The Insolvency and Bankruptcy Board of India in its Notification dated 27th November 2019, has published the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Third Amendment) Regulations, 2019.
Key Highlights from the amendment made in Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016:
- Under the amendment regulation the authorized representative shall cast his vote in respect of each financial creditor or on behalf of all financial creditors he represents in accordance with the provisions of Section 25A(3) or (3A). Section 25A(3A) provides that the authorized representative shall cast all votes in accordance with decision taken by vote of more than 51% of voting shares (For example, if 52% of financial creditors give instructions in favour of resolution and 48% against, his entire 100% voting will be in favour of resolution).
- A new resolution plan for “restructuring of the corporate debtor, by way of merger, amalgamation and demerger” has been inserted through this amendment.
- The amount payable under a resolution plan –
- to the operational creditors shall be paid in priority over financial creditors; and
- to the financial creditors, who have a right to vote under section 21(2) and did not vote in favour of the resolution plan, shall be paid in priority over financial creditors who voted in favour of the plan
- A new Regulation 40B related to “Filing of Forms” has been inserted, where the insolvency professional, interim resolution professional or resolution professional shall file the Forms on an electronic platform of the Board, as per the timelines stipulated against each Form.
Click here to read the Notification
