New Amendments to CIRP Regulations – relief for bidders and dissenting financial creditors
The Insolvency and Bankruptcy Board of India (IBBI) amended the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (CIRP Regulations) for the fourth time in 2018 on 5 October 2018 through the IBBI (Insolvency Resolution Process for Corporate Persons) (Fourth Amendment) Regulations, 2018 (Amendment Regulations). The Amendment Regulations have come into force on 5 October 2018. The key highlights of the Amendment Regulations are set out below:
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This change has brought Regulation 21 in line with Regulation 25 which anyway allowed COC members (who had not voted during the COC meeting) to vote on the relevant matters later. |
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These changes are procedural in nature and allow creditors in a class to vote through their authorised representative after a COC meeting if they were unable to vote on any matter prior to such meeting. |
A new condition has been added under Regulation 39A requiring the interim resolution professional (IRP) and RP to maintain physical and electronic copies of records related to corporate insolvency resolution process (CIRP) as per the record retention schedule to be communicated by the IBBI in consultation with insolvency professional agencies. |
The objective of this change appears to be to promote greater transparency and accountability in the performance of obligations by the IRP / RP. |
The amendments to Regulation 38 of the CIRP Regulations are likely to have a significant impact on financial proposals under resolution plans and decision making by COC although courts may need to interpret the scope of the applicability of the new provisions to pending resolution plans.
- Ashwin Bishnoi (Partner) and Shruti Singh (Principal Associate)
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