Context: Recently, the Insolvency and Bankruptcy Board of India (IBBI) amended the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016

• These regulations pertain to the liquidation process.

Key Facts

• The regulations require the Committee of Creditors (CoC) to fix the fee payable to the liquidator.
• Where the fee has not been fixed by the CoC, the regulations provide for a fee as a percentage of the amount realised and of the amount distributed by the liquidator.

About IBBI

• The Insolvency and Bankruptcy Board of India (IBBI) was established on October 1, 2016, under the provisions of the Insolvency and Bankruptcy Code, 2016.
• It functions under the Ministry of Commerce.

Members

• It has a chairman and 10 members.
• One Chairperson; three members from Central Government officers not below the rank of Joint Secretary or equivalent; One nominated member from the RBI; Five members nominated by the Central Government; of these, three shall be whole-time members; More than half of the directors of its board shall be independent directors.

Functions

• It provides a market-determined and time-bound mechanism for an orderly resolution of insolvency and orderly exit, wherever required.
• It writes and enforces rules for transactions, namely, corporate insolvency resolution, corporate liquidation, individual insolvency resolution and individual bankruptcy under the Code.
• It seeks to consolidate and amend laws relating to reorganization as well as insolvency resolution of corporate persons, partnership firms and individuals in a time-bound manner.
• It has been set up to regulate professionals, information utilities (IUs) and agencies engaged in the resolution of insolvencies of companies.
• IBC handles cases under it using tribunals’ namely National Company Law Tribunal (NCLT) and Debt Recovery Tribunal (DRT).