The government has set the ball rolling for selection of the next Chairman of the Insolvency and Bankruptcy Board of India (IBBI), inviting applications for the regulator’s post.

The current Chairman MS Sahoo is due to complete his five year term in September and he is unlikely to seek reappointment, sources said.

A four weeks window is available for prospective applicants to submit their applications to the Corporate Affairs Ministry. The IBBI Chairman is appointed by the Central government based on the recommendations of the Selection Committee headed by the Cabinet Secretary.

“The fact that the government has commenced the process of selection of a insolvency regulator at least four months in advance is really commendable,” said economy watchers. This is especially so given the way the process had commenced in respect of other regulators like IRDAI, when the exercise got woefully delayed and things started to move after the incumbent demitted office, they noted.

It maybe recalled that the insolvency and bankruptcy code (IBC) was enacted in 2016 and received the assent of the President on May 28. Sahoo had assumed charge as the Chairman of IBBI in September 2016.

IBC has been a landmark legislation as it has played a critical role--despite several legal challenges-- in bringing improvements in the system for resolving stress and rescue of companies facing bankruptcy. Although lenders had to take sizeable haircuts in several cases, the new creditor in control model has kept promoters on their toes as they now fear the prospect of losing control of their entities if the debt defaults persisted.

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