Board: Top 5 Points to Remember
While registering insolvency professional agency, the Board must remember that professionals are there to promote:
- Professional development and regulation of insolvency professionals.
- Services of competent insolvency professionals.
- Good professional and ethical conduct among insolvency professionals.
- Interests of debtors, creditors and other persons as specified.
- The growth of insolvency professionals agency.
“Every person needs to have a certificate of registration issued on behalf by the Board in order to carry its business as insolvency professional agency under the code”
Divya Gupta (Market Analyst, MUDS Management Pvt Ltd)
Who is Eligible to be Insolvency Professional Agency?
Only if a company registered under section 8 of the Companies Act, 2013 and satisfies conditions, it is eligible to be Insolvency Professional Agency –
- The sole objective is to carry the functions of an insolvency professional agency.
- Has bye-laws and governance structure in accordance with IBBI.
- Has a minimum net worth of 10 crore rupees.
- Has paid-up share capital of 5 crore rupees.
- Is not under control of person(s) resident outside India.
- Not more than 49% of its share capital is held by persons outside India.
- NBFCIs not a subsidiary of a body corporate through more than one layer.
- Itself, its promoters, its directors, and persons holding more than 10% of its share capital are fit and proper persons.
“Every insolvency professional agency needs to make bye-laws in line with the model bye-laws as specified by the Board under sub-section (2) or section 196 subjected to the specifications made in the Code and any rules or regulations made within it and after necessary approvals of the Board”
Isha Malik (Company Secretary, MUDS Management Pvt Ltd)
Top 4 Points about Model Bye-Laws:
- The bye-laws along with the application for the registration need to be submitted to the Board.
- The bye-laws will be applicable for all matters specified in the model bye-laws.
- The bye-laws will hold at all times as the model bye-laws.
- The agency needs to publish its bye-laws, the composition of all committees formed, and all political created under the bye-laws on its website.
Whose over IBBI?
The Board has made regulations in order to ensure that every insolvency professional agency follows the objectives mentioned under the code:
- The setting up of a governing board.
- The minimum number of independent members to be on the governing board.
- The number of insolvency professionals being its members who shall be on the governing board.
“ Modi government has no doubt introduced a very robust insolvency resolution system that will highly benefit the nation”
Shweta Gupta (Founder & CEO, MUDS Management Pvt Ltd)