Insolvency and Bankruptcy Code: How stakeholders are learning on the job

Absence of cross-border insolvency laws could lessen the Code's effectiveness

Nine months from the time the Insolvency and Bankruptcy Code has come into effect, all the stakeholders, including creditors, promoters, insolvency professionals and regulators, are becoming familiar with the operation of this new piece of legislation. Take the case of an insolvency resolution professional (IRP) managing the turnaround of a large manufacturing company. On a visit to a factory site in a remote location he receives a call from the promoter of the business. The message is something to this effect: “Get out of the factory at the earliest. I will not be responsible if workers turn violent.”

The resolution