When the Insolvency and Bankruptcy Code was introduced in 2016, an exception was made under section 3(17) for Financial Service Providers (FSPs) to prevent them from being dragged into insolvency. In 2019, Ministry of Corporate Affairs vide a press release introduced the Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019, to provide a framework for the systematic insolvency and liquidation of FSPs.
In the latest #Simplified video series, our sector expert Abhirup Dasgupta, discuss provisions under the IBC relating to the Corporate Insolvency Resolution Process (CIRP) and the liquidation process applied to the resolution process for FSP in the same way they apply to any other corporate debtor, subject to certain sector-specific differences.
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