(a) If the substance of a duty imposed upon a securities intermediary by Sections 8504 to 8508, inclusive, is the subject of a federal statute, regulation, or rule, compliance with that statute, regulation, or rule satisfies the duty.
(b) To the extent that specific standards for the performance of the duties of a securities intermediary or the exercise of the rights of an entitlement holder are not specified by other statute, regulation, or rule or by agreement between the securities intermediary and entitlement holder, the securities intermediary shall perform its duties and the entitlement holder shall exercise its rights in a commercially reasonable manner.
(c) The obligation of a securities intermediary to perform the duties imposed by Sections 8504 to 8508, inclusive, is subject to the following:
(1) Rights of the securities intermediary arising out of a security interest under a security agreement with the entitlement holder or otherwise.
(2) Rights of the securities intermediary under other law, regulation, rule, or agreement to withhold performance of its duties as a result of unfulfilled obligations of the entitlement holder to the securities intermediary.
(d) Sections 8504 to 8508, inclusive, do not require a securities intermediary to take any action that is prohibited by other statute, regulation, or rule.
(Added by Stats. 1996, Ch. 497, Sec. 9. Effective January 1, 1997.)