a director, a secretary or an executive officer of the pertinent financial institution;

(b)

a receiver or manager of any part of the undertaking of the pertinent financial institution appointed under a power contained in any instrument; and

(c)

a liquidator of the pertinent financial institution appointed in a voluntary winding up.

—(1) If the Minister approves a determination, the Minister must, as soon as practicable, issue a certificate of restructuring of share capital, which comes into effect on the date specified by the Minister in the certificate.

(2) The certificate must specify such information as may be prescribed by regulations made under section 135.

(3) The certificate may make provision for all or any of the following matters:(a)

the cancellation of the whole or any part of the share capital of the pertinent financial institution not paid up;

(b)

the cancellation of the whole or any part of the paid‑up share capital of the pertinent financial institution which is lost or not represented by the available assets of the pertinent financial institution;

(c)

the shares to be issued by the pertinent financial institution to the subscriber, the consideration, if any, to be paid by the subscriber for the shares and the period within which the consideration is to be paid;

(d)

such incidental, consequential and supplementary matters as are, in the Minister’s opinion, necessary to secure that the restructuring of share capital is fully effective, including conditions relating to the restructuring of share capital.

(4) The Minister may at any time before the certificate comes into effect add to, vary or revoke any matter specified in the certificate.

(5) On or before the date on which the certificate comes into effect, the Authority must cause the certificate and any addition, variation or revocation referred to in subsection (4) to be —(a)

served on the pertinent financial institution; and

(b)

published in the Gazette and in such newspaper or newspapers as the Minister may determine.

(6) Despite any written law or rule of law, or anything in the memorandum and articles of association of the pertinent financial institution, upon the certificate coming into effect —(a)

where the certificate provides for a reduction of the share capital of the pertinent financial institution —(i)

the reduction of the share capital takes effect without other or further act by the pertinent financial institution; and

(ii)

the certificate has effect according to its tenor and is binding on any person thereby affected; or

(b)

where the certificate provides for the issue of shares by the pertinent financial institution —(i)

the pertinent financial institution must issue the shares in accordance with the certificate; and

(ii)

the certificate has effect according to its tenor and is binding on any person thereby affected.

(7) Where the issue of shares under the certificate results in the subscriber becoming a significant shareholder of the pertinent financial institution, upon the coming into effect of the certificate, the subscriber —(a)

is treated as having obtained the approval of the Minister or the Authority (as the case may be) under the significant shareholder provisions applicable to the pertinent financial institution, in respect of the shares; and

(b)

is not required to make a take-over offer or to acquire the shares of the other shareholders of the pertinent financial institution, despite the provisions of the Companies Act 1967 or the Take‑over Code.

(8) The pertinent financial institution must lodge a copy of the certificate with the Registrar of Companies within 7 days after being served the certificate.

(9) A pertinent financial institution that or a subscriber who fails to comply with any provision in the certificate shall be guilty of an offence and shall be liable on conviction —(a)

in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or

(b)

in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction.

(10) Where a person is charged with an offence under subsection (9), it is a defence for the person to prove that —(a)

the person was not aware that the person had contravened any provision in the certificate; and

(b)

the person has complied with the provision within a reasonable time after becoming aware of the contravention.

(11) Except as provided in subsection (10), it is not a defence for a person charged with an offence under subsection (9) that the person did not intend to or did not knowingly contravene any provision in the certificate.

(12) A pertinent financial institution that contravenes subsection (8), and every officer of the pertinent financial institution who fails to take all reasonable steps to secure compliance by the pertinent financial institution with that subsection, shall each be guilty of an offence and shall each be liable on conviction to a fine not exceeding $2,000 and, in the case of a continuing offence, to a further fine not exceeding $200 for every day or part of a day during which the offence continues after conviction.

(13) Despite section 62(2) but subject to section 134, during the period beginning on the date on which the Minister publishes the notice under section 78(7) in the Gazette on the restructuring of the share capital of a pertinent financial institution or (where the notice is not published in the Gazette) the date on which the Authority publishes the certificate under subsection (5) in the Gazette on the restructuring of the share capital, and ending on the date on which the certificate comes into effect —(a)

no resolution may be passed, and no order may be made, for the winding up of the pertinent financial institution;

(b)

no judicial manager may be appointed under Part 7 of the Insolvency, Restructuring and Dissolution Act 2018 in relation to the pertinent financial institution;

(c)

no proceedings may be commenced or continued against the pertinent financial institution in respect of any business of the pertinent financial institution;

(d)

no enforcement order, distress or other legal process may be commenced, levied or continued against any property of the pertinent financial institution;

(e)

no steps may be taken to enforce any security over any property of the pertinent financial institution; and

(f)

any sale, transfer, assignment or other disposition of any property of the pertinent financial institution is void, except for (where the pertinent financial institution is an insurer licensed under the Insurance Act 1966) any payment of claims to policy owners or claimants, other than policy owners who are related corporations of the pertinent financial institution.

(14) In subsection (12), “officer”, in relation to a pertinent financial institution, includes —(a)

a director, a secretary or an executive officer of the pertinent financial institution;

(b)

a receiver or manager of any part of the undertaking of the pertinent financial institution appointed under a power contained in any instrument; and

(c)

a liquidator of the pertinent financial institution appointed in a voluntary winding up.