Special Resolution Regimes definition
Examples of Special Resolution Regimes in a sentence
To address this, the Final Rule requires a Covered Entity to ensure that each QFC it enters into (a "Covered QFC") includes provisions that (i) restrict default rights against such Covered Entity to the same extent as provided under the U.S. Special Resolution Regimes and (ii) restrict the exercise of any cross-default rights against such Covered Entity based on any affiliate's entry into bankruptcy or similar proceedings.
This is not limited to a proceeding under the U.S. Special Resolution Regimes but would also include, for example, a proceeding under Chapter 11 of the U.S. Bankruptcy Code.
These powers become effective upon the occurrence of certain resolution-related trigger events, as if the contract and all contractual parties were subject to such U.S. Special Resolution Regimes.
The stay-and-transfer provisions of the U.S. Special Resolution Regimes would not achieve their purpose of facilitating orderly resolution in the context of the failure of a GSIB with large volumes of QFCs if such QFCs could escape the effect of those provisions.
In addition, the Securities and the Guarantee contain an ex- press contractual recognition that in the event the Issuer or the Guarantor, or any of their affili- ates, becomes subject to a proceeding under a U.S. Special Resolution Regimes, default rights against the Issuer or the Guarantor with respect to the Relevant Agreements are permitted to be exercised to no greater extent than such default rights could be exercised under such U.S. Special Resolution Regimes.
Congress recognized the importance of such restrictions when it enacted the stay-and-transfer provisions of the U.S. Special Resolution Regimes.
While the final rule’sstay period is similar to the stay periods that would be imposed by the U.S. Special Resolution Regimes, it could run longer than those stay periods under some circumstances.
In this way, the final rule enhances the prospects for an orderly resolution in bankruptcy and under theU.S. Special Resolution Regimes.
The stay-and-transfer provisions of the U.S. Special Resolution Regimes should be enforced with respect to all contracts of any U.S. GSIB entity that enters resolution under a U.S. Special Resolution Regime, as well as all transactions of the subsidiaries of such an entity.
Because of the current risk that the stay-and-transfer provisions of U.S. Special Resolution Regimes may not be recognized under the laws of other jurisdictions, section 252.83 of the final rule requires similar contractual recognition to help ensure that courts in foreign jurisdictions will recognize these provisions.This requirement would advance the goal of the final rule of removing QFC-related obstacles to the orderly resolution of a GSIB.