CAIRR update 29 July, 2019

Summary of administrative change vide notification in the Companies Act, 2013 issued on 25/07/2019 is listed below:

1. Registration offices:
   MCA notifies the establishment of Registrar of Companies at Guwahati relocating it from Shillong and giving it the territorial jurisdiction over the whole states of Assam, Meghalaya, Manipur, Tripura, Mizoram, Nagaland and Arunachal Pradesh for discharging functions under this Act.

   Summary of substantial changes vide notifications issued on 25/07/2019 for the IB Code, 2016 are provided below: Read more…

   
   

2. IBBI (Liquidation Process) (Amendment) Regulations, 2019:
   i. The amendments require completion of liquidation process within one year of its commencement, notwithstanding pendency of applications for avoidance transactions. These provide a model timeline for each task in the liquidation process.

   a. It specifies a maximum time of 90 days from the order of liquidation for completion of compromise or arrangement, if any, proposed by the stakeholders under section 230 of the Companies Act, 2013.
   b. Procedure for Public Announcement under Regulation 12(2) is substituted to include the provision for claimants to update their claims that are already submitted;

   ii. In Regulation 16 Submission of Claim, the amendments require that a stakeholder may submit its claim or update its claim submitted during the corporate insolvency resolution process, as on the liquidation commencement date. Along with submission of claim, a secured creditor shall inform the liquidator of its decision to relinquish its security interest to liquidation estate or to realise its security interest.;

   iii. New Regulations for constitution of a Stakeholders’ Consultation Committee having representation from secured financial creditors, unsecured financial creditors, workmen and employees, government, other operational creditors, and shareholder/partners to advice the liquidator on matters relating to sale. However, the advice of this committee is not binding on the liquidator. Read more…

3. IBBI (Insolvency Resolution Process for Corporate Persons) (Second Amendment) Regulations, 2019:
   i. The amendments specify the process for withdrawal of applications before constitution of committee of creditors (CoC), after constitution of CoC but before issue of invitation for expression of interest, and after issue of invitation for expression of interest.

   ii. The amendments require that while approving a resolution plan or deciding to liquidate the corporate debtor, the CoC may:

   a. approve a plan providing for contribution for meeting the liquidation costs,
   b. recommend sale of the corporate debtor or sale of business of the corporate debtor as a going concern, and
   c. fix, in consultation with the RP, the fee payable to the liquidator, if an order for liquidation is passed by the Adjudicating Authority. Read more…

4. IBBI (Information Utilities) (Amendment) Regulations, 2019:
   i. Regulation 6(2)(e) has been substituted wherein certificate of registration would be granted on the payment of 50 lakh rupees to the Board within 15 days from the commencement of the financial year;

   ii. Age restriction for Independent Directors on the governing Board of IBBI has been extended from 70 to 75 years in Regulation 9(7);

   iii. Regulation 21 on Information Default is substituted with detailed procedure to deliver or remind the debtor, the information of default and its confirmation and the recording of the debtor’s response and intimation to the same to appropriate stakeholders; Read more…