—(1) This section shall have effect with respect to the application of a designated clearing house of property provided as market collateral (referred to in this section as the property).
(2) The property may be applied in accordance with the business or default rules of a designated clearing house so far as it is necessary for it to be so applied notwithstanding —
any prior equitable interest or right, or any right or remedy arising from a breach of fiduciary duty, unless the designated clearing house had actual notice of the interest, right or breach of duty (other than any interest or right arising from the situation referred to in paragraph (b)), as the case may be, at the time the property was provided as market collateral; or
that the property is deposited by the designated clearing house in a trust account held for the benefit of a participant.
(3) No right or remedy arising subsequent to the provision of the property as market collateral may be enforced to prevent, or interfere with, the application of the property by the designated clearing house in accordance with its business or default rules.
(4) Where a designated clearing house has power under this section to apply the property notwithstanding an interest, a right or a remedy, a person to whom the designated clearing house disposes of the property in accordance with its business or default rules shall take free from that interest, right or remedy.
[HK SF Bill, Clause 52]