India’s corporate affairs ministry issued final rules for registering and regulating insolvency professional agencies, which will be critical facets in the introduction of India’s bankruptcy code.
Under the rules, a company must have a minimum net worth of $1.6 million and paid-up share capital of $800,000 to qualify for registration as an insolvency professional agency (IPA). Control of the IPA will be with Indian residents. IPAs will need to ensure compliance with the regulations and guidelines issued under the Bankruptcy Code. The regulations further require a minimum of seven directors on every IPA governing board, reports Mint.
The law on bankruptcy will apply to individuals, companies, limited liability partnerships and partnership firms, as well as corporations, and it will create a complementary ecosystem, including insolvency professionals, information utilities and a bankruptcy regulator.