(1) The rights of -
(a) a participant to collateral security provided to it in connection with a relevant system, and
(b) a central bank to collateral security provided to it,
are not affected by insolvency proceedings against the participant, or the counterparty to a central bank, that provided the collateral security, and that security may be realised for the satisfaction of those rights.
(2) If -
(a) securities are provided as collateral security to a participant or a central bank, or to both, in accordance with paragraph (1), and
(b) the right of the participant or central bank with respect to the securities is legally recorded in a register, account or centralised deposit system located in a Member State,
the law of that Member State governs the determination of the rights of the participant or central bank as a holder of collateral security in relation to those securities.
(3) In this Regulation -
"central bank" includes a nominee, agent or third party acting on behalf of th