The Insolvency and Bankruptcy Board of India (IBBI) enacted amendments to the Insolvency Resolution Process for Corporate Persons (CIRP) Regulations, 2016.
The changes are outlined in the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Amendment) Regulations, 2024. According to the IBBI, the amendments address operational issues, especially in real estate insolvencies.
One significant amendment mandates separate bank accounts for each real estate project, ensuring transparent financial management. Additionally, the interval between committee of creditors (CoC) meetings has been reduced to 30 days, allowing for quicker decision making. The voting period now spans one to seven days, with provisions for extensions on creditor requests.
Another crucial change involves stricter oversight by the CoC on insolvency resolution process costs. The information memorandum shared with potential resolution applicants will now include the fair value of the corporate debtor, enhancing transparency.
The amendments allow for project- specific resolution plans, aimed at tailoring solutions to individual circumstances. They also require resolution plans to detail a monitoring committee’s role, ensuring effective plan implementation.
The amendments also clarify the responsibilities of the resolution professional during the extension application process before the adjudicating authority, emphasising continuity in the resolution process.
