Bankruptcy Law Reforms

On 22nd August 2014, the Ministry of Finance created a committee called the Bankruptcy Legislative Reforms Commission (BLRC), headed by T. K. Viswanathan (Former Union Law Secretary and Secretary General Lok Sabha). The mandate of the BLRC was to draft a new bankruptcy law, along the lines of the work done by the Justice Srikrishna-led Financial Sector Legislative Reforms Commission. The law drafted by the BLRC is a consolidated bankruptcy framework, covering both individuals as well as legal entities, and aims to be a holistic reform of the insolvency resolution process for all entrepreneurs in India. The reforms aim to improve the time taken to resolving insolvency and improve loss given default on repayment on credit. In turn, this can lead to a significant improvement of the ease and cost of doing business in India, and is expected to develop the credit and the debt securities markets.

The Committee submitted its report to the Finance Minister on 4th November 2015. The structure of the report is similar to the work of Justice Srikrishna's FSLRC: the economic rationale and design features of a new legislative framework to resolve insolvency and bankruptcy was in Volume 1 and the draft bill was in Volume 2. A modified version of the draft bill, with public comments incorporated, was tabled in Parliament in the winter session on 23 December 2015. Once it was tabled, a Joint Parliamentary Committee on Insolvency and Bankruptcy Code, 2015 (JPC) was set up to analyse the draft bill in detail. The JPC submitted its report. The report included anew draft of the bill, which was then passed by both houses of Parliament. The bill received President's assent on 28th May, 2016, and is called the Insolvency and Bankruptcy Code, 2016.

The Law

The Insolvency and Bankruptcy Code, 2016.
Ministry of Law and Justice
May 2016
The Joint Parliamentary Committee Report on the Insolvency and Bankruptcy Code, 2015
(with the modified draft of the Code as presented and passed in both
houses of Parliament included in the appendix)
Lok Sabha Secretariat
April 2016

Volume 1: Rationale and drafting instructions
Ministry of Finance
November 2015

Implementation of the law

Report of the Working Group on building the Insolvency and Bankruptcy Board of India.
Ministry of Corporate Affairs
October 2016


Response to policy proposals