Corporations Act 2001

The Reserve Bank may take actions under this Part that are appropriate to manage or respond to a CS facility licensee in crisis.

A CS facility licensee is in crisis if certain conditions are met in relation to the licensee (see section 831A ). These conditions relate to acts or events that are likely to pose a threat to:

(a) the stability of the financial system in Australia; or

(b) the continuity of clearing and settlement facility services that are critical to the functioning of the financial system in Australia.

Some of the conditions relate to related bodies corporate of the CS facility licensee.

The actions the Reserve Bank may take include:

(a) placing the licensee, or a related body corporate that is incorporated in Australia, under statutory management; and

(b) compulsorily transferring all or part of the shares of, or business of, the licensee, or a related body corporate that is incorporated in Australia, to another body corporate; and

(c) directing the licensee, or a related body corporate that is incorporated in Australia, to do or refrain from doing an act or thing.

If a body corporate is under statutory management or subject to a transfer or direction, a moratorium applies to the body corporate.

The Reserve Bank, on request, may exercise some of its functions and powers under this Part to assist foreign regulators to manage or respond to an overseas clearing and settlement facility licensee in crisis.