Singapore legislation

Section 440

of Insolvency, Restructuring and Dissolution Act 2018

Section 440

Certain contractual rights limited

(1)

No person may, at any time after the commencement, and before the conclusion, of any proceedings by a company —

(a)

terminate or amend, or claim an accelerated payment or forfeiture of the term under, any agreement (including a security agreement) with the company; or

(b)

terminate or modify any right or obligation under any agreement (including a security agreement) with the company,by reason only that the proceedings are commenced or that the company is insolvent.

(2)

Nothing in this section is to be construed as —

(a)

prohibiting a person from requiring payments to be made in cash for goods, services, use of leased property or other valuable consideration provided after the commencement of the proceedings; or

(b)

requiring the further advance of money or credit.

(3)

Any provision in an agreement that has the effect of providing for, or permitting, anything that, in substance, is contrary to this section is of no force or effect.

(4)

On an application by a party to an agreement, the Court may declare that this section does not apply, or applies only to the extent declared by the Court, if the applicant satisfies the Court that the operation of this section would likely cause the applicant significant financial hardship.

(5)

Subsection (1) does not apply in respect of any legal right under —

(a)

any eligible financial contract as may be prescribed; (b)any contract that is a licence, permit or approval issued by the Government or a statutory body; (c)any contract that is likely to affect the national interest, or economic interest, of Singapore, as may be prescribed; (d)any commercial charter of a ship; (e)any agreement within the meaning of the Convention as defined in section 2(1) of the International Interests in Aircraft Equipment Act 2009; or

(f)

any agreement that is the subject of a treaty to which Singapore is party, as may be prescribed.

(6)

In this section —

Definition

“company” means any corporation liable to be wound up under this Act, but excludes such company or class of companies as the Minister may by order in the Gazette prescribe;

Definition

“essential service” has the meaning given by section 2(1) of the Cybersecurity Act 2018;

Definition

“national interest” includes national defence, national security, public security and the maintenance of any essential service;

Definition

“proceedings” means any proceedings arising from —

(a)

any application under section 210(1) of the Companies Act 1967 for the approval of the Court in relation to any compromise or arrangement between a company and its creditors or any class of those creditors;

(b)

any application under section 71 for the approval of the Court in relation to any compromise or arrangement;

(c)

any application for an order under section 64 or 65; (d)any application for a judicial management order under section 91; or

(e)

the lodgment of a written notice of the appointment of an interim judicial manager under section 94(5)(a).

Read in full context — Insolvency, Restructuring and Dissolution Act 2018 →