In a significant development aimed at enhancing monitoring capabilities, the Insolvency and Bankruptcy Board of India (IBBI) has granted Insolvency Professional Entities (IPEs) acting as Insolvency Professionals (IP) the facility to electronically submit insolvency information.
This digital submission capability was previously unavailable to IPEs functioning as IPs.
The move by the insolvency regulator, IBBI, marks a significant step forward in bolstering oversight over the performance of IPEs acting as IPs.
The decision comes approximately a year after IBBI allowed IPEs to register as IPs and engage in activities governed by the Insolvency and Bankruptcy Code (IBC). This was a noteworthy policy shift, as prior to this change, only individual professionals were eligible to register and operate as IPs in India.
Previously, individual IPs were required to submit Corporate Insolvency Resolution Process (CIRP) related information and records to IBBI for monitoring purposes, utilizing the electronic platform hosted on the IBBI’s website. However, no such electronic submission facility was available to IPEs operating as IPs. Consequently, IPEs were unable to submit relevant CIRP Forms for the cases they managed on the IBBI’s website.
However, the IBBI has now rectified this gap by issuing a circular permitting IPEs acting as IPs to electronically submit CIRP forms. This enables the IBBI to monitor the progress and performance of assignments undertaken by these entities.
Under the new arrangement, IPEs will gain access to the IBBI’s platform using unique usernames and passwords provided by the regulatory body.
They can then authorise individual IPs responsible for specific processes to upload and submit the CIRP forms. Subsequently, the authorised IPs will submit the CIRP forms, complete with relevant information and records, using their provided usernames and passwords as individual IPs.
In an effort to facilitate the submission of forms for all assignments managed by IPEs through this newly introduced electronic system, the IBBI has announced that CIRP forms filed until September 30 will not incur any fees. This move is expected to streamline the reporting and oversight processes within the insolvency framework, ultimately benefiting stakeholders and the regulatory authority alike, said experts.
Ashok Haldia, Chairman, Indian Institute of Insolvency Professionals of ICAI (IIIPI) said that the new IBBI circular is to allow IPEs the facility to submit CIRP forms for the purpose of monitoring corporate insolvency resolution processes and performance of insolvency professional entities through its website. With that, it will also not charge fee for the forms filed till 30 September 2023. “It is a welcome move as it will help IBBI and Insolvency Professional Agency (IPA) in monitoring the performance of CIRP handled by IPEs acting as IPs”, Haldia told businessline.