IBC suspension during Covid-19 will give firms breathing space: Experts

As per the Ordinance, the corporate insolvency resolution process cannot be initiated against a company under the IBC for defaults arising on or after March 25, 2020, for a period of six months

The government's decision to shield corporates from the Insolvency and Bankruptcy Code (IBC) during the coronavirus pandemic will provide some breathing space to businesses struggling to combat the onslaught of diminishing demand and poor growth prospects, according to experts.

Lenders as well as operational creditors can look at the alternative mechanism outside the IBC to recover debts, said experts while commenting on the implications of the Ordinance to temporarily suspend the provisions of the IBC, news agency PTI reported.

As per the Ordinance, the corporate insolvency resolution process cannot be initiated against a company under the IBC for defaults arising