Bankruptcy and Bankruptcy Act (Amendment) Act introduced in Lok Sabha, reviewed by selected committees
A bill introduces a “creditor-launched bankruptcy process” and introduced a true corporate failure out-of-court startup mechanism in Lok Sabha on Tuesday to promote faster and more cost-effective bankruptcy solutions.
Finance Minister Nirmala Sitharaman introduced the Bankruptcy and Bankruptcy Act (Amendment) bill, which was amid the uproar of opposition members, and they were in the face of the special debates of Bihar’s election volume.
Sitharaman proposes to send the Bankruptcy and Bankruptcy Act (Amendment) Act of 2025 to a specific committee. The motion has been approved by the property.
According to a statement of the object and reason of the bill, the proposed amendment is intended to reduce delays, maximize the value of all stakeholders, and improve the governance of all procedures in the Code. They are trying to modify existing regulations to better align with the overall objectives of the Code and introduce new regulations that follow global best practices to address bankruptcy.
“Among other measures, the proposed legislation introduces the creditor-initiated Bankruptcy resolution process “has a true business-under-start mechanism that cannot facilitate faster, more cost-effective bankruptcy solutions and with minimal business disruption.
The proposed legislation also introduces provisions for “group bankruptcy” and “cross-border bankruptcy”.
The Group Bankruptcy Framework is designed to effectively address bankruptcy involving complex corporate group structures, thus minimizing value damage due to fragmented procedures and maximizing the value of creditors through coordinated decision-making.
The cross-border bankruptcy framework is designed to lay the foundation for protecting the interests of stakeholders in litigation at home and abroad, thereby promoting investor confidence and aligning domestic practices with international best practices. This will also pave the way for improving awareness of Indian bankruptcy proceedings in other jurisdictions, the statement said.
