New Delhi, IBBI has proposed amendments to the Insolvency Resolution Process regulations for Corporate Processes, to improve efficiency and reduce costs, and sought inputs from stakeholders by July 10.
These amendments are expected to improve the efficiency and transparency of the Corporate Insolvency Resolution Process (CIRP) and benefit creditors and other stakeholders involved in the CIRP.
In a discussion paper released on Wednesday, the Insolvency and Bankruptcy Board of India (IBBI) proposed that the registered valuer submit a comprehensive valuation report for the corporate debtor as a whole, instead of separate valuations for different asset classes. .
This proposal seeks to eliminate inconsistencies between the CIRP regulations and the Companies (Registered Valuers and Valuation) Rules.
For companies with asset size up to Rs 1,000 crore and micro, small and medium enterprises (MSMEs), the board proposes to appoint only one registered valuer to provide estimates of fair value and liquidation value.
However, keeping in mind the complexities involved, if the Committee of Creditors decides to have two valuers, it has to record the reasons for this before the resolution professional takes action for such appointments, the IBBI said.
This measure will reduce CIRP costs and speed up the process for small entities.
The IBBI, a statutory body under the Ministry of Corporate Affairs, has invited stakeholders, including corporate debtors, creditors, insolvency professionals and the general public, to submit their comments on the proposed amendments by July 10 .
To avoid delays in the appointment of authorized representatives (ARs) of creditors, the IBBI also proposed to allow the interim resolution professional to allow the AR to participate in meetings of the Creditors Committee immediately after an application for his appointment is submitted to the adjudication body. authority.
The discussion paper also addressed the issue of collateral release in the resolution plan; The board proposes that such proposal submitted by the applicant will not extinguish the rights of creditors to proceed against guarantors and demand the realization of guarantees governed by various agreements.
These amendments are expected to improve the efficiency and transparency of the Corporate Insolvency Resolution Process (CIRP) and benefit creditors and other stakeholders involved in the CIRP.
In a discussion paper released on Wednesday, the Insolvency and Bankruptcy Board of India (IBBI) proposed that the registered valuer submit a comprehensive valuation report for the corporate debtor as a whole, instead of separate valuations for different asset classes. .
This proposal seeks to eliminate inconsistencies between the CIRP regulations and the Companies (Registered Valuers and Valuation) Rules.
For companies with asset size up to Rs 1,000 crore and micro, small and medium enterprises (MSMEs), the board proposes to appoint only one registered valuer to provide estimates of fair value and liquidation value.
However, keeping in mind the complexities involved, if the Committee of Creditors decides to have two valuers, it has to record the reasons for this before the resolution professional takes action for such appointments, the IBBI said.
This measure will reduce CIRP costs and speed up the process for small entities.
The IBBI, a statutory body under the Ministry of Corporate Affairs, has invited stakeholders, including corporate debtors, creditors, insolvency professionals and the general public, to submit their comments on the proposed amendments by July 10 .
To avoid delays in the appointment of authorized representatives (ARs) of creditors, the IBBI also proposed to allow the interim resolution professional to allow the AR to participate in meetings of the Creditors Committee immediately after an application for his appointment is submitted to the adjudication body. authority.
The discussion paper also addressed the issue of collateral release in the resolution plan; The board proposes that such proposal submitted by the applicant will not extinguish the rights of creditors to proceed against guarantors and demand the realization of guarantees governed by various agreements.
