India Insolvency Regulator Amends Regulations Related To IPs, IPAs

The Insolvency & Bankruptcy Board of India (IBBI) amended regulations related to the insolvency professionals (IPs) and insolvency professional agencies (IPAs) to streamline the compliance obligations.

The amendments aim to simplify the enrolment and registration process, as well as streamline the exit and attendant compliance obligations in the insolvency profession, the insolvency regulator said in a statement.

The IBBI notified the following regulations on 18 September.

• Insolvency and Bankruptcy Board of India (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) (Amendment) Regulations 2023

• Insolvency and Bankruptcy Board of India (Insolvency Professionals) (Second Amendment) Regulations 2023

The salient features of the amendments are as under:

• Introduction of a unified enrolment and registration application form to enable submission of common application form for both enrolment and registration processes.

• Introduction of timeline of 60 days for approval of unified application (for enrolment) by the IPA and of 30 days forwarding the unified application (for registration) to the IBBI.

• Additional requirements introduced for the IPA to consider while accepting application for surrender of professional membership or expelling the professional member. This includes compliance related to payment of fee to the IBBI, disciplinary order issued by the IPA or IBBI, filings and disclosures to the IPA and IBBI.

• Reduction of timelines for approval of unified application (for registration) or communicating prima-facie refusal to grant registration to the applicant by IBBI.

• Introduction of requirement to furnish intimation to IBBI by the IPA in case of acceptance of application for surrender of professional membership, expulsion of professional member, demise of an individual or winding up or dissolution of a company, limited liability partnership or registered partnership firm, who are registered as IPs.

• Introduction of provision for surrender of certificate of registration by the IP to IBBI.

On 18 September, the IBBI also amended the Insolvency Resolution Process for Corporate Persons Regulations 2016 to facilitate smooth conduct of corporate insolvency resolution process.

The amendment regulations add a provision regarding the assistance and cooperation expected from the personnel of the corporate debtor by providing a detailed procedure for taking custody and control of assets and records of the corporate debtor by the resolution professional.

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