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34 2009

National Asset Management Agency Act 2009

PART 8

Relationship between NAMA and Participating Institutions

Definition (Part 8).

128 .— In this Part “ relevant service” includes management, administration, restructuring and enforcement services in relation to bank assets, including any activity specified as part of a direction by NAMA or an arrangement or agreement to which NAMA or a NAMA group entity is a party.

Participating institutions to act in utmost good faith.

129 .— (1) A participating institution shall act in utmost good faith at all times in its dealings with the Minister, NAMA, NAMA group entities, their agents, the expert reviewer and the valuation panel pursuant to this Act.

(2) A participating institution shall inform the Minister, NAMA and any NAMA group entity concerned of any fact or thing that may impede—

(a) the achievement of the purposes of this Act,

(b) the performance by the Minister of his or her functions, or NAMA of its functions, under this Act, or

(c) the fulfilment by the participating institution of its obligations under this Act.

(3) If a participating institution identifies such an impediment the participating institution shall take all reasonable steps to address the impediment in a manner that best furthers the achievement of the purposes of the Act.

Breach of statutory requirements.

130 .— A participating institution that fails to comply with any obligation under this Act is liable to NAMA and any NAMA group entity concerned in damages in addition to any other consequence of the failure under this Act.

Servicing of acquired bank assets by participating institutions.

131 .— (1) For the purposes of this section, in the event of a conflict between—

(a) a direction by NAMA, and

(b) a term of an arrangement or agreement to which NAMA or a NAMA group entity is a party in relation to the provision of a relevant service,

then a direction by NAMA, a term of such an arrangement and a term of such an agreement shall have effect in that order of priority.

(2) The participating institution from which NAMA or a NAMA group entity has acquired or intends to acquire a bank asset shall, until NAMA or the NAMA group entity directs otherwise, continue to perform relevant services in respect of the bank asset. NAMA or the NAMA group entity shall reimburse the participating institution in respect of the agreed cost of such service.

(3) NAMA may direct a participating institution to perform a relevant service in connection with a bank asset that NAMA or a NAMA group entity has acquired or intends to acquire from that participating institution or any other participating institution. NAMA or the NAMA group entity shall reimburse the participating institution for the agreed cost of such service.

(4) A direction under subsection (3)

(a) may require a participating institution to enter into an arrangement or agreement that includes an obligation to provide access for and permit the use by NAMA or a NAMA group entity of facilities, books, records and systems, and

(b) may require a participating institution concerned to provide a relevant service for the benefit of a NAMA group entity.

(5) NAMA may at any time amend, suspend or revoke a direction pursuant to this section.

(6) A participating institution shall—

(a) comply with a direction, and any amendment, suspension or revocation of a direction, pursuant to this section, and

(b) ensure that any subsidiary to which such a direction extends also complies with it.

(7) A participating institution shall ensure that it and each of its subsidiaries—

(a) obtains and maintains in effect any authorisation, consent, approval, resolution, licence, exemption, filing, notarisation or registration required (in the State or in any other place) in connection with the provision of the services required by a direction pursuant to this section, and

(b) complies with the terms and conditions of, and any requirement of or under any law in relation to, any such authorisation, consent, approval, resolution, licence, exemption, filing, notarisation or registration.

(8) NAMA may give a debtor, associated debtor, guarantor or surety in relation to a bank asset in which NAMA or a NAMA group entity has acquired an interest, or any other person, notice of any direction given pursuant to this section. However, NAMA and the NAMA group entity are not liable to any debtor, associated debtor, guarantor or surety or any other person for failure to give such a notice.

(9) Any receivable or other amount received or recovered by a participating institution pursuant to the performance by it of a relevant service shall be held by that participating institution on trust absolutely for and to the order of NAMA or a NAMA group entity, as the case may be, and any amount so held shall be accounted for to NAMA or the NAMA group entity as NAMA from time to time directs. A trust constituted by this subsection—

(a) does not form part of the assets of the participating institution whether for the purposes of laws generally applicable to winding up, reorganisations, liquidations or otherwise,

(b) is effective for all purposes, and

(c) shall not be taken to constitute or create a security.

Other servicing arrangements.

132 .— (1) Where in relation to an acquired bank asset NAMA or a NAMA group entity has arranged with a service provider other than the participating institution from which the bank asset was acquired for the provision of relevant services in respect of an acquired bank asset, then—

(a) the terms of the bank asset shall be taken to require each debtor, associated debtor, guarantor or surety in respect of a bank asset to deal with the service provider concerned,

(b) NAMA or the NAMA group entity may give such a debtor, associated debtor, guarantor or surety notice of any arrangement for the provision of a relevant service in respect of that bank asset, and

(c) NAMA and the NAMA group entity concerned are not liable to any such debtor, associated debtor, guarantor or surety or any other person for failure to give such a notice.

(2) Where NAMA or a NAMA group entity has arranged with a service provider for the provision of relevant services in respect of a bank asset that has been acquired or is to be acquired by NAMA or the NAMA group entity, the participating institution from which the bank asset is to be or was acquired shall do all such acts or things that NAMA or the NAMA group entity directs to facilitate the provision by the service provider of those relevant services.

NAMA may give directions about certain bank assets not acquired.

133 .— (1) Where NAMA or a NAMA group entity has acquired a bank asset from a participating institution NAMA may, for the furtherance of the achievement of its purposes under this Act, direct the participating institution to deal in a specified way with any part of the bank asset not acquired, being a way in which the participating institution may lawfully deal, or has the authority to deal, with the bank asset or part.

(2) A participating institution shall comply with a direction by NAMA under subsection (1).

Additional payment on servicing of acquired bank assets.

134 .— (1) With the consent of the Minister, NAMA or a NAMA group entity may agree with a participating institution on an arrangement in relation to the servicing of acquired bank assets.

(2) Without prejudice to the generality of subsection (1), an arrangement referred to in that subsection may provide for—

(a) an adjustment to the total portfolio acquisition value,

(b) performance fees, and the reimbursement of costs and expenses, on terms approved by the Minister, or

(c) any combination of the things mentioned in paragraphs (a) and (b).

Participating institutions to indemnify NAMA.

135 .— (1) If NAMA so directs, a participating institution shall indemnify NAMA or a NAMA group entity and each of their officers against any liability or loss (however arising, and regardless of any default on the part of NAMA or a NAMA group entity)—

(a) arising from any error, omission or misstatement in any information, explanation, instrument, document, record, book or certificate provided to NAMA or the NAMA group entity by or on behalf of the participating institution,

(b) in respect of any claim, award, payment or damages which NAMA or the NAMA group entity becomes liable to pay to any person by reason of the operation of the European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (S.I. No. 131 of 2003) where the liability arises in connection with a cause of action accruing before the relevant acquisition date (or any proportion of the liability or loss is attributable to a period before the relevant acquisition date) including any claim made by or on behalf of such a person that relates to an act or omission of the participating institution in connection with that person’s employment before the acquisition date, and

(c) in respect of any redundancy payment, or any other severance payment, paid by NAMA or the NAMA group entity, or that NAMA or the NAMA group entity is ordered to pay, to any person whose employment transfers to NAMA or the NAMA group entity by reason of the operation of those Regulations and whose employment is terminated by NAMA or the NAMA group entity by reason of redundancy.

(2) Where the Court determines ownership of a bank asset in favour of a third party and as a result NAMA or a NAMA group entity is obliged to transfer the bank asset to the third party or pay damages in lieu, the participating institution shall indemnify NAMA or the NAMA group entity against that liability and all losses suffered by it.

(3) The Court and any other court or tribunal in which legal proceedings are brought in respect of a matter referred to in subsection (1) shall not make NAMA or a NAMA group entity a party to the proceedings in any capacity where the liability is that of the participating institution.

(4) If NAMA or a NAMA group entity so directs, and without prejudice to section 105 , a participating institution shall indemnify NAMA or the NAMA group entity and its officers against any liability or loss in respect of a legal or equitable wrong referred to in that section.

Participating institutions to be agent of subsidiaries, etc.

136 .— (1) A participating institution is for all purposes of this Act the agent of each other legal entity in its group with full power to bind each other such entity.

(2) The service of a notice on, or any communication with, a participating institution referred to in subsection (1) is for all purposes of this Act effective as service of the notice on, or communication with, any other entity in the participating institution’s group.

(3) In this section “ group ”, in relation to a participating institution, means—

(a) the participating institution,

(b) any subsidiary of the participating institution, and

(c) any entity of which the participating institution is a subsidiary.