RECENT AMENDMENTS TO INSOLVENCY AND BANKRUPTCY CODE 2016

RECENT AMENDMENTS TO INSOLVENCY AND BANKRUPTCY CODE 2016

• ·       Now , an Applicant has to pass the Limited Insolvency Examination within twelve months before the date of his application for enrollment with the insolvency professional agency;
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• ·       He has to complete a pre-registration educational course after his enrollment as a professional member with IBBI.
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• ·       He has to disclose as to whether he was an employee of or has been in the panel of any financial creditor of the corporate debtor

·       . An insolvency professional shall disclose the fee payable to him

GAZETTE OF INDIA

EXTRAORDINARY

PART III, SECTION 4

PUBLISHED BY AUTHORITY

NEW DELHI, 27th MARCH, 2018

INSOLVENCY AND BANKRUPTCY BOARD OF INDIA

NOTIFICATION

 New Delhi, 27th March, 2018

Insolvency and Bankruptcy Board of India (Insolvency Professionals) (Amendment Regulations, 2018

IBBI/2017-18/GN/REG027 - In exercise of the powers conferred by sections 196, 207 and 208 read with section 240 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Insolvency and Bankruptcy Board of India hereby makes the following regulations to amend the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016, namely: -

1. (1) These regulations may be called the Insolvency and Bankruptcy Board of India

(Insolvency Professionals) (Amendment) Regulations, 2018.

(2) They shall come into force on 1^st April, 2018.

2. In the Insolvency and Bankruptcy Board of India (Insolvency Professionals)

Regulations, 2016 (hereinafter referred to as principal regulations), in regulation 3, for sub-regulation (3), the following sub-regulation shall be substituted, namely: -

“(3) The syllabus, format, qualifying marks and frequency of the Limited Insolvency

Examination shall be published on the website of the Board at least three months before the examination.”.

3. In the principal regulations, for regulation 5, the following regulation shall be substituted, namely: -

“5. Qualifications and experience.-

Subject to the other provisions of these regulations, an individual shall be eligible for registration, if he -

(a) Has passed the Limited Insolvency Examination within twelve months before the date of his application for enrolment with the insolvency professional agency;

(b) Has completed a pre-registration educational course, as may be required by the Board, from an insolvency professional agency after his enrolment as a professional member; and

 (c) has-

(i) successfully completed the National Insolvency Programme, as may be approved by the Board;

(ii) successfully completed the Graduate Insolvency Programme, as may approved by the Board;

(iii) fifteen years’ of experience in management, after receiving a Bachelor’s degree from a university established or recognised by law; or

(iv) ten years’ of experience as –

(a) chartered accountant registered as a member of the Institute of Chartered Accountants of India,

(b) Company secretary registered as a member of the Institute of Company  

Provided that the insolvency professional entities recognised as on the date of commencement of the Insolvency and Bankruptcy Board of India (Insolvency Professionals) (Amendment) Regulations, 2018 shall comply with the provisions of clauses (a), (b) (c) and (d) on or before 30th September, 2018 and the provisions of clauses (e), (f) and (g) on or before 30th June, 2018.”.

6. In the principal regulations, in the First Schedule, -

(i) for “[ Under regulation 7(2)(g)]” the following shall be substituted, namely: - “[Under regulationA 7 (2) (h)]”;

PRE-DISCLOSURE REQUIREMENTS

(ii) after item (8), the following item shall be inserted, namely: -

“8A. An insolvency professional shall disclose as to whether he was an employee of or has been in the panel of any financial creditor of the corporate debtor, to the committee of creditors and to the insolvency professional agency of which he is a professional member and the agency shall publish such disclosure on its website.”;

(iii) after item (25), the following item shall be inserted, namely: -

“25A. An insolvency professional shall disclose the fee payable to him, the fee payable to the insolvency professional entity, and the fee payable to professionals engaged by him to the insolvency professional agency of which he is a professional member and the agency shall publish such disclosure on its website.”.

7. In the principal regulations, in the Second Schedule, for FORM A, the following Form A.

According to the amendment regulations,

a. Subject to meeting other requirements, an individual shall be eligible for registration as an insolvency professional if he has passed the Limited Insolvency Examination within the last 12 months and has completed a pre-registration educational course from an insolvency professional agency, as may be required by the Board.

b. The syllabus, format, qualifying marks and frequency of the ‘Limited Insolvency Examination’ shall be published on the website of the IBBI at least three months before the examination.

c. An individual with the required experience of 10 / 15 years is eligible for registration as an insolvency professional. In addition, an individual with little or no experience shall be eligible for registration as an insolvency professional on successfully completing the Graduate Insolvency Programme, as may be approved by the IBBI.

d. As a condition of registration, an insolvency professional shall undergo continuing professional education as may be required by the IBBI.

e. An insolvency professional shall not outsource any of his duties and responsibilities under the Code.

f. A company, a registered partnership firm or a limited liability partnership shall be eligible for recognition as an insolvency professional entity, 

if –

i. its sole objective is to provide support services to insolvency professionals, who are its partners or directors, as the case may be;

ii. It has a net worth of not less than one crore rupees;

iii. Majority of its shares is held by insolvency professionals, who are its directors, in case it is a company;

iv. Majority of capital contribution is made by insolvency professionals, who are its partners, in case it is a limited liability partnership firm or a registered partnership firm;