Statute Details
- Title: Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Notes) (No. 53) Regulations 2005
- Act Code: SFA2001-S754-2005
- Type: Subsidiary Legislation (SL)
- Authorising Act: Securities and Futures Act (Cap. 289)
- Enacting power: Section 337(1) of the Securities and Futures Act
- Commencement: 1 December 2005
- Regulatory status: Current version as at 27 March 2026 (per the legislation timeline)
- Key provisions: Section 1 (citation and commencement); Section 2 (definitions); Section 3 (exemption); Schedule (relevant subsidiaries)
- Legislative focus: Exemption from market conduct restrictions for “stabilising action” in relation to specified notes
What Is This Legislation About?
The Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Notes) (No. 53) Regulations 2005 (“Stabilising Exemption Regulations”) is a targeted regulatory instrument made under the Securities and Futures Act (the “SFA”). In plain terms, it creates a narrow exemption that allows certain market participants to take “stabilising action” in connection with specified bond/notes issuances—without being treated as breaching particular market conduct provisions in the SFA.
Stabilising action is a common feature of capital markets transactions. During or shortly after an issuance, an underwriter or related dealer may buy (or offer to buy) securities to help maintain an orderly market and reduce excessive price volatility. However, because such activity can affect price formation, the SFA contains restrictions designed to prevent manipulative or misleading market conduct. This subsidiary legislation carves out an exemption for stabilising activity, but only if strict conditions are met.
Critically, the exemption is not general. It applies only to stabilising action relating to three specific note programmes: “2013 Floating Rate Notes”, “2013 Fixed Rate Notes”, and “2015 Fixed Rate Notes”. It also applies only within a defined time window after issue (30 days) and only when stabilising is carried out by specified persons and counterparties (institutional investors, certain “relevant persons”, or qualifying principal purchasers meeting a minimum consideration threshold).
What Are the Key Provisions?
1. Citation and commencement (Section 1)
Section 1 provides the short title and states that the Regulations come into operation on 1 December 2005. For practitioners, this matters mainly for determining whether the exemption was available for stabilising activities undertaken after commencement and for aligning transaction timelines with regulatory compliance.
2. Definitions (Section 2)
Section 2 is the backbone of the Regulations because it defines the scope of the exemption. The definitions identify (i) the specific notes covered, (ii) who may take stabilising action, and (iii) what “stabilising action” means.
The Regulations define:
- “2013 Floating Rate Notes”: 7-year 6-month floating rate guaranteed senior notes due June 2013, issued by Avago Technologies Finance Pte. Ltd., Avago Technologies U.S. Inc., and Avago Technologies Wireless (U.S.A.) Manufacturing Inc., up to US$500 million, guaranteed by relevant subsidiaries.
- “2013 Fixed Rate Notes”: 8-year fixed rate guaranteed senior notes due December 2013, issued by the same group, up to US$800 million, guaranteed by relevant subsidiaries.
- “2015 Fixed Rate Notes”: 10-year fixed rate guaranteed senior subordinated notes due December 2015, issued by the same group, up to US$600 million, guaranteed by relevant subsidiaries.
- “relevant subsidiaries”: entities listed in the Schedule (not reproduced in the extract, but essential for identifying the guarantee structure).
- “stabilising action”: an action taken in Singapore or elsewhere by Lehman Brothers Inc., Citigroup Global Markets Singapore Pte. Ltd., and Credit Suisse First Boston (Singapore) Limited (or their related corporations) to buy, or to offer or agree to buy, any of the specified notes in order to stabilise or maintain market price in Singapore or elsewhere.
From a compliance perspective, the definition is unusually specific: it ties stabilising action to particular firms and to particular note issuances. It also clarifies that stabilising action may occur in Singapore or elsewhere, which is important for cross-border dealing arrangements and for determining whether overseas trading desks fall within Singapore regulatory reach.
3. The exemption from Sections 197 and 198 of the SFA (Section 3)
Section 3 is the operative provision. It states that Sections 197 and 198 of the SFA shall not apply to stabilising action taken in respect of the specified notes, subject to conditions.
Time window: For each note category, the exemption applies only to stabilising action taken within 30 days from the date of issue of the relevant notes. This is a hard temporal limit. Any stabilising activity outside the 30-day period would not benefit from the exemption and could expose the stabilising party to the underlying SFA restrictions.
Counterparty/participant conditions: For each note category, stabilising action must be taken with one of the following counterparties:
- (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, but only if the consideration 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.
Note: The $200,000 threshold is transaction-based (“for each transaction”), and it is satisfied whether the consideration is cash or non-cash (including exchange of securities or other assets). This flexibility is practically significant for structured deals, where consideration may be partly in kind.
4. Separate exemptions for each note series (Sections 3(1)–(3))
Although the conditions are materially similar across the three note series, the Regulations set out the exemption separately for each category. This drafting approach helps practitioners confirm that the exemption is series-specific and does not automatically extend to other issuances, even if issued by the same group.
How Is This Legislation Structured?
The Regulations are structured in a conventional format for Singapore subsidiary legislation:
- Section 1 provides the citation and commencement.
- Section 2 contains definitions that determine the scope of the exemption, including the precise note descriptions and the meaning of “stabilising action”.
- Section 3 sets out the exemption mechanism, specifying that Sections 197 and 198 of the SFA do not apply to stabilising action meeting the conditions (time window and eligible counterparties) for each note series.
- The Schedule lists the “relevant subsidiaries” that guarantee the notes. While the extract does not reproduce the Schedule text, it is essential for verifying that the notes fall within the defined categories.
For legal work, this structure means that a practitioner typically starts with Section 2 (to confirm the exact notes and stabilising actors), then applies Section 3 (to confirm the 30-day period and eligible counterparties). The Schedule is then used to confirm the guarantee chain.
Who Does This Legislation Apply To?
The Regulations apply to stabilising action in relation to the defined notes, but only when the stabilising action is taken by the persons identified in the definition of “stabilising action”—namely Lehman Brothers Inc., Citigroup Global Markets Singapore Pte. Ltd., and Credit Suisse First Boston (Singapore) Limited (or their related corporations). This is a key limitation: the exemption is not available to all market participants who might wish to stabilise.
In addition, the exemption is conditioned on the identity and status of the counterparty to the stabilising trades. Stabilising action must be taken with an institutional investor, a relevant person (under Section 275(2) of the SFA), or a principal acquirer meeting the $200,000 per transaction minimum consideration threshold (or its foreign currency equivalent), including non-cash consideration.
Practically, this means that compliance teams must map both sides of the transaction: (i) whether the stabilising firm is within the defined stabilising actors, and (ii) whether the counterparty qualifies under the SFA definitions or meets the minimum consideration threshold.
Why Is This Legislation Important?
This subsidiary legislation is important because it reconciles two competing regulatory objectives: (1) allowing legitimate market stabilisation practices that support orderly trading after an issuance, and (2) preventing manipulative conduct that could undermine market integrity. By exempting stabilising action from specific SFA provisions (Sections 197 and 198), the Regulations provide legal certainty for stabilisation activities that meet defined conditions.
For practitioners advising issuers, underwriters, or dealers, the Regulations function as a compliance “gatekeeper”. If stabilising activity is planned for the specified notes, counsel must ensure that the activity is within the 30-day post-issue period and that trades are executed with eligible counterparties. Failure to meet these conditions could mean that the exemption does not apply, leaving the stabilising party exposed to enforcement risk under the underlying SFA market conduct rules.
From an enforcement and audit perspective, the specificity of the definitions (particular note series, particular stabilising firms, and particular counterparty categories) creates a clear checklist for documentation. Transaction records should ideally evidence: the date of issue, the timing of stabilising trades, the identity of the stabilising firm, and the counterparty classification or consideration amount.
Finally, the Regulations’ cross-border language (“in Singapore or elsewhere”) is a reminder that stabilisation desks operating outside Singapore may still need to consider Singapore regulatory compliance when the stabilisation relates to notes and market price in Singapore.
Related Legislation
- Securities and Futures Act (Cap. 289) — in particular Sections 197, 198, 239(1) (definition of “securities”), and 275(2) (definition of “relevant person”), and the authorising provision section 337(1).
- Futures Act (as referenced in the provided metadata context)
- Stabilising Act (as referenced in the provided metadata context)
- Timeline / Legislation timeline (for version verification; the extract indicates the current version as at 27 March 2026)
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. 53) Regulations 2005 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.