Home > Regions > Asia Pacific > Lok Sabha endorses the Insolvency and Bankruptcy Code (Amendment), 2021

Lok Sabha endorses the Insolvency and Bankruptcy Code (Amendment), 2021

The Finance Minister Nirmala Sitharaman on 26th July 2021 introduced the Insolvency and Bankruptcy Code (Amendment) Bill, 2021 (“Bill”), which was endorsed by Lok Sabha on 28th July 2021. Interestingly, this Bill was passed without any discussions with members of the opposition party, since the opposition leaders were worked up in protesting against the Pegasus snooping issue and the 3 (three) new farm laws tabled before Lok Sabha in the monsoon session.

Prior to such introduction in the Lok Sabha, the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2021 (“Ordinance”) was promulgated by the President of India on 4th April 2021. This Ordinance was introduced in view of the financial impact of the Covid-19 pandemic and subsequent lockdown imposed globally, including India directly affecting micro, small and medium enterprises (MSME’s) and consequently exposed many of them under financial distress.

The detailed reading of the Ordinance