134. Application

(1)             This Part applies to:

(a)             an Authorised Person, or a class of Authorised Persons, prescribed by the AFSA; and

(b)             an entity in a Group to which an Authorised Person or member of a class referred to in (a) belongs if that entity is specified by written notice by the AFSA as an entity having systemic importance.

(2)             An Authorised Person does not cease to be an Authorised Person or an Authorised Person of a particular class for the purposes of this Part merely because it ceases to:

(a)             hold a licence to carry on a Financial Service; or

(b)             carry on a Financial Service, as a result of a Resolution Action.

135. Other powers not limited

Nothing in this Part limits the scope or application of any other provision in these Regulations or any other legislation administered by the AFSA.

136. Rules for the purposes of this Part

The AFSA may make Rules for the purposes of this Part, including Rules relating to:

(a)              the class of Authorised Persons to whom this Part applies;

(b)              Recovery or Resolution Plans;

(c)              Resolvability Assessments;

(d)              the holding and maintenance of Loss Absorbing Capacity;

(e)              the Resolution Powers and Resolution Tools;

(f)               the appointment of independent valuers and the valuations required under this Part;

(g)              the recognition of Resolution Action taken in jurisdictions outside the AIFC;

(h)              the effect of action taken under this Part on provisions in agreements or contracts;

(i)                the notification of events relevant to the AFSA’s exercise of its powers under this Part;

(j)                the conditions and procedures relating to the AFSA exercising any powers under this Part; and

(k)              any other matter necessary or incidental to give effect to this Part.

137. Recovery Plans

(1)         This section applies to an Authorised Person which:

(a)             is of a class prescribed in the Rules as requiring a Recovery Plan; or

(b)           is not included in a class prescribed under (a), but has been given written notice by the AFSA that it must prepare a Recovery Plan.

(2)         An Authorised Person must prepare and submit to the AFSA for review a plan setting out the measures to be taken to restore the financial position of the Authorised Person (or one or more entities in its Group) in the event of a serious deterioration of the Authorised Person’s financial position (the “Recovery Plan”).

(3)         The Recovery Plan must be in writing and set out such information as may be prescribed in the Rules.

(4)         The AFSA may, by written notice given to the Authorised Person, require it to prepare and submit to the AFSA such information that the AFSA considers reasonably necessary for it to assess the adequacy of the Authorised Person’s Recovery Plan.

(5)      If the AFSA is not satisfied with an Authorised Person’s Recovery Plan it may, by written notice, require the Authorised Person to take measures to rectify any deficiencies in the Recovery Plan and submit the rectified Recovery Plan to the AFSA.

(6)         An Authorised Person must review and update its Recovery Plan and submit the updated Recovery Plan to the AFSA:

(a)             annually;

(b)        where there has been a material change reasonably likely to affect the implementation of the original Recovery Plan; or

(c)             if otherwise directed in writing by the AFSA to do so.

138. Resolution Plans

(1)             The AFSA may prepare a plan for securing an orderly Resolution (the “Resolution Plan”) of an Authorised Person.

(2)             The Resolution Plan must set out the strategies for the Resolution (including consideration of failure scenarios, the options for the exercise of the Resolution Powers, the application of the Resolution Tools) and contain such information as may be prescribed in the Rules.

(3)             If the AFSA decides to prepare a Resolution Plan with respect to an Authorised Person, it must inform the Authorised Person in writing of that decision.

(4)             An Authorised Person that is informed of the AFSA’s decision to prepare a Resolution Plan must, to the extent reasonably necessary for the AFSA to prepare, assess or update the Resolution Plan, do the following:

(a)             maintain in the AIFC up to date information and systems; and

(b)             if required in writing by the AFSA, provide to the AFSA any information and assistance within a specified period.

139. Resolvability Assessment

(1)         The AFSA may conduct an assessment to determine if there are any impediments that may prevent or affect the Resolvability of an Authorised Person (the “Resolvability Assessment”).

(2)         An Authorised Person must provide to the AFSA such information and assistance that the AFSA considers reasonably necessary for the Resolvability Assessment.

140. Requirement to Remove Impediments to Resolvability

(1)         The AFSA may by written notice require an Authorised Person or an entity in its Group to take such measures as the AFSA considers reasonably necessary to remove impediments to, or improve, the Resolvability of an Authorised Person.

(2)         The measures may include changes relating to:

(a)             legal, ownership or governance structure;

(b)             operations, including intra-Group dependencies and relationships with third parties;

(c)             business activities or practices;

(d)             financial matters, (including assets, liabilities, rights and obligations), or funding strategy, (including measures to improve the resilience of Core Business Lines and Critical Functions);

(e)             risk profile, including liquidity risk; or

(f)              terms to be included in contracts.

(3)         The procedures in Schedule 2 apply to a decision of the AFSA under this section.

141. Loss Absorbing Capacity Requirement

(1)         The AFSA may by written notice require an Authorised Person to hold and maintain a minimum amount of financial instruments or resources available during Resolution:

(a)             to absorb losses; and

(b)             to enable the Authorised Person to be recapitalised so that it can continue to perform Critical Functions while Resolution is ongoing (“Loss Absorbing Capacity”).

(2)         The AFSA must specify in the notice the nature of the financial instruments or resources to be held and maintained by the Authorised Person.

(3)         The AFSA may vary or revoke a requirement under this section.

(4)         The procedures in Schedule 2 apply to a decision of the AFSA under this section.

142. Conditions for exercise of Early Intervention Powers

The AFSA may exercise one or more of its powers specified in section 143 in relation to an Authorised Person if it considers that:

(a)         an Authorised Person’s liquidity or solvency is impaired, or may soon be impaired unless there is a major improvement in its financial resources, assets, leverage exposures, risk profile, business model, risk management systems and controls, or quality of its governance and management;

(b)         one or more indicators in the Authorised Person’s Recovery Plan for taking action to restore its financial position demonstrate inadequate remedial action; or

(c)         it is otherwise necessary and desirable to meet the AFSA’s objectives.

143. Early Intervention Powers

(1)         The AFSA may by written notice require an Authorised Person to prepare and submit to the AFSA a corrective action plan that:

(a)         examines the status of its liquidity or solvency impairment;

(b)         explains in detail the corrective actions that will be taken to address and rectify identified weaknesses; and

(c)          sets out the timeframes for the corrective actions.

(2)         The AFSA may also by written notice require an Authorised Person to:

(a)         call a general meeting of shareholders, set an agenda and propose specified resolutions;

(b)         search for, and communicate with, potential purchasers of the Authorised Person’s business or part of the business;

(c)          remove directors or senior management who have failed to meet their obligations, including fiduciary duties

(d)         limit or, if appropriate, clawback compensation paid to directors and senior management;

(e)         obtain the AFSA’s written approval before making or incurring any major capital expenditure, material commitment or contingent liability;

(f)           enhance internal governance, systems, controls and risk management; or

(g)         implement one or more measures in the Authorised Person’s Recovery Plan.

144. Conditions for Resolution and general provisions

(1)         The AFSA may exercise its Resolution Powers or apply its Resolution Tools in relation to an Authorised Person only if it is satisfied that the following conditions (the “Resolution Conditions”) are met:

(a)         the Authorised Person is failing or is likely to fail;

(b)         having regard to timing and other relevant circumstances, it is not reasonably likely that any action that is taken by or in respect of the Authorised Person will prevent the failure or likely failure of the Authorised Person within a reasonable timeframe; and

(c)          the taking of Resolution Action is in the public interest.

(2)             For the purposes of paragraph (a) of subsection (1), an Authorised Person is failing or likely to fail if one or more of the following circumstances exist:

(a)         it no longer meets requirements under these Regulations or Rules or other legislation administered by the AFSA, such as prescribed capital or liquidity levels;

(b)         its access to market-based funding sources is seriously impaired;

(c)         there is a significant deterioration in the value of its assets;

(d)         there are serious governance issues or deficiencies in its risk management and controls that may have a significant impact on the Authorised Person’s financial condition; or

(e)         it is unable to pay its debts or other liabilities as they fall due.

However, an Authorised Person is not failing or likely to fail merely because one or more Early Intervention Powers have been exercised in relation to it.

(3)             Subject to paragraph (a) of subsection (1) and subsection (2), the AFSA may take into account the likely impact on the Authorised Person of the failure or likely failure of another entity in the Authorised Person’s Group.

(4)             For the purposes of paragraph (c) of subsection (1), an action is in the public interest if:

(a)         it is necessary and proportionate to achieve one or more of the AFSA’s objectives; and

(b)         winding up the Authorised Person under the AIFC Insolvency Regulations or other applicable insolvency laws would not meet the AFSA’s objectives to the same extent.

(5)             An Authorised Person must immediately notify the AFSA if its senior management reasonably considers or is aware that:

(a)             it is failing or likely to fail;

(b)             another entity in its Group is failing or likely to fail;

(c)             in the case of an Authorised Person operating as a branch in the AIFC, the Resolution Authority in the jurisdiction of its head office is considering, or has initiated, Resolution Action in relation to the Authorised Person;

(d)             a Resolution Authority, in a jurisdiction where another entity in its Group is present is considering, or has initiated, Resolution Action in relation to that entity; or

(e)             a Resolution Authority in the jurisdiction of the head office of the legal entity of which the Authorised Person is a subsidiary is considering, or has initiated, Resolution Action in relation to the head office.

(6)             If the AFSA determines that the Resolution Conditions are met in respect of an Authorised Person, it:

(a)             must record its decision together with the reasons for that decision and the actions that it intends to take as a result of the decision;

(b)             must give written notice of the decision to:

(i)               the Authorised Person;

(ii)             if applicable, the financial services regulator and Resolution Authorities of jurisdictions in which any relevant Group entity or significant branches are located; and

(iii)            if applicable, any scheme for the protection of depositors or Clients that is relevant to the Authorised Person; and

(c)             may publish information about the decision if it appears to the AFSA to be desirable to do so in the public interest.

145. Appointment of Independent Valuer

(1)         The AFSA may arrange for an independent valuer to be appointed to carry out a valuation of the assets and liabilities of an Authorised Person for the purposes of this Chapter.

(2)         The AFSA may prescribe in the Rules the eligibility requirements for a person to be appointed as an independent valuer.

(3)         A valuation by an independent valuer must be carried out in such manner as the AFSA may prescribe in the Rules.

(4)         The AFSA:

(a)             may require the Authorised Person to pay the cost of any valuation; or

(b)             may recover those costs from the Authorised Person.

146. Valuations

(1)             Before the AFSA exercises a Resolution Power in respect of an Authorised Person, it must cause a valuation to be carried out to assess the value of the assets and liabilities of the Authorised Person (a “Pre-Resolution Valuation”).

(2)             Despite subsection (1), if the urgency of the case makes it appropriate for a Resolution Power to be exercised in respect of an Authorised Person before a Pre-Resolution Valuation can be carried out, the AFSA may cause a provisional valuation to be carried out of the assets and liabilities of the Authorised Person (a “Provisional Valuation”).

(3)             If the AFSA causes a Provisional Valuation to be carried out, it shall cause a further valuation (a “Definitive Valuation”) to be carried out on the assets and liabilities of the Authorised Person as soon as practicable after the Provisional Valuation.

(4)             A Pre-Resolution Valuation, Provisional Valuation and Definitive Valuation must be carried out in such manner as the AFSA may prescribe in the Rules.

147. Resolution Powers

(1)             If the AFSA is satisfied that the Resolution Conditions have been met, it may, by written notice, exercise one or more of the following Resolution Powers in relation to an Authorised Person:

(a)             remove and replace any director or member of senior management (regardless of whether they are responsible for the failure);

(b)             appoint one or more individuals to act as a Temporary Administrator in accordance with section 150;

(c)             recover monies from any person whose acts or omissions materially contributed to the failure, including by the claw-back of variable remuneration such as bonuses;

(d)             terminate contracts, continue or assign contracts or purchase or sell assets;

(e)             write down or convert any instrument or liability;

(f)              ensure continuity of essential services and functions by:

(i)               requiring other entities in the Group to continue to provide essential services or facilities to the Authorised Person or any successor or an acquiring entity; or

(ii)             procuring the essential services or facilities from unaffiliated third parties;

(g)             override rights of shareholders of the Authorised Person, including requirements for approval by shareholders of particular transactions, in order to permit a merger, acquisition, sale of business operations, recapitalisation or other measures to restructure and dispose of the Authorised Person’s business, liabilities or assets;

(h)             apply the Sale of Business Tool;

(i)               apply the Bail-In Tool;

(j)               require the Authorised Person to prepare and implement a Business Reorganisation Plan;

(k)             temporarily suspend the exercise of early termination rights under any contracts or agreements that may otherwise be triggered upon entry of the Authorised Person into Resolution or in connection with the exercise of Resolution Powers or application of a Resolution Tool;

(l)               impose a moratorium with a suspension of payments to unsecured creditors and Clients (except for payments to central counterparties, payment, clearing and settlements systems and central banks) and a stay on creditor actions to attach assets or otherwise collect money or property from the Authorised Person, while protecting the enforcement of eligible netting and collateral agreements;

(m)           take any action necessary to effect the restructure or closure and orderly wind-down of the whole or part of the business of the Authorised Person while facilitating prompt access to transaction accounts and to segregated Client Assets;

(n)             require the Authorised Person or any of the entities in the Group to provide any services or facilities;

(o)             require the Authorised Person to promptly return Client Assets to Clients;

(p)             suspend any payment or delivery obligations pursuant to any contract to which the Authorised Person is a party; or

(q)             restrict secured creditors of the Authorised Person from enforcing security interests in relation to any assets of the Authorised Person.

(2)             In addition to the powers specified in subsection (1), the AFSA may:

(a)             require any person to provide any information required for the AFSA to decide upon and prepare Resolution Action, including to update or supplement information provided in the Resolution Plan;

(b)             remove rights to acquire further Shares, such as shareholders’ pre-emption rights in the case of a new Share issue under the AIFC Companies Regulations;

(c)             cancel or modify the terms of a contract to which the Authorised Person is a party or substitute a purchaser under the Sale of Business Tool as a party;

(d)             in relation to Debenture and other Eligible Liabilities issued by the Authorised Person:

(i)               amend or alter the maturity;

(ii)             amend the amount of interest payable; or

(iii)            amend the date on which the interest becomes payable, including by suspending payment for a temporary period;

(e)             close out and terminate financial contracts or derivative contracts for the purposes of the application of the Bail-In Tool;

(f)              require a person to discontinue or suspend the admission to trading of financial instruments relating to the Authorised Person; and

(g)             apply powers to allocate losses and allocate or terminate contracts of an Authorised Market Institution taking into account the particular circumstances of the Authorised Market Institution.

(3)             The AFSA may exercise its Resolution Powers when the Resolution Conditions are met under section 144:

(a)             regardless of any restriction on, or requirement to obtain consent for, the transfer of the financial instruments, rights, assets or liabilities in question that might otherwise apply;

(b)             without the requirement to obtain approval or consent from any person either public or private, including the shareholders or creditors of the Authorised Person; and

(c)             without the requirement to notify any person, including any requirement to publish any notice or Prospectus or to file or register any document with any other authority.

(4)             The AFSA may consult and cooperate with a central bank when planning or carrying out the Resolution of an Authorised Market Institution if that Authorised Market Institution is linked to the systems operated by the central bank.

(5)             The procedures in Schedule 2 apply to a decision of the AFSA under subsections (1) and (3).

148. Sale of Business Tool

(1)             The AFSA may apply the Sale of Business Tool to an Authorised Person by effecting a sale of all or part of the business of the Authorised Person to one or more purchasers. The Sale of Business Tool is effected by:

(a)             making one or more property transfer instruments for the transfer of all or any rights, assets or liabilities of the Authorised Person; and

(b)             if an Authorised Person is not a branch, making one or more Share transfer instruments for the transfer of all or part of the Shares of the Authorised Person.

(2)             The AFSA may apply the Sale of Business Tool to an Authorised Person without complying with any procedural requirements under the AIFC Companies Regulations or the constitutional documents of the Authorised Person.

(3)             The AFSA may prescribe Rules relating to the application of the Sale of Business Tool.

(4)             The procedures in Schedule 2 apply to a decision of the AFSA under this section.

149. Bail-In Tool

(1)             The Bail-In Tool is a Resolution Tool that may be applied by the AFSA in relation to an Authorised Person that is not a branch:

(a)             to recapitalise the Authorised Person:

(i)               to the extent sufficient to restore the Authorised Person’s ability to comply with the authorisation requirements as applicable;

(ii)             to continue to carry out the activities for which the Authorised Person is authorised under these Regulations; or

(iii)            to sustain sufficient market confidence in the Authorised Person;

(b)             to convert to Shares or reduce the principal amount of claims or Debenture that are transferred under the Sale of Business Tool.

(2)             In applying the Bail-In Tool the AFSA may use the Write Down or Conversion Power in such manner as may be prescribed in the Rules.

(3)             The AFSA may prescribe Rules relating to the application of the Bail-In Tool.

(4)             The procedures in Schedule 2 apply to a decision of the AFSA under this section.

150. Temporary Administrator

(1)             The AFSA may appoint a Temporary Administrator to replace the management of an Authorised Person.

(2)             The Temporary Administrator has such powers of the shareholders and management of the Authorised Person, as are specified by the AFSA in the instrument of appointment.

(3)             The Temporary Administrator has a duty to take all measures necessary to promote the AFSA’s objectives in relation to Resolution. The duty may, if necessary, override any other duty placed upon the management of the Authorised Person under Acting Law of the AIFC and the Authorised Person’s constitutional documents.

(4)             The person appointed to be the Temporary Administrator may be an individual (or one or more individuals acting jointly) or a body corporate.

(5)             Before appointing a person to be a Temporary Administrator, the AFSA must be satisfied that the person has sufficient qualifications, experience, and the fitness and propriety necessary to carry out the functions of a Temporary Administrator.

(6)             A Temporary Administrator must not be treated as a director (formally or de facto) of the Authorised Person.

(7)             The instrument of appointment must specify the date on which the appointment takes effect and the period of the appointment. The period of appointment must be for an initial period of not more than 12 months, but the AFSA may extend that appointment for a further period not more than 12 months.

(8)             The instrument of appointment may require the Temporary Administrator to report to the AFSA on any matter specified in the instrument and at the time or at intervals specified in the instrument.

(9)             The instrument of appointment may provide for the AFSA to pay the remuneration and costs of the Temporary Administrator or for the remuneration and costs of the Temporary Administrator to be paid by the Authorised Person, its parent or another entity in its Group.

(10)          The AFSA may vary the terms of appointment of a Temporary Administrator.

151. Resolution Safeguards

The AFSA must, when exercising a Resolution Power or applying a Resolution Tool in relation to an Authorised Person, aim to meet the following safeguards:

(a)             no shareholder, creditor or Client (including depositor and Policyholder) should be worse off under the Resolution Action than if the Authorised Person had been wound up under ordinary insolvency proceedings; and

(b)             any other Resolution Safeguards that may be prescribed in the Rules.

152. Costs of Resolution

(1)             The AFSA:

(a)             may require the Authorised Person to pay the costs of exercising a Resolution Power or applying a Resolution Tool; or

(b)             may recover those costs from the Authorised Person.

(2)             Without limiting subsection (1), the AFSA may recover the costs:

(a)             as a deduction from any consideration paid by a transferee to the Authorised Person (in the case of a transfer of property under paragraph (a) of subsection (1) under section 148);

(b)             as a deduction from the owners of the Shares (in the case of a transfer of Shares under paragraph (b) of subsection (1) under section 148); or

(c)             from the Authorised Person, as a preferred creditor.

153. Recognition of Resolution Actions in other jurisdictions

(1)             If a Resolution Authority in another jurisdiction notifies the AFSA that it intends to take or has taken Resolution Action in relation to an entity in that jurisdiction and requests the AFSA to recognise that Resolution Action, the AFSA may:

(a)             make an order recognising the Resolution Action;

(b)             make an order recognising part of the Resolution Action, and refuse to recognise the remainder of it; or

(c)             refuse to recognise the Resolution Action.

(2)             When considering whether to recognise Resolution Action taken in a jurisdiction outside the AIFC, the AFSA must consider the impact of its decision on financial stability in the AIFC, and in any other jurisdiction.

(3)             The AFSA may refuse to recognise Resolution Action in another jurisdiction, or any part of a Resolution Action, if it is satisfied that one or more of the following conditions are met:

(a)             the recognition would have an adverse effect on financial stability, the financial services industry in the AIFC or the economy of the Republic of Kazakhstan (whether this effect would occur directly or indirectly as a result of the recognition);

(b)             the exercise of a Resolution Power or application of a Resolution Tool by the AFSA, rather than recognition of the Resolution Action in relation to the entity is necessary to achieve one or more of the AFSA’s objectives in relation to Resolution;

(c)             under the Resolution Action, creditors, Clients (including, in particular, depositors and Policyholders) or shareholders located or payable in the AIFC would not, by reason of being located and payable in the AIFC, receive the same treatment, and have similar legal rights, as creditors, Clients (including depositors and Policyholders) or shareholders who are located or payable in the other jurisdiction concerned; or

(d)             the recognition would have a significant detrimental impact on the AIFC or be unlawful under Acting Law of the AIFC.

(4)             If the AFSA makes a decision under subsection (1), the AFSA:

(a)             must record its decision together with the reasons for that decision;

(b)             must give written notice of the decision to:

(i)               the Resolution Authority in the other jurisdiction;

(ii)             if it considers it necessary, the entity; and

(iii)            if it considers it necessary, any Resolution Authority in any other relevant jurisdiction; and

(c)             may publish information about the decision if it considers it is desirable to do so in the public interest.

(5)             For the purposes of supporting, or giving full effect to, an order under (1)(a) or (b) (a “Resolution Recognition Order”), the AFSA may:

(a)             include in the order any provision that the AFSA considers necessary to give effect to the order; or

(b)             exercise or apply in conjunction with the order one or more Resolution Powers or Resolution Tools as it considers appropriate in the circumstances.

(6)             A Resolution Recognition Order must not prejudice the winding up of an Authorised Person under ordinary insolvency proceedings, unless the winding up conflicts with the Resolution Action, in which case the recognised Resolution Action takes precedence.

154. Application of Insolvency Regulations

(1)             To the extent that this Part is inconsistent with the Insolvency Regulations, the provisions of this Part prevail.

(2)             If the AFSA determines that the Resolution Conditions have been met in relation to an Authorised Person, a person may not commence insolvency proceedings under the Insolvency Regulations in respect of the Authorised Person except with the AFSA’s consent.

(3)             The AFSA may apply to the AIFC Court under section 123 for the winding up of an Authorised Person or commence insolvency proceedings under the Insolvency Regulations in respect of the Authorised Person even if AFSA has determined that the Resolution Conditions have been met or AFSA has taken Resolution Action under this Part in respect of the Authorised Person.

(4)             The AFSA may take Resolution Action under this Part in relation to an Authorised Person even if insolvency proceedings have already commenced in relation to the Authorised Person

155. Protection from liability

(1)             An Authorised Person, an entity in its Group or a director or employee of the Authorised Person or an entity in its Group is not liable for damages in respect of anything done or omitted to be done in good faith in accordance with a requirement made by the AFSA under this Part.

(2)             A Temporary Administrator or an independent valuer appointed under this Part is not liable for damages in respect of anything done or omitted to be done in good faith for the purposes of, or in connection with, the performance of functions under that appointment.

156. Default Event Provision

(1)             Section 156(2) applies if a contract or other agreement:

(a)             is entered into by an Authorised Person or a Regulated Financial Institution; or

(b)             includes cross-default provisions, and is entered into by another Group entity in the Authorised Person’s Group or Regulated Financial Institution’s Group, and the substantive obligations provided for in the contract or agreement (including payment and delivery obligations and provision of collateral) continue to be performed.

(2)             The following must be disregarded in determining whether a Default Event Provision applies:

(a)             the exercise of a measure in an Authorised Person’s Recovery Plan, the removal of impediments to Resolvability of an Authorised Person, the imposition of an Early Intervention Power, the appointment of a Temporary Administrator, the exercise of a Resolution Power or application of a Resolution Tool, or the recognition of a Resolution Action taken by a Resolution Authority; and

(b)             the occurrence of any event directly linked to the exercise or application of such measure, power, tool or action.

(3)             A notice under section 147 may specify additional matters to be disregarded under (2). Any such matters must be disregarded.

(4)             In this section, “specified” in relation to a contract or agreement means specified in the contract or other agreement.

(5)             In this section, “Default Event Provision” means a provision of a contract or other agreement:

(a)             that has the effect that if a specified event or situation arises:

(i)               the agreement is terminated, modified, replaced or suspended;

(ii)             rights or duties under the agreement are terminated, modified, replaced or suspended;

(iii)            a right accrues to terminate, modify or replace the agreement;

(iv)            a right accrues to terminate, modify or replace rights or duties under the agreement;

(v)             a set-off or netting right accrues under the agreement;

(vi)            a sum becomes payable or ceases to be payable;

(vii)           a right accrues to obtain possession, exercise control or enforce any security over any property;

(viii)         delivery of anything becomes due or ceases to be due;

(ix)            a right to claim a payment or delivery accrues, changes or lapses;

(x)             any other right accrues, changes or lapses; or

(xi)            an interest is created, changes or lapses; or

(b)             that has the effect that a provision of the contract or agreement:

(i)               takes effect only if a specified event occurs or does not occur;

(ii)             takes effect only if a specified situation arises or does not arise;

(iii)            has effect only for so long as a specified event does not occur;

(iv)            has effect only while a specified situation lasts;

(v)             applies differently if a specified event occurs;

(vi)            applies differently if a specified situation occurs; or

(vii)           applies differently while a specified situation lasts.”.