Chapter 6: Powers of the Competent Authority
Article 24
To carry out resolution procedures, the competent authority shall have the powers to:
1. demand any person to provide any information or documents relevant to the implementation of this Law;
2. assume the powers of the owners and management of the SIFI under resolution, including dismissal of the management and appointment of a new management, and take necessary actions to file a liability claim against the management;
3. sell and transfer any of the capital instruments or securities of the SIFI under resolution, and order any entity or person to amend relevant records;
4. reduce the nominal value of the capital instruments issued by the SIFI under resolution, subject to the provisions on determining nominal values provided for in the Companies Law;
5. order the SIFI under resolution or its holding company to issue capital instruments;
6. amend the maturity date or the amount of the liabilities of the SIFI under resolution, with the exception of guaranteed liabilities;
7. close the financial positions of the SIFI under resolution and terminate its financial contracts and derivative contracts; the Implementing Regulations shall determine the positions and contracts indicated in this paragraph;
8. demand the suspension of the trade of any security or its delisting, or demand the re-listing and trade of debt instruments after their depreciation;
9. suspend the right to terminate or expedite any liability to which the SIFI under resolution is party, including liabilities which have been sold or transferred to the transferee or the transitional entity, provided that the suspension of the rights related to guaranteed liabilities does not exceed two business days, with the exception of the guaranteed liabilities arising from subscriptions to settlement systems; and
10. order any party to continue with the implementation of contracts to which the subsidiary institution of the SIFI under resolution is party, where the contractual liabilities of the subsidiary institution are guaranteed or supported by the SIFI, regardless of any contractual right to termination, liquidation, or expedition.
Article 25
1. The competent authority shall initiate resolution procedures in accordance with the provisions of the Law, without the need to satisfy any other statutory or procedural requirements.
2. The competent authority may appoint a natural or legal person as an administrator for the resolution procedures, in accordance with criteria set thereby, to replace the management of the SIFI under resolution. The competent authority shall determine his remuneration and its source, and may also grant him all the powers necessary to manage the SIFI. The administrator shall exercise due diligence and shall not be held liable for any damage arising from his actions, unless the damage is a result of bad faith, willful misconduct, gross negligence, fraud, or deception.
Article 26
The competent authority may determine the method for executing new financing contracts concluded by the SIFI under resolution, including the execution of the following:
1. The obligation to pay or deliver, or the obligation to receive or accept payment.
2. Termination or expedition.
3. Set-off or payment of agreed settlement.
4. Identification of cases where sham or fraudulent transactions which precede the SIFI crisis are terminated.
5. Enforcement of guarantees.
Article 27
1. It shall not be permissible to register a request for initiating bankruptcy procedures or a judicial filing of a SIFI without the approval of the competent authority, which shall either accept or reject the request within 90 days; such period may be extended by the authority.
2. The lapse of the period indicated in paragraph (1) of this Article without a decision being rendered by the competent authority shall be deemed an approval.
3. Subject to the provisions of paragraph (4) of this Article, if the competent authority refuses to initiate bankruptcy procedures for the SIFI, it shall initiate resolution procedures if the conditions stipulated in Article 10 of this Law are met.
4. If any bankruptcy procedure is initiated for the SIFI and the competent authority decides to subject the SIFI to resolution procedures, it shall submit a request to terminate the initiated bankruptcy procedure and obtain a final ruling prior to commencing the resolution procedures.
5. Any judicial proceeding for the SIFI under resolution shall be suspended, and may not be resumed except after the resolution procedures are completed or upon the consent of the competent authority.