The Insolvency and Bankruptcy Board of India (IBBI) has notified the Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) (Amendment) Regulations, 2026 to strengthen governance standards in insolvency professional agencies (IPAs). The amendments introduce the concept of a nominee director appointed by the Board, who will enjoy the same powers, duties, and responsibilities as other directors. The regulations also tighten eligibility criteria for independent directors by disqualifying persons associated with sponsoring regulators or serving as independent directors in other IPAs. Further, reappointment for a second term of independent directors will now require satisfactory performance review by the Governing Board and prior approval of the IBBI. The amendment additionally mandates that IPAs submit at least two names to the Board for prior approval while appointing or renewing the tenure of a managing director. These changes aim to improve transparency, accountability, independence, and regulatory oversight within insolvency professional agencies.
INSOLVENCY AND BANKRUPTCY BOARD OF INDIA
NOTIFICATION
New Delhi, the 13th May, 2026
Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional
Agencies) (Amendment) Regulations, 2026
F. No. IBBI/2026-27/GN/REG/140.— In exercise of the powers conferred by sections 196,203 and 205 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 further to amend the Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) Regulations, 2016, namely:-
1. (1) These Regulations may be called the Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) (Amendment) Regulations, 2026.
(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 (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) Regulations, 2016, (hereinafter referred to as ‘the principal regulations’), in regulation 5,
(i) in sub-regulation (1), in clause (b), the word “and” occurring at the end, shall be omitted;
(ii) in sub-regulation (1), in clause (c), for the punctuation mark “:” occurring at the end, the words and punctuation mark “; and” shall be substituted;
(iii) in sub-regulation (1), after clause (c) the following clause shall be inserted, namely:-“(d) nominee director.”;
(iv) in the proviso to sub-regulation (1), after the words “minimum seven directors”, the words “excluding the nominee director” shall be inserted;
(v) in sub-regulation (6),
(a) in clause (g), for the punctuation mark “.” occurring at the end, the punctuation mark “;” shall be substituted;
(b) after clause (g), the following clauses shall be inserted, namely: —
“(h) who is not a member of any statutory regulator that has sponsored or promoted the insolvency professional agency, or that directly or indirectly holds shareholding in, or exercises control over, such insolvency professional agency; and
(i) who is not an independent director of any other insolvency professional agency.”
(vi) for sub-regulation (9), the following shall be substituted namely: –
“(9) The second term referred to in sub-regulation (8) shall be subject to a satisfactory performance review of the first term by the Governing Board and prior approval of the Board.”;
(vii) after sub-regulation (14), the following sub-regulation shall be inserted, namely: –
“(15) The Board shall nominate one individual as its nominee director on the Governing Board of an insolvency professional agency, and such nominee director shall have the same status, rights, duties, powers and responsibilities as other directors of the governing board.”
3. In the principal regulations, in regulation 5A, after sub-regulation (6), the following sub-regulations shall be inserted, namely:-
“(6A) For the purpose of obtaining prior approval of the Board under sub-regulation (6) for appointment or renewal of appointment of the managing director, an insolvency professional agency shall forward not less than two names to the Board, at least one month prior to the expiry of the tenure of the existing managing director.”
RAVI MITAL, Chairperson
[ADVT.-III/4/Exty./88/2026-27]
Note: The Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) Regulations, 2016 were published vide Notification No. IBBI/2016-17/GN/REG001 dated 21st November, 2016 in the Gazette of India, Extraordinary, Part III, Sec.4, vide No. 421, dated 22nd November, 2016 and were last amended by the Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) (Amendment) Regulations, 2025 published vide Notification No. IBBI/2024-25/GN/REG117 dated 28th January 2025 in the Gazette of India, Extraordinary, Part III, Section 4, No. 78 on 29th January 2025.
