The regulator put forward some significant changes in the regulations of Insolvency Professionals. This proposal may require to acquire a Certificate of Practice for all Resolution Professionals, Liquidation, or Interim Resolution Professional that authorize the IPs practice. The Insolvency and Bankruptcy Board of India (IBBI) is of the idea that Certification of Practice will enhance supervising the IPs practice and help to avoid needless disciplinary proposal.
According to the proposal of Insolvency regulator IBBI, every registered IP must have a Certificate of Practice (CoP) and they should be renewed in yearly basis from IPA (Insolvency Professional Agency. This will, however, rise the responsibility on IPAs, as it allows a registered Insolvency Professional to start and quit practice as and when required. Conflict of interest IBBI has also proposed for addressing the ‘conflict of interest’ issues to the IP regulations. IBBI put forward to disallow IPs, their relatives and linked parties from interim as a Liquidator/IRP/RP in a process.
They would also be forbidden from the execution of professional services in any other volume in relation to a process if any of them is acting as a Liquidator/IRP/RP. It is also suggested that an extra criterion of close business connection between the relatives may be created to avoid challenges and hurdles as being arbitrary.
Upper age limit The Insolvency and Bankruptcy Board of India (IBBI) has proposed that Insolvency Professionals above 70 years may not be issued Certificate of Practice and they may not be permitted to take up progressions in their own name. However, they may encourage younger Insolvency Professionals for IPEs (Insolvency Professional Entity) in employment. However, the regulators proposed that since the certificate is mandatory to be renewed every year, it should be ensured that the renewal process doesn't itself become bureaucratic causing ambiguity in the availability of RPs.
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