The Insolvency and Bankruptcy Board of India (IBBI) the regulatory body of maintaining law and practice relating to bankruptcy and insolvency in the country observed that in the entire insolvency ecosystem, the Committee of Creditors (CoCs) are the only bodies, which do not have any regulation, whereas other stakeholders like insolvency professionals, valuation professionals and Corporate Debtors are governed by statutory regulations.
IBBI will hold a board meeting next week to discuss the Code of Conduct (Ethics) for the CoC involved in insolvency cases in the wake of deep haircuts taken by the banks and financial institutions in recent cases of insolvency resolution. Sources in the Ministry of Corporate Affairs have pointed out that if the Code of Conduct is approved by the IBBI board, they will be notified soon. "IBBI board will deliberate on the discussion paper on the Code of Conduct for CoC in its meeting on 27 September. If the board approves them, the same will be notified by the mid of the next month," a government source told. The source pointed out that no amendment to the Insolvency and Bankruptcy Code is needed for the implementation of the Code of Conduct for the creditors, and that the rules will be notified under the IBBI regulations.