Changes in the Insolvency & Bankruptcy laws have been the long-standing demand of the industry as the move will help safeguard corporate debtors, protect last mile funding, boost investments in financially distressed sectors, speed-up CIRP process, strengthen the overall IBC framework and further ease doing of business, said Dr Aggarwal, President, PHD Chamber of Commerce and Industry.
The amendment aims to remove various difficulties faced during the Corporate Insolvency Resolution Process (CIRP). The protection of corporate debtor resolved under the IBC in favour of a successful resolution applicant against offences committed by previous management will fast-track the resolution process. This will also attract more bidders/resolution applicants to come forward and bid for stressed assets by boosting their confidence in the IBC process, said Dr Aggarwal.
In a move to provide relief to stressed assets and make them value proposition for the acquirers, the cabinet has ensured that the business of corporate debtor continue as a going concern by clarifying that the licenses, permits, concessions, clearances etc. cannot be terminated or suspended or not renewed during the moratorium period. The additional thresholds have also been proposed for Financial Creditors represented by an authorized representative due to large numbers in order to prevent frivolous triggering of (CIRP). Going ahead, we expect the early approval of the amendments in the Insolvency and Bankruptcy Code in the parliament, said Dr Aggarwal.
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