| Sr.no | Old Provisions | New Amendments | Implications/Remark |
| IBBI (Insolvency Resolution Process for Corporate Persons) (Second Amendment) Regulations, 2018 Effective Date: 1st April 2018 |
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| 1. | Regulation 3 (Eligibility for resolution professional) 3(1)…(c ) is not an employee or proprietor or a partner(i) of a firm of auditors or company secretaries in practice or cost auditors of the corporate debtor; or |
For the words “company secretaries”, the words “secretarial auditors” shall be substituted. | Company secretaries who are not amongst the secretarial auditors of the company will be eligible to be RP |
| 2. | Regulation 33: Costs of the interim resolution professional
Explanation: For the purposes of this Regulation, “expenses” mean the fee to be paid to the interim resolution professional and other expenses, including the cost of engaging professional advisors, to be incurred by the interim resolution professional. |
The following Explanation shall be substituted
For the purposes of this regulation, “expenses” include the fee to be paid to the interim resolution professional, fee to be paid to insolvency professional entity, if any, and fee to be paid to professionals, if any, and other expenses to be incurred by the IRP. |
The regulations provide that the expenses to be incurred on or by the IRP/RP shall be fixed / ratified by the COC, expenses includes now fees to be paid to IP entity which was not mentioned earlier. |
| 3. | Regulation 34: Resolution professional cost
Explanation: Same as Regulation 33 |
Same as amendment to Regulation 33 | |
| 4. | New Regulation:
34A. Disclosure of Costs. – The IRP or the RP, as the case may be, shall disclose item wise insolvency resolution process costs in such manner as may be required by the Board.”. |
Instead of providing a single amount as a Resolution process cost, bifurcation is to be provided.
No format is provided by the board yet for reporting of it. |
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| 5. | New Regulation:
Reg. 35A: Identification of Resolution Applicant The resolution professional shall identify the prospective resolution applicants on or before the 105th day from the Insolvency commencement date.”. |
The amendments now require the RP to identify the prospective resolution applicants on or before the 105th day from the insolvency commencement date.
Currently, there is no deadline. |
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| 6. | Form A: Public Announcement
Sr.8. & Sr.9 (Details of IRP and last date of claim)
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New Entries:
Sr.8: Name And Registration Number of the IP acting as IRP Sr.9: Address and e-mail of The IRP, as Registered with the Board Sr.10: Address and E-Mail to be used for Correspondence with the IRP, If different from those given at Sl. No. 9. Sr.11: Last date for submission of claims |
If IRP is using e-mail and address for correspondence other than as registered with board then same will be clearly visible in the public announcement.
This amendment is for operational simplicity of the board. |
| 7. | Form B: Proof of claim by operational creditors except workmen and employees
Form C: Proof of claim by financial creditors Form D: Proof of claim by a workman or an employee Form E: Proof of claim submitted by authorised representative of workmen and employees Form F: Proof of claim by creditors (other than financial creditors and operational creditors) |
New Provision:
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Insolvency and Bankruptcy Board of India (Liquidation Process) (Amendment) Regulations, 2018 Effective Date: 01/04/2018 |
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| 8. | Regulation 2: Definitions
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New Regulation: 2(1) (ea)
(ea): “liquidation cost” under sub-section (16) of section 5 means- (a) fee payable to the liquidator under regulation 4; (b) remuneration payable by the liquidator under regulation 7; (c) cost incurred by the liquidator under regulation 24; and (d) interest on interim finance for a period of twelve months or for the period from the liquidation commencement date till repayment of interim finance, whichever is lower. |
Earlier liquidation cost was not defined in the regulation.
Only interest portion on interim finance cost raised is to be considered under liquidation cost. |
| 9 | Regulation 3: Eligibility for appointment as liquidator
3 (c ) (i): for the words ‘company secretaries’ |
words ‘secretarial auditors’ shall be substituted. | Similar changes in line of eligibility of IRP and RP |
| 10. | Regulation 32: Manner of Sale
1. Sell an asset on a standalone basis 2. Asset in a slump sale 3. Set of assets collectively 4. Assets in parcels |
after clause (b), the following clause shall be inserted, namely
( c ) sell the corporate debtor as a going concern |
Earlier regulations allow a liquidator to sell an asset on a standalone basis, now allow the liquidator to sell the corporate debtor as a going concern. This will helps in getting more liquidation value then selling asset on standalone basis. Further, it will also help protect the interests of employees in viable units and help reduce the time period for liquidation |
Recent Amendments in Insolvency and Bankruptcy Code, 2018
