CORPORATE LAW REFORM ACT 1992 No. 210 of 1992 - SECT 138 Claim by buying client in respect of default by buying dealer

CORPORATE LAW REFORM ACT 1992 No. 210 of 1992 - SECT 138

138. Section 952 of the Corporations Law is amended:

   (a)  by omitting from subparagraph (1)(a)(ii) "and the suspension" and
        substituting ", or the dealer's status as an SCH participant has been
        suspended under the SCH business rules, and that suspension";

   (b)  by inserting after paragraph (1)(a) the following paragraph:

"(aa) if a transfer of the securities concerned pursuant to the purchase would
be an SCH-regulated transfer - the dealer's obligations to the person in
respect of the purchase, in so far as they relate to the transfer of
securities to the person, have not been discharged; and";
(c) by inserting in paragraph (1)(b) "if paragraph (aa) does not apply - "
before "the dealer's";

   (d)  by adding at the end of paragraph (3)(a) "and";

   (e)  by inserting after paragraph (3)(b) the following paragraph:

"(ba) if a transfer of the securities pursuant to the purchase would be an
SCH-regulated transfer - the dealer's obligations to the claimant in respect
of the purchase, in so far as they relate to the transfer of securities to the
claimant, have not been discharged; and";
(f) by inserting in paragraph (3)(c) "if paragraph (ba) does not apply - "
before "the dealer's";

   (g)  by omitting from subsection (3) all the words after "allow the claim";

   (h)  by adding at the end the following subsections:

"(4) If:

   (a)  SEGC allows under subsection (3) a claim in respect of a purchase of
        securities by a dealer on behalf of a person; and

   (b)  a transfer of the securities pursuant to the purchase would be an
        SCH-regulated transfer;
SEGC must, subject to section 952A, transfer to the claimant securities of the
same kind and number as the first-mentioned securities.

"(5) If:

   (a)  SEGC allows under subsection (3) a claim in respect of a purchase of
        securities by a dealer on behalf of a person; and

   (b)  subsection (4) does not apply;
SEGC must, subject to section 953, supply to the claimant settlement documents
in relation to the purchase.".