Netting of Financial Contracts Act, 1995
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Enforceability of netting, set off, guarantees and collateral in relation to netting and master netting agreements. |
4.—(1) Notwithstanding anything contained in any rule of law relating to bankruptcy, insolvency or receivership, or in the Companies Acts or the Bankruptcy Act, 1988 , the provisions— | |
(a) relating to netting, the set off of money provided by way of security, the enforcement of a guarantee and the enforcement and realisation of collateral and the set off of the proceeds thereof, as contained within a netting agreement or a guarantee provided for in such an agreement shall be legally enforceable against a party to the agreement and, where applicable, against a guarantor or other person providing security, and | ||
(b) relating to set off of the net amounts due under netting agreements, the set off of money provided by way of security, the enforcement of a guarantee and the enforcement and realisation of collateral and the set off of the proceeds thereof, as contained within a master netting agreement or a guarantee provided for in such an agreement shall be legally enforceable against a party to the agreement and, where applicable, against a guarantor or other person providing security. | ||
(2) Nothing in subsection (1) shall— | ||
(a) prevent the application of any enactment or rule of law which would prevent the legal enforceability of netting, set off, enforcement and realisation within the meaning of subsection (1) in any particular case, on the grounds of fraud or misrepresentation or on any similar ground and, in particular, by reason of the application of— | ||
(i) sections 57 , 58 and 59 of the Bankruptcy Act, 1988 , | ||
(ii) section 286 of the Companies Act, 1963 , and | ||
(iii) section 139 of the Companies Act, 1990 , | ||
or | ||
(b) permit the enforceability of netting, set off, enforcement and realisation under subsection (1) if any provision of an agreement between the two parties concerned would make netting, set off, enforcement and realisation void whether because of fraud or misrepresentation or any similar ground. | ||
(3) Section II of the Statute of Frauds, 1695 , shall not apply in relation to financial contracts. | ||
(4) For the avoidance of doubt a financial contract shall not be and shall be deemed never to have been void or unenforceable by reason of the Gaming and Lotteries Acts, 1956 to 1986. |