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37 1998

INVESTOR COMPENSATION ACT, 1998

SECOND SCHEDULE

Supplementary Provision in Relation to a Direction by a Supervisory Authority under Section 27

Section 27 .

1. In this Schedule, a reference to an investment firm includes reference to directors and those responsible for the management of an investment firm.

2. A supervisory authority may revoke a direction given under section 27 of this Act unless an order under section 28 of this Act has been made by the Court in respect of the direction.

3. An investment firm to which a direction has been given under section 27 of this Act may apply to the Court for, and the Court may grant, an order varying or setting aside the direction.

4. Where a supervisory authority applies to the Court for an order confirming a direction under section 27 of this Act, the Court may grant an order confirming the direction or setting it aside, or confirming it and extending the period of its operation for such time not exceeding the period of 12 months from the date the direction commenced to have effect, as the Court may, having regard to the circumstances, consider appropriate.

5. In addition to, or in lieu of, an order under section 28 , the Court may make such other order in the case as may appear to it necessary, including an order directing any person who holds money or other assets for or on behalf of the investment firm or client of such investment business firm, or a specified person, not to dispose of any of those assets except on such conditions and in such circumstances as are specified in the order.

6. A direction which has been confirmed by the Court shall terminate:

(a) at the end of the period of operation specified by the Court,

(b) on the making by the Court of an order for termination on the application of the supervisory authority,

(c) on the making of a winding-up order in respect of the investment firm or, where an investment firm is constituted as an unincorporated body of persons, a dissolution order, or where an investment firm is a sole trader, an adjudication of bankruptcy,

(d) on the making by the Court of an order for termination where the Court considers that the circumstances that gave rise to the direction have ceased to exist and that it would be unjust and inequitable not to make the order,

whichever first occurs.

7. The Court may by order revoke or amend an order made by it under paragraph 4.

8. Where a direction is given by the supervisory authority in accordance with section 27

(a) the investment firm to which the direction has been given shall take all necessary steps to secure that its assets or client or investor assets, wherever held, are not depleted without the prior authorisation of the supervisory authority, and

(b) the supervisory authority may direct a credit institution or any institution exempt under section 7 of the Central Bank Act, 1971 , or any other financial institution which holds an account of any description of the investment firm including holdings of investment instruments of the investment firm to which the direction has been given, to suspend the making of payments or other transaction from the account without the prior authorisation of the supervisory authority.