Plain language law

New Zealand law explained for everyone

Deposit Takers Act 2023

Crisis management and resolution - Conduct of resolution - Relationship between resolution and other legislation and processes

338: Prior insolvency process must cease

You could also call this:

"Stop other processes when fixing a troubled deposit taker"

Illustration for Deposit Takers Act 2023

You are dealing with a licensed deposit taker that is in trouble. If it is already being wound up or is in liquidation, receivership, or voluntary administration, these processes must stop while it is in resolution. The person in charge of these processes is no longer in charge. If the resolution ends because of an Order in Council made under section 282(1), the winding up, liquidation, receivership, or voluntary administration can start again. This will happen unless the order says something different. The order can have its own terms and conditions. If these processes start again, the person named in the order becomes the liquidator, receiver, or administrator once more. This is what happens when the winding up, liquidation, receivership, or voluntary administration revives.

This text is automatically generated. It might be out of date or be missing some parts. Find out more about how we do this.

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS535234.

This page was last updated on — View changes

Topics:
Money and consumer rights > Banking and loansBusiness > Industry rules
Previous

337: Bank, resolution manager, and other persons are not directors under any legislation, or

"Bank and others are not directors when doing special jobs under the law"

Next

339: Continuation of resolution if restored, or

"What happens if a removed bank is put back on the register while being resolved"

Part 7Crisis management and resolution
Conduct of resolution: Relationship between resolution and other legislation and processes

338Prior insolvency process must cease

  1. If a licensed deposit taker (A) enters resolution and A is already being wound up or is already in liquidation, receivership, or voluntary administration,—

  2. the winding up, liquidation, receivership, or voluntary administration must cease for so long as A continues to be in resolution; and
    1. the person appointed as liquidator, receiver, or administrator is discharged.

      1. If an Order in Council made under section 282(1) ends the resolution, the winding up, liquidation, receivership, or voluntary administration of A revives as if it had not ceased by reason of this section unless the order provides otherwise.

      2. Subsection (2) applies subject to the terms and conditions specified in the order.

      3. If the winding up, liquidation, receivership, or voluntary administration revives, the person specified in the order as such becomes, or resumes as, the liquidator, receiver, or administrator of A for the time being.

      Compare