IBBI amends the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016

IBBI amends the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016

The Insolvency and Bankruptcy Board of India (IBBI) vide notification dated 04.07.22 in the Gazette of India Extraordinary amended the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016 (Principal Regulations).

A. Regulation 11 of the Principal Regulations have substituted as:

"Disciplinary Proceedings.

11. The disciplinary proceedings shall be conducted in accordance with the provisions of Insolvency and Bankruptcy Board of India (Inspection and Investigation) Regulations, 2017."

B. The following clauses were inserted:

1. "Clause 8B: An insolvency professional shall disclose his relationship, if any, with the corporate debtor, other professionals engaged by him, financial creditors, interim finance providers, and prospective resolution applicants to the insolvency professional agency of which he is a member within the time specified."

2. "Clause 8C: An insolvency professional shall ensure disclosure of the relationship, if any, of the other professionals engaged by him with himself, the corporate debtor, the financial creditor, the interim finance provider, if any, and the prospective resolution applicant, to the insolvency professional agency of which he is a member, within the time specified"

3. "Clause 8D: An insolvency professional shall ensure timely and correct disclosures by him, and other professionals appointed by him and shall provide a confirmation to the insolvency professional agency of which he is a professional member to the effect that the appointment, if any, of every other professional has been made at arms' length relationship."

4. "Clause 15A: An insolvency professional shall prominently state in all his communications to a stakeholder, his name, address, e-mail, registration number and validity of authorisation for assignment, if any, issued by the insolvency professional agency of which he is a member"

5. "Clause 25B: An insolvency professional shall raise bills or invoices in his name towards his fees, and such fees shall be paid to him through banking channel."

6. "Clause 25C: An insolvency professional shall ensure that the insolvency professional entity or the professional engaged by him raises bills or invoices in their own name towards their fees, and such fees shall be paid to them through banking channel."

7. "Clause 27A: An insolvency professional shall, while undertaking assignment or conducting processes, exercise reasonable care and diligence and take all necessary steps to ensure that the corporate person complies with the applicable laws."

8. "Clause 27B: An insolvency professional shall not include any amount towards any loss, including penalty, if any, in the insolvency resolution process cost or liquidation cost, incurred on account of non-compliance of any provision of the laws applicable on the corporate person while conducting the insolvency resolution process, fast track insolvency resolution process, liquidation process or voluntary liquidation process, under the Code."

These regulations may be called the Insolvency and Bankruptcy Board of India (Insolvency Professionals) (Amendment) Regulations, 2022 and shall come into force on the date of their publication in the Official Gazette.