Insolvency and Bankruptcy Board of India (IBBI) has issued the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Fourth Amendment) Regulations, 2025, effective May 26, 2025. These amendments aim to enhance the corporate insolvency resolution process. Key changes include enabling part-wise resolution of corporate debtors, allowing resolution professionals, with Committee of Creditors (CoC) approval, to invite expressions of interest for the entity as a whole or specific assets, or both, concurrently. This may shorten timelines and encourage broader investor participation. Additionally, the regulations now harmonize payment timelines for resolution plans, ensuring dissenting financial creditors are paid pro rata and in priority over approving financial creditors in each stage of staged payments. Providers of interim finance can now attend CoC meetings as observers to gain operational understanding. Furthermore, resolution professionals are mandated to present all received resolution plans, including non-compliant ones, to the CoC for comprehensive decision-making.
Insolvency and Bankruptcy Board of India
Press Release No. IBBI/PR/2025/14 | Dated: 30th May 2025
Insolvency and Bankruptcy Board of India amends the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (CIRP Regulations)
1.The Insolvency and Bankruptcy Board of India (IBBI/Board) has notified the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Fourth Amendment) Regulations, 2025 (Amendment Regulations) on 26th May 2025. The amendments, which come into immediate effect, aim to further streamline and strengthen the corporate insolvency resolution process.
2. Key highlights of the Amendment Regulations are as follows:
(i) Facilitating part-wise resolution of Corporate Debtor: The resolution professional, with the approval of the CoC, can invite expression of interest for submission of resolution plans for the corporate debtor as a whole, or for sale of one or more of assets of the corporate debtor, or for both. By enabling concurrent invitations, the resolution process can reduce timelines, prevent value erosion in viable segments, and encourage broader investor participation.
(ii) Harmonizing timelines for payment under resolution plan: Where a resolution plan provides for payment in stages, the financial creditors who did not vote in favour of the resolution plan shall be paid at least pro rata and in priority over financial creditors who voted in favour of the plan, in each stage. This approach balances the legitimate rights of dissenting creditors with the practical constraints of phased implementations.
(iii) Facilitating the providers of interim finance: CoC has been empowered to direct the resolution professional to invite the providers of interim finance to attend CoC meetings as observers without voting rights. This measure is intended to provide interim finance providers with a better understanding of the corporate debtor’s operational status, thereby enabling them to make well-informed decisions regarding funding requirements.
(iv) Presentation of all plans before the Committee of Creditors (CoC): Resolution professionals are now required to present all resolution plans received, including those that are non-compliant, to the CoC along with relevant details. This provision ensures that the CoC has access to comprehensive information for decision-making, which may lead to more informed choices and ultimately contribute to a more transparent and effective resolution process.
3. The amended regulations are available at the Board’s website: www.ibbi.gov.in.
