Cabinet approves Insolvency and Bankruptcy Code (Second Amendment) Bill, 2019

The Union Cabinet chaired by the Prime Minister Shri Narendra Modi today approved the proposal to make amendments in the Insolvency and Bankruptcy Code, 2016 (code), through the Insolvency and Bankruptcy Code (Second Amendment) Bill, 2019.  The amendments aim to remove certain difficulties being faced during insolvency resolution process to realise the objects of the code and to further ease doing of business.

Details of the Proposal

The Amendment Bill seeks to amend sections 5(12), 5(15), 7, 11, 14, 16(1), 21(2), 23(1), 29A, 227, 239, 240 and insert new section 32A in the Insolvency and Bankruptcy Code, 2016 (Code).

Impact

1. Amendments to the Code to remove bottlenecks, streamline the CIRP and protection of last mile funding will boost investment in financially distressed sectors.
2. Additional thresholds introduced for Financial Creditors represented by an authorized representative due to large numbers in order to prevent frivolous triggering of Corporate Insolvency Resolution Process (CIRP).
3. Ensuring that the substratum of the business of corporate debtor is not lost, and it can continue as a going concern by clarifying that the licenses, permits, concessions, clearances etc. cannot be terminated or suspended or not renewed during the moratorium period.
4. Ring-fencing corporate debtor resolved under the IBC in favour of a successful resolution applicant from criminal proceedings against offences committed by previous management/promoters.

 INSOLVENCY AND BANKRUPTCY (APPLICATION TO ADJUDICATING AUTHORITY) RULES, 2016

In exercise of the powers conferred under sub-section (2) of section 7, sub-section (1) of section 8, sub-section (2) of section 9, sub-section (2) of section 10, sub-sections (1) and (2) of section 239 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Central Government hereby makes the following Rules, namely:

1. Short title and commencement

(1) These Rules may be called the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016.

(2) They shall come into force from the date of their publication in the Official Gazette.

DRAFT FOR PUBLIC COMMENTS

INSOLVENCY AND BANKRUPTCY (INSOLVENCY RESOLUTION PROCESS FOR

CORPORATE PERSONS) REGULATIONS, 2016

1. Short title and commencement

(1) These regulations may be called the Insolvency and Bankruptcy (Insolvency Resolution

Process for Corporate Persons) Regulations, 2016.

(2) They shall come into force on the date of their publication in the Official Gazette.

Download Complete Rules – Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016.

Download  Insolvency and Bankruptcy (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.

In exercise of the powers conferred by section 196 read with sub-sections (1) and (2)(zz)- (zzd) of section 240 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Board hereby makes the following Regulations to provide a framework for registration of insolvency professional agencies in terms hereof, namely

Short Title and Commencement

1. (1) These Regulations may be called the Insolvency and Bankruptcy (Registration of Insolvency Professional Agencies) Regulations, 2016.

(2) These Regulations shall come into force on the date of their publication in the Official Gazette.

Definitions

2. (1) In these Regulations, unless the context otherwise requires –

(a) “Board” means the Insolvency and Bankruptcy Board of India established under Section 188 of the Code;

(b) “bye-laws” means the bye-laws of an insolvency professional agency made under section 205 of the Code, in accordance with the Insolvency and Bankruptcy (Model Bye-Laws of Insolvency Professional Agencies) Regulations, 2016;

(c) “Code” means the Insolvency and Bankruptcy Code, 2016;

(d) “control” shall have the same meaning as assigned to it in section 2(27) of the Companies Act, 2013;

Download Draft Insolvency and Bankruptcy (Registration of Insolvency Professional Agencies) Regulations, 2016