Modifications of law of insolvency
Open ↗6.—(1) The general law of insolvency has effect in relation to —(a)
transfer orders effected through a designated system; and
(b)
action taken under the Rules of a designated system with respect to the orders,
subject to the provisions of this Part.
[4/2018]
(2) This Part applies in relation to bankruptcy, judicial management and winding up proceedings only in respect of a participant.
(3) Even though rights or liabilities arising from transfer orders are or may be dealt with in bankruptcy, judicial management or winding up proceedings, this Part does not apply to the proceedings if they are in respect of any person who is not a participant.
Transactions under Rules of designated system are final and irrevocable
Open ↗7.—(1) This section applies where the Rules of a designated system provide that —(a)
the transfer of funds into and out of an account of a participant;
(b)
the netting or settlement of any payment obligation; or
(c)
the settlement and transfer of book-entry securities,
is final and irrevocable.
[4/2018]
(2) Despite anything to the contrary in any written law or rule of law, any transfer, netting or settlement referred to in subsection (1) must not be reversed, repaid or set aside and no order is to be made by any court for the rectification or stay of the transfer, netting or settlement.[4/2018]
Proceedings of designated system take precedence over law of insolvency
Open ↗8.—(1) None of the following is to be regarded as to any extent invalid on the ground of inconsistency with the law for distribution of the assets of a person on bankruptcy or winding up, or on the appointment of a receiver, receiver and manager or an equivalent officer over any of the assets of a person:(a)
a transfer order;
(b)
any disposition of property pursuant to such an order;
(c)
any action taken under the Rules of a designated system.[4/2018]
(2) The powers of a relevant office holder and the powers of a court under the law of insolvency must not be exercised in such a way as to prevent or interfere with —(a)
the netting or settlement of a transfer order in accordance with the Rules of a designated system; or
(b)
any other action taken under the Rules of a designated system.[4/2018]
(3) A debt or other liability arising out of a transfer order which is the subject of action taken under default arrangements may not be proved in a bankruptcy or winding up until the completion of the action taken under default arrangements.
(4) A debt or other liability which by virtue of subsection (3) may not be proved must not be taken into account for the purposes of any set‑off until the completion of the action taken under default arrangements.
Disclaimer of property, restriction on dispositions of property, etc.
Open ↗9. Without limiting section 8 —(a)
sections 230, 231, 373 and 374 of the Insolvency, Restructuring and Dissolution Act 2018 do not apply to a transfer order;
(b)
sections 130(1) and 328 of the Insolvency, Restructuring and Dissolution Act 2018 do not apply to a transfer order or any disposition of property pursuant to the order; and
(c)
a court must not make an order under section 66 of the Insolvency, Restructuring and Dissolution Act 2018 in relation to any disposition of property pursuant to a transfer order.[4/2018; 40/2018]
Adjustment of prior transactions
Open ↗10. Without limiting section 8, no order may be made by a court under section 67, 101, 224, 225, 228, 361, 362, 366 or 438 of the Insolvency, Restructuring and Dissolution Act 2018 in relation to a transfer order or any disposition of property pursuant to such an order.[40/2018]
Net sum payable on completion of action taken under default arrangements
Open ↗11.—(1) This section applies with respect to any net sum owed by or to a defaulter on the completion of the action taken under default arrangements.
(2) Despite sections 218, 219, 345 and 346 of the Insolvency, Restructuring and Dissolution Act 2018, where a court has made an order for bankruptcy or winding up of a participant or a resolution for the voluntary winding up of a participant has been passed, the net sum referred to in subsection (1) is —(a)
provable in the bankruptcy or winding up or (as the case may be) payable to the relevant office holder; and
(b)
taken into account, where appropriate, under section 219 or 346 of the Insolvency, Restructuring and Dissolution Act 2018.[40/2018]
Transfer orders entered into designated system after insolvency
Open ↗12. This Part does not apply in relation to any transfer order given by a participant which is entered into a designated system after the expiry of one business day after —(a)
a court made an order for bankruptcy, judicial management or winding up in respect of the participant;
(b)
a resolution for the participant to be placed under the judicial management of a judicial manager was passed under section 94(11) of the Insolvency, Restructuring and Dissolution Act 2018; or
(c)
a resolution for the voluntary winding up of the participant was passed.[4/2018; 40/2018]
Source: Singapore Statutes Online (Attorney-General's Chambers), © Government of Singapore.
