IBBI Sets 1 Year Deadline for Completion of Liquidation Process, 90 Days for Compromise by Stakeholders

IBBI Sets 1 Year Deadline for Completion of Liquidation Process, 90 Days for Compromise by Stakeholders

• The Insolvency and Bankruptcy Board of India (IBBI) has announced that it has made the liquidation process a time-bound affair. Now the process of liquidation must be finished within one year of its commencement.

• The new regulations also say that a compromise between the stakeholders must happen within 90 days of the liquidation order.

• For these changes, the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Amendment) Regulations, 2019 and the Insolvency and Bankruptcy Board of India (Liquidation Process) (Amendment) Regulations, 2019 have been notified. 

Extra Info

• What is liquidation: Liquidation is the process of bringing a business to an end and distributing its assets to claimants.
• Role of IBBI: The Insolvency and Bankruptcy Board of India is the regulator for overseeing insolvency proceedings and entities like Insolvency Professional Agencies, Insolvency Professionals and Information Utilities in India.

Points to remember:

1. As per IBBI the process of liquidation must be finished within how much time of its commencement?
2. Compromise between the stakeholders must happen within how many days of liquidation?