Introduction

• The Insolvency and Bankruptcy Board of India (IBBI) has an impact of the economic landscape of India by overseeing the insolvency and bankruptcy proceedings in the country.
• It is a statutory and regulatory body established on 1^st October 2016 that regulates insolvency professionals, insolvency professional agencies, and information utilities, while also promoting transparency and efficiency in the resolution process.
• IBBI assumes quasi-judicial functions as well. Thus, the role of IBBI is by and large administrative, regulatory, IBBI enforcement- oriented and quasi-judicial in nature.

What is the Historical Background of IBBI?

• The idea of a dedicated insolvency and bankruptcy regulatory authority gained momentum with the realization that an efficient and time-bound resolution mechanism is crucial for maintaining the health of the Indian economy.
• The Insolvency and Bankruptcy Code (IBC), enacted in 2016, laid the foundation for the establishment of the Insolvency and Bankruptcy Board of India.
• The IBC consolidated and amended the laws relating to reorganization and insolvency resolution of corporate persons, partnership firms, and individuals.
• The establishment of the IBBI marked a paradigm shift in the approach towards insolvency and bankruptcy in India.
  • The earlier system was marked by fragmented legal frameworks and delays in resolution, leading to significant economic inefficiencies.
• The IBBI aimed to streamline and expedite the resolution process, providing a more conducive environment for businesses to thrive.

What is the Structure of IBBI?

Organization Structure

• The IBBI operates with a structured framework, comprising a Chairperson and three whole-time members.
• The Chairperson and whole-time members are appointed by the government, bringing together individuals with expertise in the fields of finance, law, and insolvency.
• It also has ex-officio members.

Officers

• The board is supported by a team of professionals responsible for various functions, including regulatory affairs, administration, finance, and enforcement.
• This team of officers consists of the Manager, Assistant General Manager, Deputy General Manager, Chief General Manager, Executive Director.

What are the Functions of IBBI?

Section 194 of the IBC covers the functions of IBBI:

• Regulatory Functions:
  • The IBBI formulates and enforces regulations and guidelines for various entities involved in the insolvency resolution process.
  • The regulatory framework aims to bring consistency, transparency, and efficiency to the insolvency resolution process.
• Advisory Functions:
  • The IBBI acts as an advisory body to the government on matters related to insolvency and bankruptcy.
  • It provides recommendations and insights into the evolving economic landscape, helping policymakers make informed decisions to strengthen the insolvency framework in the country.
• Educational Functions:
  • Recognizing the importance of building a skilled workforce in the field of insolvency, the IBBI is actively involved in educational initiatives.
  • It conducts examination for enrollment of insolvency professionals, educational programs, workshops, and training sessions to enhance the knowledge and skills of insolvency professionals, creating a pool of qualified individuals to handle complex insolvency cases.