IBBI amends regulations relating to CIRP
On November 13, 2020 Insolvency and Bankruptcy Board of India (“IBBI”) notified the following regulations vide a notification prescribed under the provisions of Insolvency and Bankruptcy Code, 2016 (“IBC”) Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Fifth Amendment) Regulations, 2020 (“CIRP Amendment Regulations”) Insolvency and Bankruptcy Board of India (Liquidation Process) (Fourth Amendment) Regulations, 2020 (“Liquidation Amendment Regulations”) and Insolvency and Bankruptcy Board of India (Information Utilities) (Amendment) Regulations, 2020 (“IU Amendment Regulations”) The key changes in the aforesaid regulations are as follows The CIRP Amendment Regulations specify two ‘other record or evidence of default’, namely, (a) certified copy of entries in the relevant account in the bankers’ book, and (b) order of a court or tribunal that has adjudicated upon the non-payment of a debt. As per the CIRP Amendment Regulations, the IRP/ RP is required to submit the list of creditors on an electronic platform for dissemination on its website, including ongoing corporate insolvency resolution process. The CIRP Amendment Regulations mandates the Resolution Professional to intimate each claimant the principle or formulae for payment of debts under a resolution plan, within 15 days of the order of the Adjudicating Authority approving the resolution plan. The Liquidation Amendment Regulations enables the liquidator to assign or transfer a ‘not readily realisable asset’ to any person in consultation with the stakeholders’ consultation committee in order to facilitate quick closure of the liquidation process. The Liquidation Amendment Regulations has enabled a creditor to assign or transfer the debt due to it to any other person in accordance with the laws for the time being in force dealing with such assignment or transfer, in during the continuation of liquidation process. The IU Regulations have been amended to the effect to specify public announcement made under the provisions of the IBC as ‘financial information’. It has now mandated the Information Utilities to disseminate the public announcement to its registered users, who are creditors of the CD undergoing insolvency proceeding. This is in addition to publishing the public announcement in the newspapers and websites as required in the Regulations. Please find a copy of the Amendment Regulations below CIRP Amendment Regulations Liquidation Amendment Regulations IU Amendment Regulations This update has been contributed by Pooja Chakrabarti (Partner) and Kiran Sharma (Associate).