Recent Key Developments Under The Insolvency And Bankruptcy Code

In the past few months, the Central Government and the Insolvency and Bankruptcy Board of India ('IBBI') have introduced several changes to the Insolvency and Bankruptcy Code, 2016 ('IBC') and the regulations issued thereunder. Some of the important changes introduced by the amendments have been discussed below.

1. Insolvency and Bankruptcy Code (Amendment) Ordinance, 2019 ('Ordinance') (operative with effect from December 28, 2019)

Some of the key aspects of the Ordinance are summarized below:

i. 'Interim finance' under the IBC means any financial debt raised by the corporate debtor after insolvency commencement date. The Ordinance expands the scope of interim finance to any other debt that may be notified. No such notification has been made till date. However, it is expected that certain categories of last mile financing made available to distressed companies in the zone of insolvency may be notified as interim finance.