The Board of Insolvency and Bankruptcy of India (IBBI) has granted facilities to Insolvency Professional Entities (IPEs) acting as Insolvency Professionals (IPs) to file insolvency information electronically, a significant development aimed at enhancing regulatory capacity.
Previously, this digital submission capability was not available for IPE as IP.
The move by insolvency watchdog IBBI marks an important step forward in strengthening oversight of the performance of IPEs as IP.
The decision comes about a year after IBBI allowed IPE to register as an IP and engage in activities governed by the Insolvency Code (IBC). This is a notable policy shift, as before this change, only individual professionals were eligible to register and operate IP in India.
Previously, individual IP owners had to submit CIRP-related information and records to IBBI for monitoring using an electronic platform hosted on the IBBI website. However, an IPE operating as an IP does not have access to such electronic submission facilities. As a result, IPEs are unable to file relevant CIRP forms for their cases administered on the IBBI website.
However, IBBI has now issued a notice allowing IPEs to submit CIRP forms electronically as IPs, correcting this deficiency. This enables IBBI to monitor the progress and performance of the tasks undertaken by these entities.
“Welcome to move”
Under the new arrangement, the IPE will use a unique username and password provided by the regulator to access the IBBI platform.
They can then authorize individual IPs responsible for specific processes to upload and submit CIRP forms. Subsequently, the authorized IP will use the username and password it provided to submit the CIRP form as a personal IP, and fill in relevant information and records.
To facilitate the submission of all job forms administered by the IPE through this newly introduced electronic system, IBBI has announced that CIRP forms submitted before September 30 will not incur any fees. The move is expected to simplify the reporting and monitoring process within the insolvency framework, ultimately benefitting stakeholders and regulators, experts said.
ICAI Indian Institute of Insolvency Professionals (IIIPI) President Ashok Haldia said the new IBBI circular will allow the agency’s IPEs to file CIRP forms to monitor the corporate insolvency resolution process and insolvency profession via its website Entity performance. This way, there will also be no fee for forms submitted before September 30, 2023. “This is a welcome move as it will help IBBI and the Insolvency Professional Agency (IPA) to monitor the performance of CIRPs handled by the IPE as IPs,” Haldia told career line.