Statute Details
- Title: Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Bonds) (No. 8) Regulations 2006
- Act Code: SFA2001-S162-2006
- Type: Subsidiary Legislation (SL)
- Authorising Act: Securities and Futures Act (Cap. 289)
- Enacting power: Section 337(1) of the Securities and Futures Act
- Commencement: 15 March 2006
- Regulation number: SL 162/2006
- Status: Current version as at 27 March 2026 (per provided extract)
- Key provisions: Regulation 1 (Citation and commencement), Regulation 2 (Definitions), Regulation 3 (Exemption)
What Is This Legislation About?
The Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Bonds) (No. 8) Regulations 2006 (“Stabilising Action Exemption Regulations”) is a targeted set of rules made under the Securities and Futures Act (the “SFA”). In plain terms, it creates a narrow exemption from certain market conduct provisions when stabilising activity is carried out in relation to specified bond issuances.
Market conduct rules in the SFA are designed to prevent manipulation and unfair practices in securities markets. However, in many bond offerings, it is common for underwriters or banks to take limited steps to support the trading price shortly after issuance—often referred to as “stabilising action.” The policy rationale is that stabilisation can facilitate orderly trading and reduce volatility during the initial period after a bond is issued.
This legislation does not create a general permission to stabilise. Instead, it grants an exemption only for stabilising actions taken in respect of two specific categories of bonds issued by the Republic of Indonesia (the “2017 Bonds” and the “2035 Bonds”), only within a defined time window, and only when the stabilising action is undertaken by specified categories of persons and meets a minimum consideration threshold where the stabiliser is acquiring the bonds as principal.
What Are the Key Provisions?
Regulation 1 (Citation and commencement) provides the formal citation and states that the Regulations come into operation on 15 March 2006. For practitioners, this matters because the exemption is only available for stabilising actions taken after commencement (unless the relevant stabilising period overlaps with issuance dates in a way that is consistent with the Regulations’ wording and the underlying issuance timeline).
Regulation 2 (Definitions) is critical because it defines the scope of the exemption. The Regulations identify two bond instruments by reference to their coupon, maturity, due dates, issuer, and maximum principal amount:
- “2017 Bonds”: 11-year 6.875% bonds due on 9 March 2017 issued by the Republic of Indonesia for a principal amount of up to US$1,000,000,000.
- “2035 Bonds”: 29-year and 7-month 8.50% bonds due on 12 October 2035 issued by the Republic of Indonesia for a principal amount of up to US$1,000,000,000.
The Regulations also define “stabilising action” as an action taken in Singapore or elsewhere by Barclays Bank PLC (or any of its related corporations) to buy, or to offer or agree to buy, either:
- the 2017 Bonds to stabilise or maintain their market price in Singapore or elsewhere; or
- the 2035 Bonds to stabilise or maintain their market price in Singapore or elsewhere.
Finally, the definition section cross-references the SFA meaning of “securities” and introduces a concept of “relevant person” by reference to section 275(2) of the Act. This cross-reference is important: it means the exemption is not limited to one type of entity; it can extend to persons who qualify as “relevant persons” under the SFA’s framework.
Regulation 3 (Exemption) is the operative provision. It provides that Sections 197 and 198 of the SFA shall not apply to stabilising action taken in respect of the specified bonds, subject to strict conditions.
1) Exemption for the 2017 Bonds (Regulation 3(1)) applies where stabilising action is taken:
- within 30 days from the date of issue of the 2017 Bonds; and
- with respect to stabilising action taken by one of the following categories:
- an institutional investor;
- a relevant person (as defined in section 275(2) of the SFA); or
- a person who acquires the 2017 Bonds as principal, provided that the consideration for each transaction is not less than $200,000 (or its equivalent in foreign currency), whether paid in cash or by exchange of securities or other assets.
2) Exemption for the 2035 Bonds (Regulation 3(2)) mirrors the same structure: stabilising action must be taken within 30 days from the date of issue of the 2035 Bonds, and must be undertaken by one of the same categories of persons, again with the $200,000 minimum consideration per transaction requirement where the stabiliser acquires as principal.
Practical legal effect: Sections 197 and 198 of the SFA are the provisions being disapplied. While the extract does not reproduce those sections, the exemption indicates that those provisions would otherwise restrict or prohibit certain conduct that could be characterised as market manipulation or improper dealing. The Regulations carve out stabilising activity that meets the defined criteria, thereby reducing regulatory risk for stabilisation programmes that are structured to be limited, time-bound, and undertaken by appropriate market participants.
How Is This Legislation Structured?
The Regulations are short and structured around three main provisions:
- Regulation 1 sets out the citation and commencement date.
- Regulation 2 provides definitions, including the identification of the specific bond instruments and the definition of “stabilising action,” as well as cross-references to key SFA concepts.
- Regulation 3 contains the exemption, disapplying specified SFA market conduct provisions for stabilising actions in relation to the defined bonds, subject to time limits and participant/consideration conditions.
There are no additional parts or schedules in the extract, reflecting the Regulations’ purpose as a targeted exemption instrument rather than a comprehensive code.
Who Does This Legislation Apply To?
In substance, the exemption is relevant to parties involved in stabilising activity for the specified Indonesian bond issuances—particularly where stabilising action is undertaken by Barclays Bank PLC or its related corporations, as the definition of “stabilising action” is anchored to that group.
However, Regulation 3 also expands the exemption’s usability by allowing stabilising action to be taken by different categories of persons: institutional investors, relevant persons under section 275(2) of the SFA, and persons acquiring as principal (subject to the $200,000 minimum consideration per transaction threshold). This means that, depending on the transaction structure, the exemption may be invoked by different participants in the stabilisation and dealing chain, provided the statutory conditions are met.
Why Is This Legislation Important?
This Regulations is important because it provides a legal safe harbour (in the sense of a statutory exemption) for a specific type of market activity—stabilising bond prices—during a limited period after issuance. For practitioners, the key value lies in reducing uncertainty about whether stabilising purchases or offers to buy could be treated as prohibited conduct under the SFA’s market conduct provisions.
From a compliance perspective, the exemption is highly conditional. The time limit (“within 30 days from the date of issue”) and the participant/consideration requirements mean that stabilisation programmes must be carefully documented and monitored. In particular, where a stabiliser acquires bonds as principal, the $200,000 minimum consideration per transaction requirement (or equivalent in foreign currency) becomes a compliance checkpoint. Practitioners should ensure that dealing records, trade confirmations, and settlement documentation can demonstrate that the threshold is satisfied.
Finally, the Regulations’ specificity—naming the bond instruments by issuer, maturity, coupon, and maximum principal amount—highlights that this is not a general stabilisation regime. It is an exemption tailored to a particular issuance context. Lawyers advising issuers, underwriters, or trading desks should therefore confirm that the bonds in question fall squarely within the defined “2017 Bonds” or “2035 Bonds” categories, and that the stabilising action is within the defined scope of “stabilising action” (including the requirement that it is taken by Barclays Bank PLC or its related corporations).
Related Legislation
- Securities and Futures Act (Cap. 289) — in particular, the market conduct provisions in Sections 197 and 198 (disapplied by this exemption) and the definitions framework including Section 275(2).
- Stabilising Act — referenced in the provided metadata as part of the legislative context for stabilisation concepts (practitioners should verify the exact statutory instrument and its relevance to the SFA framework).
- Futures Act — referenced in the provided metadata; confirm applicability to the bond stabilisation context.
Source Documents
This article provides an overview of the Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Bonds) (No. 8) Regulations 2006 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.