1. Insolvency & Bankruptcy Code-2016 Journey so far
Dr. Navrang Saini
Whole Time Member,
Insolvency & Bankruptcy Board of India

2. ROLE OF IBBI

3. Institutional Framework under IBC, 2016
Insolvency & Bankruptcy Board of India (IBBI)
Insolvency Professional Agencies (IPA)
Insolvency Professionals (IP)
Information Utilities (IUs)
Adjudicating Authority
Institutional Framework under IBC, 2016

4. Insolvency in Pre IBC Regime - Corporates
Companies Act, 1956 /2013
Official Liquidator – attached to HCs
ICLS officers & bureaucratic machinery
Insolvency in Pre IBC Regime - Corporates

5. Insolvency Under IBC Regime
Insolvency Professional
Private Professionally Qualified Individual
Insolvency Under IBC Regime
SO, Basically the process has been privatised & NEED TO REGULATE the same led to establishment of IBBI

6. IPs
IPAs
IUs
Registered Valuers
PROFESSION
Corporate insolvency resolution
Corporate liquidation
Individual insolvency resolution
Individual bankruptcy
PROCESSES
IBBI: a Unique Regulator (It regulates a profession as well as processes)

7. FACILITATIONS BY THE REGULATOR
Amendment to CIRP regulations (8 times)
Amendment to Liquidation regulations (2 time)
Amendment to IP regulations(2 time)
Amendment to IU Regulations (3 time)
Issuance of Circulars & Guidelines
FACILITATIONS BY THE REGULATOR

8. IBBI is the authority for Valuation Rules
Valuation – the most critical aspect
The Companies (Registered Valuers and Valuation) Rules, notified under the Companies Act, 2013, provides a comprehensive framework for development and regulation of the profession of valuers. The Central Government delegated its powers and functions under section 247 of the Companies Act to the IBBI vide notification dated 18th October, According to this notification, only a person, who is registered with the IBBI as an RV, can conduct valuations required under the Companies Act, 2013 and the Code.
With effect from February 1, 2019, no insolvency professional shall appoint a person other than a registered valuer to conduct any valuation under the Code or any of the regulations made there under.
IBBI is the authority for Valuation Rules

9. Status of 12 Big Accounts 3 resolutions completed
3 resolutions ordered
1 failure to implement approved plan, CoC reconstituted
5 at various stages including one in liquidation.
Status of 12 Big Accounts

10. Liquidation Order in 378 CIRPs (as on March 31, 2019)
Initiation: 137 FC, 131 OC, 83 CD
Erstwhile BIFR/ Not going concern: 283
75% cases - economic value eroded before CIRP admission
Liquidation Order in 378 CIRPs (as on March 31, 2019)

11. Resolution in 94 CIRPs (as on March 31, 2019)
Initiation: 50 FC, 26 OC, 18 CD
Erstwhile BIFR/ Not going concern: 32
Resolution in 94 CIRPs (as on March 31, 2019)
(Amounts in crore)
*Excluding data w.r.t. Essar Steels.

12. Initiation of CIRPs (as on March 31, 2019)

13. Status of cases admitted under CIRP (as on March 31, 2019)

14. Disciplinary Proceeding
The Insolvency and Bankruptcy Code, 2016 (Code) envisages that an insolvency professional may be appointed as IRP, RP, liquidator, or a bankruptcy trustee if no disciplinary proceeding is pending against him.
The Code, however, does not define ‘disciplinary proceeding’. Section 219 envisages issue of show cause notice following an inspection or investigation and Section 220 envisages constitution of a disciplinary committee for consideration of the inspection or investigation report. Various regulations made under the Code envisage issue of show cause notice based on findings of an inspection or investigation or on material otherwise available on record. They also envisage constitution of disciplinary committee for disposal of show cause notice.
Disciplinary Proceeding

15. Pendency of Disciplinary Proceeding
(i) a disciplinary proceeding is considered as pending against an insolvency professional from the time he has been issued a show cause notice by the Insolvency and Bankruptcy Board of India till its disposal by the disciplinary committee; and
(ii) an insolvency professional who has been issued a show cause notice shall not accept any fresh assignment as interim resolution professional, resolution professional, liquidator, or a bankruptcy trustee under the Code.
Pendency of Disciplinary Proceeding

16. Disciplinary Committee Process
Case Referred to Disciplinary Committee up to 180 days.
Finding Against IP
IP Hearing
IP did not Appear for Hearing
Finding Upheld.
Finding Overturned
Outcome Advised to IP and Complainant
Impose Punishment/ Penalty
Closing of SCN without any Directions.
Sanction Publish on IBBI Website
Monitoring of Execution of Order- Monitoring Penalty
Order Closed

17. Section 217 and section 218
Board on receipt of complaint (Sec.217) or reasonable ground to believe contravention of any provision of the Code [Sec 218(1)]
Inspection/ Investigation may be conducted (IP/IPA/IU/RV/RVO)
Report Submitted to the Board by I.A (218(6)).
Show Cause notice Sec (219)
Board Considers the Report * ( Reg. 11(1) of IBBI Insolvency and Investigation ) Reg.2017.
* ( Reg. 11(2) of IBBI Insolvency and Investigation ) Reg.2017.

18. Issue Show Cause Notice
Board prima facies opinions that sufficient cause exists under Sec.220 or 236 (2) of IBC.
Issue Show Cause Notice
21 Days time to noticee to reply
Refer SCN to Disciplinary Committee with record/ written submission.
Opportunity of Hearing
DC to dispose of within 180 days of issue of SCN or if DC is satisfied it may close SCN without notice [Sec 220 (2)].

19. Status of adjudication
DETAILS OF PENALTY IMPOSED
Status of adjudication
S.no
Particulars
No. of Orders Issued 1
Cancellation of registration 4 2
Suspension 3
Warning
Restitution 5
Disgorgement 6
Fine 7
Others
Total No. of orders issued 13

20. CHALLENGES Resolution vs. Liquidation Resolution vs. Recovery
Interest of Stakeholders
Resolution Plan
Resolution Applicant
Markets: Interim finance, Resolution Plan, Liquidation Assets
Large Number of Creditors
Cross Border Insolvency
Asymmetry of Information
CHALLENGES

21. Role of CoC not envisaged under the Code.
Do they (COC) have some duties? (like that of the Directors under the Companies Act, 2013)
How to control the conduct of CoC?
Waterfall mechanism
Code differentiates between FC and OC as conceptualised by BLRC. But should the distinction continue right upto distribution priorities, as both are under the class of unsecured creditor. Unsecured FC appear in 4 th rank and Unsecured OC appear in 6 th rank.
Globally, priority to secured creditors is given over unsecured creditors but there is no distinction between FC and OC.
CHALLENGES

22. NEXT STEPS Reviewing Regulations
Graduate Insolvency Program, National Insolvency Program
Individual Insolvency
Cross Border Insolvency
Valuation Standards
NEXT STEPS

23. For any queries, you may write to – dr.navrang@ibbi.gov.in
THANK YOU !!!
For any queries, you may write to –