S.L. 330.9 Art. 71AContractual recognition of resolution stay powers.

(1)The institutions and entities referred to in paragraphs

(b), (c) or (d) of the definition "entity" in regulation 2(1) shall include, in any financial contract which they enter into and which is governed by third-country law, terms which the parties recognise that the financial contract may be subject to the exercise of powers by the Resolution Committee to suspend or restrict rights and obligations under regulations 33B, 69, 70 and 71, and recognise that they are bound by the requirements of regulation 68.

(2) The Resolution Committee shall also require that Union parent undertakings ensure that their third-country subsidiaries include, in the financial contracts referred to in sub-regulation (1), terms to exclude that the exercise of the power of the Resolution Committee to suspend or restrict rights and obligations of the Union parent undertaking, in accordance with sub-regulation (1), constitutes a valid ground for early termination, suspension, modification, netting, exercise of set-off rights or enforcement of security interests on those contracts:

Provided that, the requirement in sub-regulation (1) may apply in respect of third-country subsidiaries which are:

(a) credit institutions;

(b) investment firms (or which would be investment firms if they had a head office in the relevant Member State); or

(c) financial institutions.

(3) Sub-regulation (1) shall apply to any financial contract which:

(a) creates a new obligation, or materially amends an existing obligation after the entry into force of the provisions of this regulation;

(b) provides for the exercise of one or more termination rights or rights to enforce security interests to which regulation 33B, 68, 69, 70 or 71 would apply if the financial contract were governed by the laws of a Member State.

(4) Where an institution or entity referred to in paragraphs (b), (c) or (d) of the definition "entity" in regulation 2(1), does not include the contractual term required in accordance with sub-regulation (1), that shall not prevent the Resolution Committee from applying the powers referred to in regulations 33A, 68, 69, 70 or 71 in relation to that financial contract.