Feedback

IBBI Introduces Amendments to Information Utilities Regulations, 2024

On August 13, 2024, the Insolvency and Bankruptcy Board of India (IBBI) officially announced amendments to the Information Utilities Regulations, 2017. These changes are set to enhance the efficiency and transparency of information management in insolvency proceedings, with specific regulations coming into effect from October 1, 2024, and December 1, 2024.

Key Amendments to the IBBI Regulations

The latest amendments introduced by the IBBI aim to streamline the process of managing insolvency-related information, particularly in the verification and authentication of defaults. These changes have been incorporated under the Insolvency and Bankruptcy Code, 2016, with an emphasis on improving the functionality of Information Utilities.

Overview of the Amendments

The key amendments in the Information Utilities Regulations, 2024, include:

Extended Timeframes:

• The time for information submission has been extended from the originally specified period in the Technical Standards to seven days.
• The submission period for specific documentation has also been revised to seven days.

Updated Provisions for Creditors:

• The amendments now allow financial creditors, particularly those listed in the second schedule of the Reserve Bank of India Act, 1934, to submit records in Form C for non-corporate debtors.
• In cases where a debtor disputes a part of or the entire default amount, the information utility must record this dispute with a status of "disputed" while authenticating the undisputed amount as "authenticated."

Enhanced Verification Processes

One of the critical updates in the amendments is the introduction of a robust verification process before issuing a record of default:

• Mandatory Verification: Information utilities must now verify key details such as the debtor’s email address, proof of debt, the latest acknowledgment of debt, and proof of default before issuing any record of default.
• Handling Disputes: If a debtor disputes any portion of the default amount, they are required to provide reasons and evidence for the dispute, which will then be recorded by the information utility.

Implementation Timeline

The amendments will be implemented in two phases: