Ministry of Corporate Affairs notifies IBC Rules, 2019: Report
The Ministry of Corporate Affairs on November 15 has notified the Insolvency and Bankruptcy Rules, 2019, CNBC-Tv18 reports.
The news rules will apply to financial service providers under section 227. The Corporate Insolvency Resolution Process (CIRP) of a financial services provider (FSP) will be initiated only on an application by the appropriate regulator, according to CNBC-TV18.
However, the special framework under section 227 of the Insolvency Code shall not apply to banks.
Once the application to that effect is admitted, the adjudicating authority is required to appoint an administrator. The administrator shall have the same responsibilities and powers as that of an insolvency professional, the government told CNBC-TV18.
The regulator may form a panel to advise the administrator in operations of the financial services provider during the insolvency resolution process.
The report also noted that the administrator shall take control of third party assets in possession of the financial services provider (FSP.)
The provision of moratorium would not be applicable to third party assets in custody of the FSP, and the its license and registration would not be suspended/cancelled during interim-moratorium and during the proceedings of the CIRP.Get access to India’s fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code “GETPRO”. Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.