November 18, 2019
Summary of Notifications issued by IBBI dated 15/11/2019.
1. IBBI notifies sections pertaining to personal guarantors to Corporate Debtors
Sections namely 2(e), 78 (except w.r.t fresh start process), 79, 94 to 187, 239(2)(g) to 239(2)(i), 239(2)(m) to 239(2)(zc) , 240(2)(zs) to 240(2)(zn) and 249, in so far as they relate to personal guarantors to Corporate Debtors, shall come into effect from 1st December, 2019.
2. IBBI notifies rules under IBC,2016 for resolution of Personal Guarantors to Corporate Debtors
Through introduction of Insolvency and Bankruptcy (Application to Adjudicating Authority for Bankruptcy Process for Personal Guarantors to Corporate Debtors) Rules, 2019 and Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019, IBBI lays out the detailed procedure for applications to be filed by Personal Guarantor/Creditor to initiate the bankruptcy and insolvency process under the aforesaid Rules. The rules also specify the procedure for appointment of Insolvency Resolution Professional, along with formats for various forms and notices to be filed/issued during the resolution process. These rules shall come into effect from 1st December, 2019.
3. IBBI notifies rules under IBC, 2016 for resolution of Financial Service Providers
Through introduction of Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019, IBBI lays out the insolvency proceedings procedure to be adopted in case of defaulting Financial Service Providers (FSPs). The rule indicates the constitution of Advisory Committee, who may advise the Administrator in-charge of the defaulting FSP, who would be appointed by the Adjudicating authority. The Adjudicating authority shall appoint the Administrator based on the proposal received from the Appropriate Regulator, in Form 1 as defined under the said Rules. The Administrator, upon submitting written consent in Form 2, shall then take control and custody of third-party assets or properties in custody or possession of the FSP. The Rule also provides for Moratorium and Resolution Plan time frames to be adhered with by the administrator.