Insolvency and Bankruptcy Board of India (IBBI) has amended its Corporate Insolvency Resolution Process Regulations to ensure that as part of due diligence, prior to approval of a Resolution Plan, the antecedents, creditworthiness and credibility of a Resolution Applicant, including promoters, are taken into account by the Committee of Creditors.
This move is aimed at ensuring that the Corporate Insolvency Resolution Process results in a credible and viable Resolution Plan.
Insolvency and Bankruptcy Board of India was set up on 1st October 2016 under the Insolvency and Bankruptcy Code, 2016 (Code). It is a unique regulator: regulates a profession as well as transactions.
It has regulatory oversight over the Insolvency Professionals, Insolvency Professional Agencies and Information Utilities.
It writes and enforces rules for transactions, namely, corporate insolvency resolution, corporate liquidation, individual insolvency resolution and individual bankruptcy under the Code.
It is a key pillar of the ecosystem responsible for implementation of the Code that consolidates and amends the laws relating to reorganization and insolvency resolution of corporate persons, partnership firms and individuals.
This is done in a time bound manner for maximization of the value of assets of such persons, to promote entrepreneurship, availability of credit and balance the interests of all the stakeholders.
The organizational structure of IBBI:
The IBBI has a ten-member board including a Chairman. It has:
- One Chairperson.
- Three members of Central Government offices not below the rank of Joint Secretary or equivalent.
- One nominated member from the RBI.
- Five members nominated by the Central Government; of these, three shall be whole-time members.