STATUTORY UPDATES
The Insolvency Professionals to act as Interim Resolution Professionals, Liquidators, Resolution Professionals and Bankruptcy Trustees (Recommendation) Guidelines, 2024 issued on June 05, 2024.1
- IBBI has issued the Insolvency Professionals to act as Interim Resolution Professionals, Liquidators, Resolution Professionals and Bankruptcy Trustees (Recommendation) Guidelines, 2024 (Recommendation Guidelines) in order to provide for a procedure to prepare a panel of IPs to act as IRPs, Liquidators, RPs and Bankruptcy Trustees.
- These Recommendation Guidelines provides for the following
criteria to prepare a panel of Ips, which shall be effective from
July 01, 2024 to December 31, 2024.
- Eligibility of IPs – (i) No disciplinary proceeding; (ii) No conviction at any time during last three years; (iii) submission of Expression of Interest along with Consent to act as IRP, RP, Liquidator and Bankruptcy Trustee for appointment by Adjudicating Authority; (iv) Must have a valid Authorisation for Assignment (AFA) for the relevant period.
- Expression of Interest – On invitation by the IBBI, the IP should submit EOI by the specified date in Form A, which shall be unconditional consent by an IP to act as IRP, RP, Liquidator and Bankruptcy Trustee for any corporate or individual debtor and will include the details of the sectors in which assignments have been handled by the respect Ips.
- Panel of IPs – The IBBI will prepare a common zone-wise panel for appointment of IRP, RP, Liquidator and Bankruptcy Trustee and share with the Adjudicating Authority, which will have a validity of six months.
- Sorting Criteria – These Recommendation guidelines give due weightage to the experience of the IPs in the order of the volume of completed assignment.
- Conditions for IPs – The inclusion of an IP in the Panel will be deemed acceptance to act as IRP, RP, Liquidator and Bankruptcy Trustee and the IP shall not withdraw their consent or refuse the appointment uncles otherwise permitted by the Adjudicating Authority. Any refusal shall be treated as deviation from consent and the name of the IP will be removed from the panel for six months.
- The appointment of an IP is at the discretion of the Adjudicating Authority and may refer to or direct the Board for the appointment of IP including the recommendation of IP, from or outside the Panel and in such cases, the Board may accordingly take suitable action for the appointment of IP, from or outside the panel.
Discussion Paper on "Reducing compliance by Review of CIRP Forms submitted by Insolvency Professionals to IBBI" dated June 10, 20242
- On initiation of Corporate Insolvency Resolution Process (CIRP) in respect of a Corporate Debtor, an Insolvency Professional (IP) is appointed, who exercises the powers of the Board of Directors of a Corporate Debtor and ensures compliances on its behalf. The performance of an IP is monitored by IBBI who in turn collects, maintains and disseminate all the information and records relating to the CIRP. In order to facilitate this collection, Regulation 40B of the IBBI (Corporate Insolvency Resolution Process) Regulations, 2016 (CIRP Regulations) a set of forms are required to be filed by the IP with the IBBI, as elaborated in the CIRP Regulations.
- By way of this discussion paper, the Insolvency and Bankruptcy Board of India (IBBI) has proposed modifications in the CIRP Forms submitted under Section 40B of the CIRP Regulations by an IP, in order to remove duplicity and redundancy and has further suggested consequent changes in the CIRP Regulations.
- Most importantly, by way of this discussion paper, IBBI proposes a shift from stage/ event based compliance to monthly compliance reporting i.e. filing of applicable forms by 10th of every month, in order to streamline the compliance process by an IP.
- A brief of the suggested modifications in forms under Regulation 40B is as under:
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Footnotes
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