Exercise of Reserve Bank powers under this Part not grounds for denial of obligations
(1) Subject to subsection (5), this section applies if a body corporate (the protected body corporate) is party to an arrangement, whether the proper law of the arrangement is: (a) Australian law; or (b) foreign law, including the law of part of a foreign country. (2) None of the matters mentioned in subsection (3) allows the arrangement, or a party to the arrangement (other than the protected body corporate), to do any of the following: (a) deny any obligation under the arrangement; (b) accelerate any debt under the arrangement; (c) terminate or close out: (i) the arrangement; or (ii) any transaction relating to the arrangement; (d) enforce any security under the arrangement. (3) The matters are as follows: (a) the protected body corporate being subject to the exercise of a power under this Part by the Reserve Bank; (b) a body corporate to which subsection (4) applies being subject to the exercise of a power under this Part by the Reserve Bank; (c) if section 842A applies to a body corporate to which subsection (4) of this section applies—the financial position of: (i) that body corporate; or (ii) any other body corporate to which that subsection applies. (4) For the purposes of paragraph (3)(b) or (c), this subsection applies to: (a) a related body corporate of the protected body corporate; or (b) a body corporate that was a related body corporate of the protected body corporate before a transfer of business or shares under this Part. Payment Systems and Netting Act 1998 prevails over this section (5) If there is any inconsistency between: (a) subsections (1) to (4) of this section; and (b) the Payment Systems and Netting Act 1998; that Act prevails to the extent of the inconsistency. Arrangements to which this section does not apply (6) This section does not apply to a kind of arrangement prescribed by the regulations for the purposes of this subsection.
Sourced from the Federal Register of Legislation at 17 May 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au. Verify the current text against the official source before relying on it.
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