MISCELLANEOUSCentral

Section 11 of The Bilateral Netting of Qualified Financial Contracts Act, 2020

(1)If any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by order, published in the Official Gazette, make such provisions not inconsistent with the provisions of this Act as may appear to it to be necessary or expedient for removing the difficulty: Provided that no order shall be made after the expiry of a period of three years from the date of commencement of this Act.
(2)Every order made under this section shall be laid, as soon as may be after it is made, before each House of Parliament.

Summary

The Central Government has the power to issue orders to remove difficulties in implementing this Act.
Any order to remove difficulties must be published in the Official Gazette.
The orders issued under this power must be completely consistent with the existing provisions of this Act.
This power is temporary and expires exactly three years after the commencement of the Act.
Every order made under this section must be laid before each House of Parliament as soon as possible.

Practical examples

1On November 5, 2021, just one year after the Act commenced, a minor procedural difficulty arises regarding how banks register qualified contracts. The Central Government publishes an order in the Official Gazette to clarify the registration process. Under Section 11(1), this order successfully resolves the operational difficulty.

2On December 10, 2025, which is more than five years after the Act's commencement on October 1, 2020, a difficulty arises concerning the timing of close-out notices. The Central Government wants to issue an order to resolve this. However, under Section 11(1), they cannot issue any order because the three-year limit from the commencement date has already expired.

FAQ

1. Who has the power to issue orders to remove difficulties in giving effect to this Act?

The Central Government has the power to issue such orders.

2. Where must an order to remove difficulties be published?

It must be published in the Official Gazette.

3. What is the strict deadline for making an order under Section 11?

No order can be made after the expiry of a period of three years from the date of commencement of this Act.

4. What must the Central Government do after making an order under Section 11?

Every order must be laid, as soon as may be after it is made, before each House of Parliament.

Test yourself

Q1.Under Section 11(1), where must an order to remove difficulties be published?

Q2.What is the strict time limit for the Central Government to make an order under Section 11?

Q3.Any order made to remove difficulties under Section 11 must be:

Q4.Under Section 11(2), what must the Central Government do after making an order?

Q5.If a difficulty arises four years after the commencement of the Act, can the Central Government use Section 11 to solve it?

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