Insolvency board mulls more regulatory changes

Even as the amendments to the Insolvency and Bankruptcy Code (IBC) are getting delayed, the Insolvency and Bankruptcy Board of India (IBBI) is planning a slew of regulatory changes to enhance the efficiency of the resolution process.

- RIYANSH VERMA

These will be in addition to the changes already done over the past 8 months.

"Until amendments to the IBC are carried out, it is only logical for the IBBI to make regulatory changes," an official source told FE.

Going forward too, the IBBI will be making significant changes to regulations to improve the efficiency, transparency, and effectiveness of the resolution process," one person added.

In a discussion paper issued in February, the IBBI proposed to empower the committee of creditors (CoCs) to request the adjudicating authority (AA) for a two-stage approval process of resolution plans, where the financial bid and the basic implementation framework may be approved early. "This would enable the resolution applicant to take over the corporate debtor and proceed with plan implementation early," it said.

The IBBI also proposed a mechanism for coordination of CIRP of interconnected entities. This would include provisions for joint hearings, appointment of a common resolution professional, and information sharing protocols to increase efficiency, reduce costs, and improve outcomes in cases involving multiple interconnected entities undergoing CIRP simultaneously.

These changes are likely to take effect without much delay, even as it is unclear when the IBC (Amendment) Bill will be tabled in Parliament.