Statute Details
- Title: Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Notes) (No. 9) Regulations 2005
- Act Code: SFA2001-S95-2005
- Type: Subsidiary Legislation (SL)
- Authorising Act: Securities and Futures Act (Cap. 289)
- Enacting power: Section 337(1) of the Securities and Futures Act
- Commencement: 23 February 2005
- Legislation status: Current version as at 27 March 2026 (per legislation timeline)
- Key provisions: Section 1 (Citation and commencement); Section 2 (Definitions); Section 3 (Exemption)
- Regulatory authority: Monetary Authority of Singapore (MAS)
- Instrument number: SL 95/2005
What Is This Legislation About?
The Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Notes) (No. 9) Regulations 2005 (“Stabilising Action (Notes) Regulations”) is a targeted regulatory instrument made under the Securities and Futures Act (SFA). In plain terms, it creates a limited exemption from certain market conduct rules that would otherwise restrict or regulate stabilising activities in connection with a specific issuance of notes.
Stabilisation is a common market practice in securities offerings. When new debt securities begin trading, issuers and their financial intermediaries may take steps intended to reduce volatility and support orderly trading. However, stabilisation can also raise concerns about market manipulation or unfair dealing. The SFA therefore contains provisions (notably sections 197 and 198) that regulate or prohibit certain conduct that could distort market prices.
This subsidiary legislation addresses that tension by carving out an exemption for stabilising action relating to a particular set of notes—defined with precision in the Regulations—and within a defined timeframe. The exemption is not general: it is limited to stabilising actions taken in respect of the specified notes, within 30 days from the date of issue, and only by specified categories of counterparties/investors.
What Are the Key Provisions?
Section 1 (Citation and commencement) provides the short title and the date the Regulations come into operation. The Regulations may be cited as the “Securities and Futures (Market Conduct) (Exemption for Stabilising Action in respect of Dealings in Notes) (No. 9) Regulations 2005” and they commenced on 23 February 2005. For practitioners, the commencement date matters because the exemption can only apply to stabilising actions taken after the Regulations are in force (subject to how the SFA and the stabilisation timeline are interpreted in practice).
Section 2 (Definitions) is central because it defines both the instrument and the conduct that the exemption covers.
First, “Notes” are defined as the 3-year US$ fixed rate notes due February 2008 issued by Rizal Commercial Banking Corporation for a principal amount of up to US$300 million. This definition is highly specific: it ties the exemption to a particular issuer, tenor, currency, interest structure, maturity, and issuance size ceiling.
Second, “stabilising action” is defined as an action taken in Singapore or elsewhere by UBS AG Singapore Branch or any of its related corporations. The action must be 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. This definition is important for compliance: it indicates that the exemption is meant to cover stabilisation through purchase commitments and related offers/agreements, and it is tied to the purpose of stabilising or maintaining market price.
Section 3 (Exemption) contains the operative relief. It states that sections 197 and 198 of the Act shall not apply to any stabilising action taken in respect of any of the Notes, within 30 days from the date of issue, with respect to stabilising actions involving either:
- (a) a person referred to in section 274 of the Act; or
- (b) a sophisticated investor as defined in section 275(2) of the Act.
In practical terms, the exemption is conditional on both time and counterparty category. Even if a party is acting as a stabiliser for the defined Notes, the exemption does not automatically apply to all dealings. It applies only where the stabilising action is taken within the 30-day post-issue window and where the dealings are with the specified categories of persons (section 274 persons) or sophisticated investors.
For a lawyer advising a stabilisation manager or dealing desk, the key compliance questions are therefore: (1) Are the notes within the defined “Notes” description? (2) Is the activity truly “stabilising action” as defined—i.e., purchases or offers/agreements to buy, for the purpose of stabilising or maintaining price? (3) Is the stabilisation within 30 days from the date of issue? (4) Are the counterparties within section 274 or sophisticated investor status? If any answer is “no,” the exemption may not apply and the underlying SFA provisions (sections 197 and 198) could become relevant.
How Is This Legislation Structured?
The Regulations are concise and structured around three provisions.
Section 1 deals with citation and commencement. Section 2 provides definitions that narrow the scope of the exemption by identifying the Notes and the stabilising conduct and actor. Section 3 sets out the exemption itself, specifying which SFA provisions are disapplied (sections 197 and 198), the timeframe (30 days from issue), and the permitted counterparty categories (section 274 persons and sophisticated investors).
There are no additional parts or complex schedules in the extract provided. The drafting approach is typical of targeted MAS exemptions: define the instrument and conduct precisely, then disapply specified statutory provisions subject to narrow conditions.
Who Does This Legislation Apply To?
The Regulations apply to stabilising actions taken in respect of the defined Notes. Although the exemption is framed as an exemption from the application of sections 197 and 198 of the SFA, it is effectively directed at the parties who would otherwise engage in stabilisation and therefore need certainty that their conduct is not caught by the market conduct restrictions.
As a matter of definition, “stabilising action” must be taken by UBS AG Singapore Branch or its related corporations. This means the exemption is not intended for all market participants; it is tied to the stabilising entity identified in the Regulations. Additionally, the exemption only operates for stabilising dealings with persons falling within section 274 of the SFA or with sophisticated investors under section 275(2). Accordingly, counterparties and investor classification are critical for determining whether the exemption is available.
Why Is This Legislation Important?
This Regulations matters because it provides legal certainty for stabilisation activity in a specific cross-border debt issuance. Without an exemption, stabilisation purchases and related commitments could risk breaching the SFA’s market conduct rules. By disapplying sections 197 and 198 for the defined Notes and within the defined conditions, MAS enables orderly market practices while maintaining a regulatory boundary.
From a practitioner’s perspective, the most significant features are the narrow scope and the compliance gating conditions. The exemption is not a blanket permission to stabilise any security. It is limited to: (i) a particular issuer and note structure; (ii) stabilising actions by a specified stabiliser (UBS AG Singapore Branch and related corporations); (iii) a strict 30-day window from the date of issue; and (iv) dealings with specified categories of persons (section 274 persons) or sophisticated investors.
In enforcement and risk management terms, these limitations mean that documentation and process controls are essential. Legal teams should ensure that stabilisation programmes, dealing records, and counterparty eligibility checks are aligned with the statutory definitions. For example, the “sophisticated investor” concept is a defined legal status under the SFA; therefore, firms should confirm investor qualification and retain evidence. Similarly, the “30 days from the date of issue” requirement requires accurate identification of the issue date and careful monitoring of dealing dates.
Finally, the Regulations illustrate how MAS uses subsidiary legislation to tailor exemptions to particular transactions. For market participants, this is a reminder that stabilisation legality may depend on transaction-specific regulatory instruments, not only on general market conduct principles.
Related Legislation
- Securities and Futures Act (Cap. 289) — particularly sections 197, 198, 274, 275(2), and the exemption-making power in section 337(1).
- Futures Act (as referenced in the provided metadata context)
- Stabilising Act (as referenced in the provided metadata context)
- Legislation Timeline (for version control and current status 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. 9) Regulations 2005 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.