On September 24, 2024, the Insolvency and Bankruptcy Board of India (IBBI) issued the second amendment to the Insolvency Resolution Process for Corporate Persons Regulations, 2016. The amendment modifies regulations around the verification of claims and appointment of representatives. Specifically, in Regulation 12, sub-regulation (1) replaces sub-regulation (2). In Regulation 16A, a change has been made concerning the appointment of insolvency professionals by financial creditors, where Form CA submitted after the public announcement deadline will not be considered. Moreover, an interim insolvency professional will serve as an authorised representative for a class of creditors until the appointment is confirmed by the adjudicating authority, with the ability to attend meetings and perform representative duties. Additionally, the amendment removes the requirement to verify claims under Regulation 12(2) and adjusts the timelines associated with Regulation 13(1). These amendments aim to streamline the insolvency process and clarify the roles of insolvency professionals, particularly in cases where creditors’ representatives are yet to be appointed. This update is part of the ongoing effort to ensure clarity and efficiency in the corporate insolvency resolution process under the Insolvency and Bankruptcy Code, 2016.
Insolvency and Bankruptcy Board of India
Press Release No. IBBI/PR/2024/21 Dated: 25th September, 2024
Insolvency and Bankruptcy Board of India amends the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (CIRP Regulations)
The Insolvency and Bankruptcy Board of India (IBBI/Board) notified the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Second Amendment) Regulations, 2024 (Amendment Regulations) on 24th September, 2024.
2. The Amendment Regulations provides for the appointment of an interim representative who will act as a representative for a class of creditors during the period when the application for appointment of the authorised representative is under consideration of the Adjudicating
Authority for approval. This interim representative will have the same rights and duties as an authorised representative in meetings of the committee of creditors.
3. These amendments aim to facilitate the effective representation of certain classes of creditors which are large in numbers, such as homebuyers, during the corporate insolvency resolution process.
4. The amended regulations are effective from 24th September, 2024 and are available at www.ibbi.gov.in.
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INSOLVENCY AND BANKRUPTCY BOARD OF INDIA
NOTIFICATION
New Delhi, the 24th September, 2024, 2024
Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Second Amendment) Regulations, 2024.
No. IBBI/2024-25/GN/REG116. In exercise of the powers conferred by clause (t) of sub- section (1) of section 196 read with section 240 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Insolvency and Bankruptcy Board of India hereby makes the following regulations to further amend the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, namely:-
1. (1) These regulations may be called the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Second Amendment) Regulations, 2024.
(2) They shall come into force on the date of their publication in the Official Gazette.
2. In the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (hereinafter referred to as ‘the principal regulations’), in regulation 12, in sub-regulation (3), for the words, figure and mark “sub-regulation (2)”, the words, figure and mark “sub-regulation (1)” shall be substituted.
3. In the principal regulations, in regulation 16A,
(1) in sub-regulation (1), for the proviso, the following proviso shall be substituted, namely: –
“Provided that the choice of an insolvency professional to act as an authorised representative by a financial creditor in a class in Form CA shall not be considered, if the Form CA is received after the time stipulated in the public announcement.”
(2) in sub-regulation (2),
(i) for the word, figure and mark “regulation 12.”, the word, figure and mark “regulation 12:” shall be substituted.
(ii) the following proviso shall be inserted, namely: –
“Provided that till the application for appointment of the authorised representative for a class of creditors is under consideration before the Adjudicating Authority, the insolvency professional selected under sub-regulation (1) shall act as an interim representative for such class of creditors, and shall be entitled to attend the meetings of the committee and shall have such rights and duties as that of an authorised representative.”
4. In the principal regulations, in regulation 40A, in the Table,
(1) The row relating to Regulation 12(2), shall be omitted.
(2) In the row relating to Regulation 13(1),
(i) in column titled ‘Description of Activity’, the words, figures and marks “Verification of claims received under regulation 12(2)” shall be omitted.
(ii) in column titled ‘Latest Timeline’, the word, figure and mark “T+97” shall be omitted.
RAVI MITAL, Chairperson
[ADVT.-III/4/Exty./521/2024-25]
Note: The Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 were published vide notification No. IBBI/2016- 17/GN/REG004, dated 30th November, 2016 in the Gazette of India, Extraordinary, Part III, Section 4, No. 432 on 30th November, 2016 and were last amended by the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Amendment) Regulations, 2024 published vide notification No. IBBI/2023-24/GN/REG113, dated the 15th February, 2024 in the Gazette of India, Extraordinary, Part III, Section 4, No. 99 on 15th February, 2024.
