IBBI amends insolvency resolution process norms, include interest of homebuyers
An insolvency resolution plan will need to have a statement spelling out how the interest of all stakeholders will be dealt with, according to the amended regulations under the Insolvency and Bankruptcy Code.
The move would help in ensuring more clarity in terms of taking into consideration interests of stakeholders, including home buyers, concerned during the insolvency process.
With the latest amendment by the Insolvency and Bankruptcy Board of India (IBBI), a resolution plan should have a statement about dealing with the interests of all stakeholders. The IBBI is implementing the Code.
“A resolution plan shall include a statement as to how it has dealt with the interests of all stakeholders, including financial creditors and operational creditors, of the corporate debtor,” an official release said today.
In this regard, regulations pertaining to Insolvency Resolution Process for Corporate Persons as well as to Fast Track Insolvency Resolution Process for Corporate Persons have been amended by the IBBI.The Code, which became operational in December last year, provides for a market-determined and time-bound insolvency resolution process.
A case is taken up for resolution under the Code only after receiving approval of the National Company Law Tribunal (NCLT) for the same. The IBBI has also amended the rules for information utilities, providing more leeway for setting up such entities.
Now, a listed Indian company can hold up to 100 per cent stake in an information utility — which stores financial information that helps to establish defaults as well as verify claims expeditiously. With the latest amendments, a person can, either alone or together with persons acting in concert, have a maximum of 51 per cent stake in an information utility for up to three years from the date of its registration.
Besides, an Indian company listed in India can hold up to 100 per cent of the paid-up equity share capital or total voting power of an information utility for three years from the date of inception. Prior to these amendments, a person was allowed to hold up to 51 per cent stake in an information utility for a maximum of three years.