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
- Legislation Type: Subsidiary legislation (SL)
- Authorising Act: Securities and Futures Act (SFA) (in exercise of powers under section 337(1))
- Commencement: 15 March 2006
- Enacting instrument: SL 162/2006
- Status: Current version as at 27 March 2026 (per the legislation record)
- Key Provisions: Section 2 (definitions); Section 3 (exemption)
- Relevant SFA provisions referenced: Sections 197 and 198 (market conduct restrictions); Section 239(1) (definition of “securities”); Section 275(2) (definition of “relevant person”)
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”) creates a targeted exemption from certain market conduct rules in the Securities and Futures Act (SFA). In plain terms, it allows specified parties to take “stabilising action” in relation to two named bond issues without breaching the SFA’s prohibitions on particular forms of market manipulation or improper trading conduct.
Stabilising action is a common feature of securities issuance. When new bonds are issued, market prices can be volatile. Under a stabilisation framework, a stabilising manager may buy (or offer to buy) bonds for a limited period to help stabilise or maintain the market price. However, stabilisation can resemble prohibited conduct if it is not clearly carved out. These Regulations therefore provide a legal “safe harbour” for stabilisation activities, but only for the specific bonds and only within a strict time window and eligibility conditions.
Importantly, the exemption is not a general permission to stabilise any bond. It is bond-specific (for the “2017 Bonds” and “2035 Bonds” issued by the Republic of Indonesia) and party-specific (covering stabilising action taken by Barclays Bank PLC or its related corporations, and allowing stabilisation by certain categories of counterparties). The Regulations also tie the exemption to the SFA’s market conduct provisions by expressly disapplying sections 197 and 198 of the SFA.
What Are the Key Provisions?
1) Citation and commencement (Regulation 1)
The Regulations may be cited as the “Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Bonds) (No. 8) Regulations 2006” and came into operation on 15 March 2006. This matters for practitioners assessing whether stabilisation conduct occurred within the legal framework.
2) Definitions (Regulation 2)
The operative meaning of the Regulations is driven by the definitions. Two bond issues are identified with precision:
- “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 or the 2035 Bonds, in order to stabilise or maintain the market price of those bonds in Singapore or elsewhere.
Finally, “securities” is cross-referenced to the SFA definition in section 239(1), and “relevant person” is cross-referenced to section 275(2). These cross-references are crucial because they determine who qualifies for the exemption.
3) The exemption from SFA sections 197 and 198 (Regulation 3)
The heart of the Regulations is Regulation 3, which provides that sections 197 and 198 of the SFA shall not apply to stabilising action in respect of the specified bonds, subject to strict conditions.
(a) For the 2017 Bonds
The exemption applies to stabilising action taken in respect of the 2017 Bonds within 30 days from the date of issue of the 2017 Bonds, with stabilising action being conducted with any of the following counterparties:
- 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.
(b) For the 2035 Bonds
The same structure applies to the 2035 Bonds: the exemption covers stabilising action taken in respect of the 2035 Bonds within 30 days from the date of issue, with counterparties being an institutional investor, a relevant person, or a principal acquirer meeting the $200,000 minimum consideration threshold per transaction.
Practical implications of the conditions
For practitioners, the exemption is best understood as a three-part test:
- Bond scope: the stabilised instrument must be one of the two named Indonesian bond issues (2017 or 2035).
- Time scope: stabilising action must occur within 30 days from the date of issue.
- Counterparty/transaction scope: the stabilising action must be taken with eligible counterparties, including a principal acquirer only where the consideration per transaction is at least $200,000 (or equivalent).
Because the exemption disapplies sections 197 and 198 of the SFA, the legal effect is that the conduct described as “stabilising action” (meeting the conditions) will not be treated as falling within those specific prohibitions. However, the Regulations do not necessarily immunise conduct from all other legal requirements (for example, other market conduct rules, disclosure obligations, or general regulatory expectations). A careful compliance review should therefore consider the broader SFA framework, not only sections 197 and 198.
How Is This Legislation Structured?
The Regulations are concise and structured around three provisions:
- Regulation 1 (Citation and commencement): sets the name and the start date (15 March 2006).
- Regulation 2 (Definitions): defines the two bond series, the meaning of “stabilising action”, and incorporates cross-references to key SFA definitions.
- Regulation 3 (Exemption): provides the operative exemption by disapplying sections 197 and 198 of the SFA for stabilising action in respect of the specified bonds, within the specified time period, and with specified categories of counterparties/transaction thresholds.
There are no additional parts or schedules in the extract provided, reflecting the targeted nature of the instrument.
Who Does This Legislation Apply To?
The Regulations primarily affect parties involved in stabilisation of the two specified bond issues—particularly the stabilising manager and its counterparties. The definition of “stabilising action” is anchored to actions taken by Barclays Bank PLC (or its related corporations). As a result, the exemption is designed for stabilisation activities carried out by that group.
However, the exemption also depends on who the stabilising action is taken with. It applies where the stabilising action is conducted with an institutional investor, a relevant person (as defined in the SFA), or a principal acquirer meeting the $200,000 minimum consideration threshold per transaction. Therefore, market participants on the other side of stabilisation trades must also fall within the eligibility categories for the exemption to be available.
Why Is This Legislation Important?
From a legal and compliance perspective, this instrument provides a narrow but valuable safe harbour. Stabilisation activities can be scrutinised under market conduct rules because they may influence price formation. By expressly disapplying sections 197 and 198 of the SFA for stabilising action meeting defined conditions, the Regulations reduce uncertainty for issuers, stabilising managers, and counterparties involved in bond issuance.
For practitioners advising on bond offerings, the key value lies in operational clarity: the exemption is limited to two named bond series and a 30-day post-issue window, and it imposes a minimum consideration threshold for principal acquirers. These parameters directly affect trade booking, counterparty selection, and compliance monitoring. Counsel should therefore ensure that stabilisation programmes are documented to demonstrate that trades fall within the defined scope.
Enforcement risk also becomes more manageable. Without an exemption, stabilisation-related trading could be alleged to breach market conduct prohibitions. With the exemption, the legal analysis shifts to whether the factual matrix satisfies the regulatory conditions—particularly the timing, the identity of the bonds, and the eligibility of counterparties/transaction values.
Related Legislation
- Securities and Futures Act (Cap. 289) — in particular:
- Section 337(1) (power to make these Regulations)
- Sections 197 and 198 (market conduct provisions from which the exemption applies)
- Section 239(1) (definition of “securities”)
- Section 275(2) (definition of “relevant person”)
- Futures Act (referenced in the metadata; relevant context may arise depending on how “market conduct” concepts are applied across instruments)
- Stabilising Act (referenced in the metadata; stabilisation frameworks are often supported by specific regulatory instruments)
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.