IBBI amends the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 - (21 Jul 2021)
Insolvency
The Insolvency and Bankruptcy Board of India (IBBI) notifies the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Second Amendment) Regulations, 2016 on 14th July, 2021. The amendment Regulations enhances the discipline, transparency, and accountability in corporate insolvency proceedings. The amended regulations are effective from 14th July, 2021.
A corporate debtor (CD) may have changed its name or registered office address prior to commencement of insolvency. The stakeholders may find it difficult to relate to the new name or registered office address and consequently fail to participate in the CIRP. The amendment requires an insolvency professional (IP) conducting CIRP to disclose all former names and registered office addresses so changed in the two years preceding the commencement of insolvency along with the current name and registered office address of the CD, in all its communications and records.
The interim resolution professional (IRP) or resolution professional (RP) may appoint any professional, including registered valuers, to assist him in discharge of his duties in conduct of the CIRP. The amendment provides that the IRP/RP may appoint a professional, other than registered valuers, if he is of the opinion that the services of such professional are required and such services are not available with the CD. Such appointments shall be made on an arm's length basis following an objective and transparent process.
The RP is duty bound to find out, if a CD has been subject to avoidance transactions, namely, preferential transactions, undervalued transactions, extortionate credit transactions, fraudulent trading and wrongful trading, and file applications with the Adjudicating Authority seeking appropriate relief. For effective monitoring, the amendment requires the RP to file Form CIRP on the electronic platform of the Board, intimating details of his opinion and determination in respect of avoidance transactions. This Form needs to be filed in respect of every CIRP ongoing or commencing on or after 14th July, 2021.
Tags : AMENDMENT REGULATIONS CIRP
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