NEW DELHI: In a bid to increase transparency in the liquidation process under the Insolvency and Bankruptcy Code (IBC), the Insolvency and Bankruptcy Board of India (IBBI) has proposed amendments to the regulations. In a discussion paper, the IBBI noted that the regulatory framework of the liquidation process has been improvised on several occasions during the last five years to address the difficulties faced by stakeholders, meet the evolving requirements and in aid of achievement of objectives of the Code.
The Code and Liquidation Process Regulations, 2016, provide that the liquidator shall carry on the business of the corporate debtor for its beneficial liquidation, exercise all powers of its board of directors, key managerial personnel and the partners, complies with applicable laws on behalf of the firm, among others.
The IBBI said, "With the emergence of new issues and the gaining of sufficient experience, a need is felt to further strengthen the regulatory framework of liquidation process in terms of accountability of liquidator towards stakeholders and certain matters related to sale." The liquidator is expected to imbibe the highest standards of ethics and professionalism while conducting a fair and rule-based liquidation process.
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