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.”.