Statute Details
- Title: Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Notes) (No. 11) Regulations 2006
- Act Code: SFA2001-S118-2006
- Legislation Type: Subsidiary legislation (SL)
- Authorising Act: Securities and Futures Act (Cap. 289)
- Enacting Power: Section 337(1) of the Securities and Futures Act
- Citation: SL 118/2006
- Commencement: 27 February 2006
- Status: Current version as at 27 March 2026 (per provided extract)
- Key Provisions: Section 1 (citation and commencement), Section 2 (definitions), Section 3 (exemption)
What Is This Legislation About?
The Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Notes) (No. 11) Regulations 2006 (“Stabilising Action Exemption Regulations”) creates a targeted exemption from certain market conduct rules under the Securities and Futures Act (the “SFA”) for stabilising activities carried out in relation to a specific bond issue: 3-year floating rate notes due February 2009 issued by the Kingdom of Thailand.
In plain language, the Regulations recognise that, in some debt capital market transactions, market participants may undertake limited buying or offers to buy to help maintain orderly trading conditions and reduce volatility immediately after issuance. However, stabilising conduct can overlap with statutory prohibitions or restrictions on dealing practices. This subsidiary legislation therefore carves out a narrow “safe harbour” so that stabilising action can occur without triggering the relevant prohibitions—provided strict conditions are met.
The scope is intentionally narrow. It is not a general stabilisation regime for all securities. Instead, it is an exemption tailored to (i) a defined set of “Notes”, (ii) a defined set of stabilising actors (Standard Chartered Bank and its related corporations), (iii) a defined stabilisation period (within 30 days from the date of issue), and (iv) a defined set of investor/dealer categories and minimum consideration thresholds.
What Are the Key Provisions?
Section 1 (Citation and commencement) confirms the legal identity of the instrument and its effective date. The Regulations may be cited as the “Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Notes) (No. 11) Regulations 2006” and come into operation on 27 February 2006. For practitioners, this matters when assessing whether stabilising conduct occurred within the regulatory framework applicable at the time of the relevant dealing.
Section 2 (Definitions) is central because the exemption turns on precise definitions. The Regulations define:
- “Notes” as the 3-year floating rate notes due February 2009 issued by the Kingdom of Thailand for a principal amount of up to US$200 million.
- “securities” by reference to the SFA definition in section 239(1). This ensures the exemption operates within the SFA’s broader securities framework.
- “stabilising action” as an action taken in Singapore or elsewhere by Standard Chartered Bank (or any of its related corporations) to buy, or to offer or agree to buy, any of the Notes in order to stabilise or maintain the market price of the Notes in Singapore or elsewhere.
Practically, the definition captures both actual purchases and “offers or agreements to buy”. It also expressly permits stabilising action outside Singapore, while still being within the regulatory definition, provided the action is taken by the specified stabilising entity and relates to the specified Notes.
Section 3 (Exemption) is the operative provision. It states that sections 197 and 198 of the SFA shall not apply to stabilising action taken in respect of any of the Notes, within 30 days from the date of issue, with respect to stabilising action involving certain categories of counterparties.
While the extract does not reproduce the text of sections 197 and 198, the exemption’s structure indicates that those sections impose restrictions or prohibitions on particular dealing or market conduct activities. Section 3 removes the application of those restrictions to the permitted stabilising action, but only if the stabilising action is carried out “with” one of the following categories:
- (a) an institutional investor
- (b) a “relevant person” as defined in section 275(2) of the SFA
- (c) a person who acquires the Notes as principal, provided that the consideration for the acquisition is not less than $200,000 (or its equivalent in a foreign currency) for each transaction, whether paid in cash or by exchange of securities or other assets
Several practical points flow from this:
- Time-limited safe harbour: The exemption applies only if the stabilising action occurs within 30 days from the date of issue. Conduct outside that window would fall back to the general SFA regime.
- Counterparty limitation: The exemption is not open-ended. It is conditioned on the stabilising action being taken with the specified categories of persons. A stabilising trade with a counterparty that does not fit (a), (b), or (c) would not be covered.
- Minimum consideration threshold for principal acquirers: For persons acquiring as principal, the exemption requires at least $200,000 per transaction (or equivalent). This threshold applies regardless of whether consideration is paid in cash or via exchange of securities or other assets.
- Defined stabiliser: Because “stabilising action” is defined as action by Standard Chartered Bank or its related corporations, the exemption is not available to other dealers unless they fall within that defined stabiliser group.
Making and signature: The Regulations were made on 22 February 2006 by the Monetary Authority of Singapore (MAS), signed by Heng Swee Keat, Managing Director. For legal work, this confirms the instrument’s formal validity and the regulator responsible for its issuance.
How Is This Legislation Structured?
The Regulations are short and comprise three substantive provisions:
- Section 1 sets out the citation and commencement.
- Section 2 provides definitions that determine the scope of the exemption, including what counts as the “Notes” and what counts as “stabilising action”.
- Section 3 creates the exemption from the application of sections 197 and 198 of the SFA, subject to a 30-day period and specified counterparty categories and thresholds.
There are no additional parts or complex schedules in the extract. The instrument is designed to function as a targeted regulatory carve-out rather than a comprehensive stabilisation framework.
Who Does This Legislation Apply To?
The exemption is relevant primarily to Standard Chartered Bank and its related corporations when they undertake stabilising activities in relation to the defined Kingdom of Thailand 3-year floating rate notes due February 2009. The Regulations also matter to other parties indirectly—such as institutional investors, “relevant persons”, and principal acquirers—because the exemption’s availability depends on the counterparty category involved in the stabilising dealings.
In addition, the exemption is conditional on the stabilising action being taken within 30 days from the date of issue. Therefore, even where the stabiliser and the Notes match, the exemption will not apply to stabilising conduct outside that time window. Practitioners should also ensure that the counterparty fits one of the enumerated categories, and where the counterparty is a principal acquirer, that the $200,000 minimum consideration per transaction requirement is satisfied.
Why Is This Legislation Important?
For market participants, the Regulations provide regulatory certainty in a common debt issuance practice. Stabilisation can support liquidity and reduce disorderly price movements during the early trading period after issuance. Without an exemption, stabilising purchases or offers to buy may be difficult to execute safely due to potential overlap with statutory market conduct restrictions.
From a compliance perspective, the Regulations illustrate how Singapore’s market conduct framework can accommodate legitimate market practices through narrow, transaction-specific exemptions. The exemption is not a blanket permission; it is a carefully bounded safe harbour that requires adherence to defined actors, securities, timing, and counterparty conditions.
For practitioners advising on documentation, dealing instructions, and post-trade compliance, the key practical impact is that stabilising activity can be structured to fall within the exemption—thereby reducing the risk of regulatory breach of sections 197 and 198 of the SFA. However, the same narrowness means that careful factual verification is essential: confirming the identity and terms of the Notes, the stabiliser entity, the dealing dates, the nature of the counterparty, and (where relevant) the minimum consideration threshold.
Related Legislation
- Securities and Futures Act (Cap. 289) — particularly sections 197, 198, 239(1), 275(2), and the authorising provision 337(1).
- Futures Act (as referenced in the provided metadata timeline context).
- Stabilising Act (as referenced in the provided metadata timeline context).
- Timeline / Legislation timeline (for version control and amendment history, as indicated in the provided extract).
Source Documents
This article provides an overview of the Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Notes) (No. 11) Regulations 2006 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.