IBC Requires Urgent Reforms for Needs of Various Sectors

According to the newly amended extant regulations for the corporate insolvency resolution process, a committee of creditors (CoC) is entitled to invite a 'competent authority' under Section 2 of the Real Estate (Regulation and Development) Act, 2016 (RERA) to participate in CoC meetings.

- KARISHMA DODEJA & DEEPALI VERMA

But the amendment only scratches the surface of a much larger structural issue within the insolvency regime.

Resolution of stressed assets in real estate is complex due to its intricate regulatory landscape and the involvement of multiple stakeholders. By allowing RERA authorities to be present at CoC meetings, the amendment acknowledges the critical role they play in real estate insolvencies. However, the scope of the amendment is largely consultative. It stops short of granting a decision-making role to RERA authorities within the insolvency framework. The amendment's sector-specific nature leaves unresolved similar challenges that persist across other regulated sectors.