The Insolvency and Bankruptcy Board of India (IBBI) shall float two discussion papers – one on making changes in the ‘Corporate Insolvency Resolution Process’ (CIRP), and the other on ‘corporate liquidation’ – very soon, a government official told FE
“These discussion papers are intended to make changes in the regulations to maximise the value of recoveries and reduce the time taken for resolutions,” the official said.
Sudhir Chandi, partner, Resurgent Resolution Professional LLP said that IBBI as the regulatory agency under the IBC code needs to have a relook at the entire mechanism and the proposed discussion papers on CIRP and (corporate) liquidation processes are a step in the right direction to elicit feedback and views of all the stakeholders involved to bring about the desired changes and remove the shortcomings observed.
“A series of protracted litigation and conflicting views have emerged overtime resulting in delays .Clarity of role of each stakeholder and their rights and responsibilities need to be specified and strict adherence to the timelines needs to be ensured,” he said.
The issuance of discussion papers by the IBBI are in pursuance with the announcement made by the Finance Minister Nirmala Sitharaman in the Budget this year. Sitharaman had said, “To simplify, ease and reduce cost of compliance, financial sector regulators will be requested to carry out a comprehensive review of existing regulations. For this, they will consider suggestions from public and regulated entities.”