Cabinet approves ordinance to amend the Insolvency and Bankruptcy Code, 2016

Posted On : June 01, 2018

The Union Cabinet has approved an ordinance, making further changes to the Insolvency and Bankruptcy Code, 2016 (“IBC”). It is understood that these changes have been proposed on the basis of recommendations by the Insolvency Law Committee (ILC) report issued on March 28, 2018. Some of the key recommendations of the ILC were – 

 

(a)    Homebuyers to be considered as financial creditors and given representation in the committee of creditors of a corporate debtor.
(b)    The voting threshold for approval of resolution plans is proposed to be lowered to 66% from the existing requirement of 75%.
(c)    Easing of rules to enable promoters of micro, small and medium enterprises to bid for their respective companies.

 

The assent of the President of India is awaited on the ordinance, before the same is brought into force.