Executive Summary:
This notification publishes the Insolvency and Bankruptcy Board of India (IBBI) Insolvency Professionals Amendment Regulations, 2019, which further amends the 2016 regulations. Key changes include new definitions, the introduction of mandatory authorization for assignments after December 31, 2019, and revisions to the rules around conflict of interest and employment for insolvency professionals. These amendments aim to strengthen the regulatory framework governing insolvency professionals in India.
Key Points / Main Content:
Definitions:
* Assignment is defined as any assignment of an insolvency professional.
* Authorization for assignment is defined as an authorization to undertake an assignment, issued by an insolvency professional agency to its professional member.
* Bar Council means a Bar Council constituted under the Advocates Act, 1961.
Authorization for Assignment:
* Insolvency professionals must hold a valid authorization for assignment to accept or undertake assignments after December 31, 2019.
* This requirement does not apply to assignments already underway on December 31, 2019 or until the expiry date of existing authorization.
Authorization for Assignment and Disciplinary Proceedings:
* The heading of Chapter IV is substituted to: CHAPTER IV ISSUE AND SURRENDER OF AUTHORISATION FOR ASSIGNMENT AND DISCIPLINARY PROCEEDINGS.
Information to the Board:
* Insolvency professional agencies must inform the Board within one working day when it:
* Issues or renews an authorization for assignment.
* Suspends or cancels an authorization for assignment.
* Revokes the suspension of an authorization for assignment.
* Accepts the surrender of an authorization for assignment.
Grounds for Suspension or Cancellation:
* Suspension or cancellation of authorization for assignment is added as a ground for disciplinary action.
Conflict of Interest and Employment Restrictions:
* Insolvency professionals must disclose any conflicts of interest to stakeholders when they arise during an assignment.
* Insolvency professionals must not engage in any employment when they hold a valid authorization for assignment or when they are undertaking an assignment.
* Insolvency professionals and their relatives are restricted from accepting certain employment or providing professional services to specific parties involved in a corporate insolvency resolution process for one year after cessation from the process, unless the employment is secured through open competitive recruitment.
* An insolvency professional shall not engage or appoint any of his relatives or related parties, for or in connection with any work relating to any of his assignment.
* An insolvency professional shall not provide any service for or in connection with the assignment which is being undertaken by any of his relatives or related parties.
Impact Analysis:
Insolvency Professionals:
* Impact: They must obtain authorization for assignment to continue practicing after December 31, 2019. They face stricter rules regarding conflict of interest, employment, and relationships with related parties.
* Action Required: Obtain authorization for assignment from their insolvency professional agency, disclose conflicts of interest, and adhere to the new employment restrictions.
Insolvency Professional Agencies:
* Impact: They are responsible for issuing and managing authorizations for assignment and informing the Board of related actions.
* Action Required: Establish processes for issuing, renewing, suspending, canceling, and accepting the surrender of authorizations for assignment and for informing the Board of related actions.
Insolvency and Bankruptcy Board of India (IBBI):
* Impact: Oversees the implementation and enforcement of the amended regulations.
* Action Required: Monitor compliance with the new regulations, update relevant guidelines and procedures, and take enforcement actions as necessary.
Stakeholders (Creditors, Debtors, Resolution Applicants, etc.):
* Impact: Benefit from increased transparency and accountability of insolvency professionals.
* Action Required: Be aware of the new regulations and report any suspected violations to the IBBI.
Key Entities Referenced
Insolvency and Bankruptcy Board of India: A regulatory body in India that oversees insolvency proceedings and regulates insolvency professionals.
Insolvency and Bankruptcy Code, 2016: An Indian law that consolidates and amends laws relating to reorganization and insolvency resolution of corporate persons, partnership firms and individuals.
Insolvency Professional: Professionals who administer the resolution process, manage the assets of the debtor, and provide information for creditors to assist them in decision making.
Insolvency Professionals Amendment Regulations, 2019: Regulations that amend the Insolvency and Bankruptcy Board of India Insolvency Professionals Regulations.
Advocates Act, 1961: An act to amend and consolidate the law relating to legal practitioners and to provide for the constitution of Bar Councils.
Bar Council: A statutory body constituted under the Advocates Act, 1961 to regulate and represent the legal profession.
M. S. Sahoo: Chairperson of the Insolvency and Bankruptcy Board of India.
New Delhi: The location where the notification was issued and published, likely referring to New Delhi, Delhi.
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EXTRAORDINARY
Hkkx III—[k.M 4
PART III—Section 4
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PUBLISHED BY AUTHORITY
la- 257] ubZ fnYyh] eaxyokj] tqykbZ 23] 2019@Jko.k 1] 1941
No. 257] NEW DELHI, TUESDAY, JULY 23, 2019/SHRAVANA 1, 1941
भभभभााााररररततततीीीीयययय (cid:8)(cid:8)(cid:8)(cid:8)ददददववववााााललललाााा औऔऔऔरररर शशशशोोोोधधधधनननन अअअअ(cid:18)(cid:18)(cid:18)(cid:18)ममममतततताााा बबबबोोोोडडडड(cid:22)(cid:22) (cid:22)(cid:22)
अअअअििििधधधधससससचचूूचचूू ननननाााा
नई (cid:4)द(cid:6)ली, 23 जुलाई, 2019
भभभभााााररररततततीीीीयययय (cid:8)(cid:8)(cid:8)(cid:8)ददददववववााााललललाााा औऔऔऔरररर शशशशोोोोधधधधनननन अअअअ(cid:18)(cid:18)(cid:18)(cid:18)ममममतततताााा बबबबोोोोडडडड (cid:22)(cid:22) (cid:22)(cid:22)(((((cid:8)(cid:8)(cid:8)(cid:8)ददददववववााााललललाााा (cid:24)(cid:24)(cid:24)(cid:24)ााााववववससससााााििििययययकककक)))) ((((ससससशशंंशशंं ोोोोधधधधनननन)))) ििििववववििििननननययययमममम,,,, 2222000011119999
फफफफाााा....सससस...ंं.ंं आआआआईईईई....बबबबीीीी....बबबबीीीी....आआआआईईईई..../2222000011119999----22220000/जजजजीीीी....एएएएनननन..../आआआआरररर....ईईईई....जजजजीीीी.000044445555....—भारतीय (cid:4)दवाला और शोधन अ(cid:21)मता बोड,(cid:25) (cid:4)दवाला
और शोधन अ(cid:21)मता सिं हता, 2016 (2016 का 31) क& धारा 240 के साथ प+ठत धारा 196, धारा 207 और धारा 208
.ारा /द0 शि1य2 का /योग करत े 4ए, भारतीय (cid:4)दवाला और शोधन अ(cid:21)मता बोड (cid:25) ((cid:4)दवाला 6ावसाियक) िविनयमन,
2016 का और संशोधन करने के िलए िन7िलिखत िविनयम बनाता ह,ै अथा(cid:25)त:् -
1. (1) इन िविनयम2 का सिं (cid:21); नाम भारतीय (cid:4)दवाला और शोधन अ(cid:21)मता बोड (cid:25) ((cid:4)दवाला 6ावसाियक) (सशं ोधन)
िविनयम, 2019 ह ै।
(2) य ेराजप= म> उनके /काशन क& तारीख को /वृ0 ह2गे ।
2. भारतीय (cid:4)दवाला और शोधन अ(cid:21)मता बोड (cid:25) ((cid:4)दवाला 6ावसाियक) िविनयमन, 2016 (िजBह > इसके पCात ् मूल िविनयम
कहा गया ह)ै के िविनयम 2 के उप-िविनयम (1) म,> खंड (क) के Fथान पर िन7िलिखत खंड रखे जाएंगे, अथा(cid:25)त:्–
‘(क) “िनयत काय (cid:25) (असाइनमट> )” से (cid:4)कसी (cid:4)दवाला 6ावसाियक का अतं +रम समाधान 6ावसाियक, समाधान
6ावसाियक, प+रसमापक, शोधन अ(cid:21)मता Bयासी, /ािधकृत /ितिनिध या संिहता के अधीन (cid:4)कसी अBय भिू मका म >कोई
िनयत काय(cid:25) अिभ/ते ह;ै
(कक) “िनयत काय(cid:25) (असाइनमट> ) के िलए /ािधकार” स े (cid:4)कसी (cid:4)दवाला 6ावसाियक एजस> ी .ारा (cid:4)कसी ऐस े (cid:4)दवाला
6ावसाियक को, जो उसका 6ावसाियक सदFय ह,ै उसक& उप-िविधय2 के अनुसार जारी (cid:4)कसी िनयत काय (cid:25) को आरंभ
करने का /ािधकार अिभ/ेत ह;ै
3755 GI/2019 (1)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC. 4]
(कख) “िविधK प+रषद ् (बॉर काउंिसल)” से अिधव1ा अिधिनयम, 1961 (1961 का 25) के अधीन ग+ठत कोई िविधK
प+रषद ्अिभ/ेत ह;ै’।
3. मलू िविनयम2 म,> िविनयम 7 के पCात् िन7िलिखत िविनयम अंतःFथािपत (cid:4)कया जाएगा, अथा(cid:25)त:्–
““““ििििननननययययतततत ककककाााायययय (cid:22)(cid:22) (cid:22)(cid:22)ककककेेेे ििििललललएएएए (cid:30)(cid:30)(cid:30)(cid:30)ााााििििधधधधककककाााारररर
7क. कोई (cid:4)दवाला 6ावसाियक 31 (cid:4)दसQबर, 2019 के पCात ् तब तक कोई िनयत काय(cid:25) Fवीकार या हाथ म> नहR
लेगा जब तक (cid:4)क वह, यथािFथित, ऐसे िनयत काय(cid:25) के Fवीकार या /ारंभ करने क& तारीख को कोई िविधमाBय /ािधकार
धा+रत न करता हो:
परBत ुइस िविनयम के उपबधं ऐसे (cid:4)कसी िनयत काय (cid:25)को लाग ूनहR ह2गे िजसे कोई (cid:4)दवाला 6ावसाियक –
(क) 31 (cid:4)दसQबर, 2019; या
(ख) िनयत काय(cid:25) के िलए उसके /ािधकार के अवसान क& तारीख,
को आरंभ कर रहा ह ै।”।
4. मलू िविनयम2 म,> अSयाय शीष(cid:25) IV के Fथान पर िन7िलिखत अSयाय शीष (cid:25)रखा जाएगा, अथा(cid:25)त ्:–
““““अअअअ(cid:31)(cid:31)(cid:31)(cid:31)ययययाााायययय IIIIVVVV
ििििननननययययतततत ककककाााायययय (cid:22)(cid:22) (cid:22)(cid:22)ककककेेेे ििििललललएएएए (cid:30)(cid:30)(cid:30)(cid:30)ााााििििधधधधककककाााारररर जजजजााााररररीीीी ककककररररननननाााा औऔऔऔरररर उउउउससससककककाााा अअअअ""""ययययपपपपणणण(cid:22)(cid:22)ण(cid:22)(cid:22) ततततथथथथाााा अअअअननननशशुुशशुु ााााससससििििननननकककक ककककााााययययवव(cid:22)(cid:22)वव(cid:22)(cid:22) ााााििििहहहहययययाााा””””ंंंं ।।।।
5. मलू िविनयम के िविनयम 10 म,> उप-िविनयम (1) के Fथान पर िन7िलिखत उप-िविनयम रखा जाएगा, अथा(cid:25)त:्–
“(1) कोई (cid:4)दवाला 6ावसाियक एज>सी जब वह -
(क) िनयत काय(cid:25) के िलए कोई /ािधकार जारी करती ह ैया उसका नवीकरण करती ह;ै
(ख) िनयत काय(cid:25) के िलए (cid:4)कसी /ािधकार को िनलिं बत या रU करती ह;ै
(ग) िनयत काय(cid:25) के िलए (cid:4)कसी /ािधकार का /ितसंहरण या िनलंबन करती ह;ै
(घ) िनयत काय(cid:25) के िलए (cid:4)कसी /ािधकार के अVयप(cid:25)ण को Fवीकार करती ह,ै
ऐसी कार(cid:25)वाई करने के एक काय (cid:25)(cid:4)दवस के भीतर बोड (cid:25)को सिू चत करेगी।” ।
6. मलू िविनयम2 के िविनयम 11 के उप-िविनयम (8) म>, खंड (ख) के पCात् िन7िलिखत खडं रखा जाएगा, अथा(cid:25)त:्–
“(खक) िनयत काय(cid:25) के िलए /ािधकार का िनलंबन या रUकरण;”।
7. मलू िविनयम2 क& पहली अनसु ूची म,>-
(क) खंड 3 के पCात् िन7िलिखत खंड अंतःFथािपत (cid:4)कया जाएगा, अथात(cid:25) :्–
“3क. (cid:4)दवाला 6ावसाियक को, जब कभी िनयत काय (cid:25) के दौरान कोई िहत-संघष (cid:25) उसके सामने आता ह,ै ऐस े (cid:4)कसी
िहत-सघं ष(cid:25) के [यौरे िहतधारक2 को /कट करन ेचािहए ं।”;
(ख) खडं 23 के Fथान पर िन7िलिखत खंड रखे जाएंगे, अथा(cid:25)त:्–
“23. (cid:4)कसी (cid:4)दवाला 6ावसाियक को, जब वह िनयत काय(cid:25) के िलए कोई िविधमाBय /ािधकार धारण करता ह ैया जब
वह (cid:4)कसी िनयत काय (cid:25)को कर रहा ह,ै कोई िनयोजन नहR करना चािहए ।¹Hkkx IIIµ[k.M 4º Hkkjr dk jkti=k % vlk/kj.k 3
23क. जहा ं (cid:4)कसी (cid:4)दवाला 6ावसाियक न े (cid:4)कसी कारपोरेट (cid:4)दवाला समाधान /(cid:4)\या का संचालन (cid:4)कया ह ै वहां वह
और उसके नातेदार, ऐसे (cid:4)कसी लेनदार, िजसक& मतदान शि1 दस /ितशत स े अिधक ह,ै सफल समाधान आवेदक, कारपोरेट
ऋणी या उनस ेसंब^ (cid:4)कसी प(cid:21)कार को, सिं हता के अधीन दी जान ेवाली सेवा_ स ेिभ‘ कोई 6ावसाियक सेवाएं /दान नहR
कर>गे या खलु ी /ितयोिगता भतa के माSयम स े/ा; िनयोजन से िभ‘ कोई िनयोजन तब तक Fवीकार नहR कर>गे जब तक ऐसी
/(cid:4)\या से उसके िवराम क& तारीख से एक वष(cid:25) क& अविध 6तीत न हो गई हो ।
23ख. कोई (cid:4)दवाला 6ावसाियक, अपने (cid:4)कसी िनयत काय(cid:25) से संबंिधत (cid:4)कसी काय(cid:25) के िलए या उसके संबंध म > अपन े
(cid:4)कसी नातेदार या संब^ प(cid:21)कार को नहR लगाएगा या िनयु1 करेगा ।
23ग. कोई (cid:4)दवाला 6ावसाियक, ऐस े (cid:4)कसी िनयत काय (cid:25) के िलए या उसके संबंध म>, जो उसके (cid:4)कसी नातेदार या
संब^ प(cid:21)कार .ारा (cid:4)कया जा रहा ह,ै कोई सेवा उपल[ध नहR कराएगा ।
(cid:1)(cid:1)(cid:1)(cid:1)पपपप(cid:3)(cid:3)(cid:3)(cid:3)ीीीीककककररररणणणण –––– खंड 23क स े 23ग के /योजनाथ,(cid:25) “संब^ प(cid:21)कार” का वहR अथ(cid:25) होगा जो धारा 5 के खंड (24क) म>
उसका ह ै (cid:4)कBत ु इसके अंतग(cid:25)त ऐसी (cid:4)दवाला 6ावसाियक संFथा नहR आती ह,ै िजसका (cid:4)दवाला 6ावसाियक एक भागीदार या
िनदशे क ह ै।”।
डॉ. एम. एस. साb, अSय(cid:21)
[िवKापन-III/4/असा./143/19]
))))टटटट++++पपपपणणणण:::: भारतीय (cid:4)दवाला और शोधन अ(cid:21)मता बोड (cid:25) ((cid:4)दवाला 6ावसाियक) िविनयमन, 2016, भारत के राजप=,
असाधारण, भाग III, खंड 4, सं. 424, तारीख 23 नवQबर, 2016 म> अिधसूचना स.ं आई.बी.बी.आई./2016-
17/जी.एन./आर.ई.जी.003, तारीख 23 नवQबर, 2016 .ारा /कािशत (cid:4)कए गए थ ेऔर तcपCात् -
(1) भारत के राजप=, असाधारण, भाग III, खंड 4, सं. 125, तारीख 28 माच(cid:25), 2018 म > अिधसूचना सं.
आई.बी.बी.आई./2017-18/जी.एन./आर.ई.जी.027, तारीख 27 माच(cid:25), 2018 .ारा /कािशत भारतीय (cid:4)दवाला और शोधन
अ(cid:21)मता बोड (cid:25)((cid:4)दवाला 6ावसाियक) (संशोधन) िविनयम, 2018; और
(2) भारत के राजप=, असाधारण, भाग III, खंड 4, सं. 384, तारीख 11 अ1ूबर, 2018 म> अिधसूचना सं.
आई.बी.बी.आई./2018-19/जी.एन./आर.ई.जी.036, तारीख 11 अ1ूबर, 2018 .ारा /कािशत भारतीय (cid:4)दवाला और
शोधन अ(cid:21)मता बोड (cid:25)((cid:4)दवाला 6ावसाियक) (दसू रा सशं ोधन) िविनयम, 2018
.ारा उनम> संशोधन (cid:4)कए गए।
INSOLVENCY AND BANKRUPTCY BOARD OF INDIA
NOTIFICATION
New Delhi, the 23rd July, 2019
Insolvency and Bankruptcy Board of India (Insolvency Professionals) (Amendment) Regulations, 2019
F. No. IBBI/2019-20/GN/REG045.—In exercise of the powers conferred by sections 196, 207 and 208 read
with section 240 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Insolvency and Bankruptcy Board of
India hereby makes the following regulations further to amend the Insolvency and Bankruptcy Board of India
(Insolvency Professionals) Regulations, 2016, namely: -
1. (1) These regulations may be called the Insolvency and Bankruptcy Board of India (Insolvency Professionals)
(Amendment) Regulations, 2019.
(2) They shall come into force on the date of publication in the Official Gazette.
2. In the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016 (hereinafter referred to
as the principal regulations), in regulation 2, in sub-regulation (1), for clause (a), the following clauses shall be
substituted, namely:-4 THE GAZETTE OF INDIA : EXTRAORDINARY [PART III—SEC. 4]
‘(a) “assignment” means any assignment of an insolvency professional as interim resolution professional, resolution
professional, liquidator, bankruptcy trustee, authorised representative or in any other role under the Code;
(aa) “authorisation for assignment” means an authorisation to undertake an assignment, issued by an insolvency
professional agency to an insolvency professional, who is its professional member, in accordance with its bye-laws;
(ab) “Bar Council” means a Bar Council constituted under the Advocates Act, 1961 (25 of 1961);’.
3. In the principal regulations, after regulation 7, the following regulation shall be inserted, namely: -
“Authorisation for assignment.
7A. An insolvency professional shall not accept or undertake an assignment after 31st December, 2019 unless he holds a
valid authorisation for assignment on the date of such acceptance or commencement of such assignment, as the case may
be:
Provided that provisions of this regulation shall not apply to an assignment which an insolvency professional is
undertaking as on-
(a) 31st December, 2019; or
(b) the date of expiry of his authorisation for assignment.”.
4. In the principal regulations, for Chapter heading IV, the following Chapter heading shall be substituted, namely:-
“CHAPTER IV
ISSUE AND SURRENDER OF AUTHORISATION FOR ASSIGNMENT AND DISCIPLINARY
PROCEEDINGS”.
5. In the principal regulations, in regulation 10, for sub-regulation (1), the following sub-regulation shall be substituted,
namely: -
“(1) An insolvency professional agency shall inform the Board when it-
(a) issues or renews an authorisation for assignment;
(b) suspends or cancels an authorisation for assignment;
(c) revokes the suspension of an authorisation for assignment; or
(d) accepts the surrender of an authorisation for assignment,
within one working day of taking such action.”.
6. In the principal regulations, in regulation 11, in sub-regulation (8), after clause (b), the following clause shall be
inserted, namely: -
“(ba) suspension or cancellation of authorisation for assignment;”.
7. In the principal regulations, in the First Schedule, -
(a) after clause 3, the following clause shall be inserted, namely: -
“3A. An insolvency professional must disclose the details of any conflict of interests to the stakeholders, whenever
he comes across such conflict of interest during an assignment.”;
(b) for clause 23, the following clauses shall be substituted, namely: -
“23. An insolvency professional must not engage in any employment when he holds a valid authorisation for
assignment or when he is undertaking an assignment.
23A. Where an insolvency professional has conducted a corporate insolvency resolution process, he and his relatives
shall not accept any employment, other than an employment secured through open competitive recruitment, with, or
render professional services, other than services under the Code, to a creditor having more than ten percent voting power,
the successful resolution applicant, the corporate debtor or any of their related parties, until a period of one year has
elapsed from the date of his cessation from such process.
23B. An insolvency professional shall not engage or appoint any of his relatives or related parties, for or in connection
with any work relating to any of his assignment.¹Hkkx IIIµ[k.M 4º Hkkjr dk jkti=k % vlk/kj.k 5
23C. An insolvency professional shall not provide any service for or in connection with the assignment which is being
undertaken by any of his relatives or related parties.
Explanation.- For the purpose of clauses 23A to 23C, “related party” shall have the same meaning as assigned to it in
clause (24A) of section 5, but does not include an insolvency professional entity of which the insolvency professional is a
partner or director.”.
Dr. M. S. SAHOO, Chairperson
[ADVT.-III/4/Exty./143/19]
Note: The Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016 were published vide
notification No. IBBI/2016-17/GN/REG003 dated 23rd November, 2016 in the Gazette of India, Extraordinary,
Part III, Section 4, No. 424 on 23rd November, 2016 and were subsequently amended by-
(1) The Insolvency and Bankruptcy Board of India (Insolvency Professionals) (Amendment) Regulations, 2018 published
vide notification No. IBBI/2017-18/GN/REG027 dated 27th March, 2018 in Gazette of India, Extraordinary, Part III,
Section 4, No. 125 on 28th March, 2018; and
(2) The Insolvency and Bankruptcy Board of India (Insolvency Professionals) (Second Amendment) Regulations, 2018
published vide notification No. IBBI/2018-19/GN/REG036 dated 11th October, 2018 in Gazette of India, Extraordinary,
Part III, Section 4, No. 384 on 11th October, 2018.
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and Published by the Controller of Publications, Delhi-110054.