Regulatory Alerts2021-06-25
Added · Updated
Financial Institutions (Resolution) (Contractual Recognition of Suspension of Termination Rights—Banking Sector) Rules
The Resolution Office issued the Stay Rules to implement the Financial Stability Board's principles for cross-border resolution effectiveness by requiring banking sector entities to include contractual terms recognizing the Monetary Authority's power to suspend termination rights. Covered entities must ensure their contracts contain legally enforceable provisions binding parties to such suspensions, with a compliance period of 24 or 30 months depending on counterparty types. The subsidiary legislation is scheduled for Legislative Council negative vetting on 7 July 2021 and is expected to come into operation on 27 August 2021.
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