- 19-Apr-2025
- Healthcare and Medical Malpractice
The Insolvency and Bankruptcy Board of India (IBBI) is a key regulatory body established under the Insolvency and Bankruptcy Code (IBC) to oversee and regulate the insolvency and bankruptcy proceedings in India. It plays a vital role in ensuring the smooth functioning of the insolvency process, maintaining standards, and fostering a transparent and efficient insolvency resolution mechanism.
IBBI is responsible for regulating insolvency professionals who are crucial in the insolvency resolution process (IRP) and liquidation proceedings. It ensures that insolvency professionals (IPs) are adequately qualified, follow a strict code of conduct, and adhere to ethical standards.
The IBBI issues certification for professionals who act as resolution professionals, liquidators, and bankruptcy trustees. They must comply with the regulations established by IBBI to maintain their professional standing.
IBBI ensures that the insolvency resolution process under the IBC is carried out in a timely and efficient manner. It monitors the progress of cases to prevent undue delays and ensures that the Committee of Creditors (CoC) and resolution professionals are adhering to the framework laid out in the IBC.
The board helps ensure that Corporate Insolvency Resolution Process (CIRP) is conducted according to the rules and that any issues are resolved in compliance with the law.
IBBI ensures that all stakeholders in the insolvency and bankruptcy process, including companies, creditors, insolvency professionals, and other entities, follow the provisions of the Insolvency and Bankruptcy Code (IBC).
It develops guidelines and regulations for the effective implementation of the IBC, making sure that all parties act in accordance with the principles of transparency, accountability, and fairness.
IBBI also oversees information utilities (IUs) that maintain electronic records of financial data and facilitate access to reliable data for creditors and resolution professionals. These IUs are vital for the insolvency resolution process, as they provide reliable and accurate information about a company’s financial position.
The board ensures that these information utilities comply with the standards set by the IBBI.
IBBI works to build capacity and promote research and development in the field of insolvency and bankruptcy. It organizes training programs, workshops, and seminars to improve the knowledge and skills of professionals involved in insolvency resolution.
It encourages the development of best practices and fosters a culture of continuous improvement in the insolvency ecosystem.
IBBI monitors the performance of insolvency professionals, resolution applicants, and other entities involved in the insolvency process to ensure they comply with legal and regulatory norms.
The board has the authority to take disciplinary action against any party found violating the rules and regulations. This could include fines, suspension, or even disqualification from acting in insolvency proceedings.
Investigating non-compliance: IBBI investigates complaints related to insolvency processes and can take corrective measures to enforce compliance with the IBC.
IBBI plays a significant role in the development and evolution of the insolvency and bankruptcy framework in India by issuing rules, guidelines, and regulations that keep pace with changes in the economic and business environment.
It ensures that the provisions of the IBC align with global best practices and are practical and effective for the Indian context.
While the Committee of Creditors (CoC) primarily decides on Resolution Plans, IBBI plays an oversight role in ensuring that the plans meet legal requirements and are fair and reasonable.
It works with other regulatory authorities to assess the impact of Resolution Plans on stakeholders, including creditors, employees, and shareholders.
IBBI regulates and monitors the functioning of Insolvency Professional Agencies (IPA) and Insolvency Professional Entities (IPE), which are responsible for the training, certification, and regulation of insolvency professionals.
These agencies are authorized by IBBI to ensure that insolvency professionals operate within the legal framework and follow ethical standards.
IBBI plays a role in addressing disputes that may arise during the insolvency and bankruptcy proceedings. It works to ensure that all disputes are handled in an impartial, fair, and transparent manner.
If a company under Corporate Insolvency Resolution Process (CIRP) is experiencing delays due to improper conduct by the resolution professional, creditors may lodge a complaint with the IBBI. IBBI will investigate the matter, and if necessary, take action against the professional for non-compliance with the regulations, which could include suspension or removal from the case.
The Insolvency and Bankruptcy Board of India (IBBI) is the central regulatory authority responsible for overseeing and ensuring the proper implementation of the Insolvency and Bankruptcy Code (IBC) in India. Its primary roles include regulating insolvency professionals, ensuring compliance with IBC provisions, promoting best practices, and taking action against non-compliance. Through these functions, IBBI plays a critical role in ensuring that the insolvency process is fair, transparent, and efficient, helping to create a more reliable and accountable insolvency framework in India.
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