Sub-Committee of Insolvency Law Committee recommended IBC pre-pack framework
The Government constituted a sub-committee of Insolvency Law Committee (ILC) vide order dated 24th June, 2020 under the chairmanship of Dr. M. S. Sahoo, Chairperson, Insolvency and Bankruptcy Board of India (IBBI) to make recommendation on pre-pack insolvency resolution process (PPIRP).
This was stated by Shri Anurag Singh Thakur, Union Minister of State for Finance & Corporate Affairs, in a written reply to a question in Lok Sabha today.
The sub-committee has recently submitted its report to the Government, which is available on the website of IBBI (www.ibbi.gov.in), thereby recommending a pre-pack framework within the basic structure of the Insolvency and Bankruptcy Code (IBC), 2016.
File No. 30/20/2020-Insolvency Section
Government of India
Ministry of Corporate Affairs
Dated: 08th January, 2021
Invitation of comments from public on Pre-packaged Insolvency Resolution Process under Insolvency and Bankruptcy Code, 2016
The experience from implementation of the Insolvency and Bankruptcy Code, 2016 (the Code) including evolution of the ecosystem, stabilisation of the processes, growing jurisprudence has prepared ground to look at new initiatives to further improve the effectiveness of the Code. The efficacy of out-of-court workouts in delivering speedier resolutions provided regulators extend the same regulatory exemptions as available to settlements made under the IBC framework was considered and it was felt that Pre-packaged insolvency resolution process (PPIRP) may be introduced under the Code with necessary checks and balances, as an option for resolving insolvency. Government constituted a sub-committee of Insolvency Law Committee (ILC) vide order dated 24.6.2020 to prepare a detailed scheme for implementing pre-pack and prearranged insolvency resolution process.
The sub-committee has designed a pre-pack framework within the basic structure of the Insolvency and Bankruptcy Code, 2016, for the Indian market as detailed in their report of October, 2020 (copy enclosed).
Public comments are hereby invited on recommendations of Sub-committee of ILC on Pre-packaged Insolvency Resolution Process. Suggestion/comments, if any, along with brief justification may be submitted online therein at the below mentioned web link by the end of business hours on 22nd January, 2021:
Stakeholder may please note that comments should not be sent separately through e-mail or hard copy and should be sent only through the web link created for the purpose.
Download Full Text – https://www.ibbi.gov.in/uploads/whatsnew/34f5c5b6fb00a97dc4ab752a798d9ce3.pdf