PART III - ENFORCEMENT RULES

PART III - ENFORCEMENT RULES

1. Directives

   1. Subject to clause III.6, the Association may in its absolute discretion issue a direction to a Node requiring it to take a Step or Steps (a ‘Directive’) where there is:

      • (a) an Enforcement Event;

      • (b) a Direct Decision Event; or

      • (c) an Indirect Decision Event.

   2. In the Rules, the term ‘Directive Event’ refers to any of the events in clause III.1.1. These Directive Events are defined below.

2. Nodes’ obligation to follow Directives

   1. Subject to clauses III.6 and III.2.2, each Node will promptly comply with the requirements of any Directive applicable to it following receipt of notice of the Directive and in any event no later than any time for compliance which is specified in the notice of the Directive.

   2. Any Directive will take effect immediately upon notice to a Node or Nodes unless otherwise expressly stated in the notice of the Directive.

3. Enforcement Event

   1. An ‘Enforcement Event’ occurs in respect of any one or more Nodes when the Association reasonably determines in good faith that one or both of the following has occurred:

      1. (a) a breach by the relevant Node(s) of any of Part I of the Rules (Master Rules), clause II.1 (Affiliates), clause II.7 (Indemnity), or clause III.2 of these Rules; or

      2. (b) any representation or warranty in the Rules given by the relevant Node(s) is false or misleading when made, repeated, or deemed to have been made or repeated.

4. Direct Decision Event

   1. A ‘Direct Decision Event’ occurs when the Association receives a Decision that the Association reasonably determines in good faith is a Direct Decision.

   2. A ‘Direct Decision’ is a Decision that:

      • (a) has the force of law, has been recognised, or is enforceable in England and Wales or Switzerland;

      • (b) has as one of its subjects the Association or its Affiliates or their respective property or activities; and

      • (c) relates to or concerns the Network, the Network Database, the conduct of any Relevant Activity by any Node(s), or the ownership, possession, transfer, content, or control of BSV.

5. Indirect Decision Event

   1. An ‘Indirect Decision Event’ occurs when the Association receives a Decision which the Association reasonably determines in good faith is an Indirect Decision.

   2. An ‘Indirect Decision’ is a Decision that:

      • (a) has the force of law, has been recognised, or is enforceable in England and Wales or Switzerland;

      • (b) is not a Decision which has as one of its subjects the Association or its Affiliates or their respective property or activities; and

      • (c) relates to or concerns the Network, the Network Database, the conduct of any Relevant Activity by any Node(s), or the ownership, possession, transfer, content, or control of BSV.

6. Restrictions on Directives

   1. The Association may not issue a Directive where there has been no Directive Event.

   2. A Directive may only require a Node or Nodes to do any or all of the following steps (each a ‘Step’):

      • (a) freeze specified coins in unspent transaction outputs;

      • (b) blacklist or whitelist specific IP addresses as peer connections in the Node Software;

      • (c) reassign frozen coins; or

      • (d) invalidate specified blocks.

   3. A Node is only required to take an action that the Association has reasonably determined in good faith is necessary to achieve one or more of the following purposes (each a ‘Purpose’):

Directive Event	Purpose
Enforcement Event	To ensure compliance with the Rules.
Direct Decision	To give effect to or enforce the Direct Decision or avoid the Association breaching or potentially breaching the Direct Decision.
Indirect Decision	To give effect to or enforce the Indirect Decision insofar as it concerns ownership, possession, transfer, content, or control of BSV.

7. Information obligations

   1. Each Node agrees that it will notify the Association promptly of any circumstances which are reasonably likely to give rise to a Directive Event.

   2. Each Node agrees that, on demand by the Association, it will promptly provide the Association with any information the Association may reasonably request in connection with the Rules or any Enforcement Event.

   3. Nothing in this clause III.7 requires a Node to disclose information where the disclosure by that Node would breach Applicable Laws.