Govt to steer cross-border insolvency regime design

Government to ensure direct role, rather than leaving it to the bankruptcy rule-maker, IBBI

- Gireesh Chandra Prasad

Given the sensitivity of dealing with foreign courts, the corporate affairs ministry, in consultation with the law ministry, will design India's cross-border insolvency regime under the IBC Amendment Bill 2025.

The move will ensure direct government involvement in deciding the key aspects of the framework by way of rules, rather than leaving it to be covered by regulations issued by bankruptcy rule-maker, the Insolvency and Bankruptcy Board of India (IBBI).

The ministries will draft the cross-border insolvency framework taking into account a United Nations (UN) template and the best practices in other countries, according to two persons familiar with the development.

The government is also expected to set up a special National Company Law Tribunal (NCLT) bench for handling cross-border insolvency proceedings, the persons said.

Queries emailed to the corporate affairs ministry and the IBBI on Thursday, seeking comments for the story remained unanswered at the time of publishing.