NEW DELHI: The pre-pack framework for stressed assets under the insolvency law is a “liquidation-remote resolution mechanism” and will also help in avoiding protracted legal battles as there will already be a broad understanding among stakeholders concerned, according to IBBI chief M S Sahoo.
To help stressed MSMEs (Micro, Small and Medium Enterprises), the government has come up with the pre-packaged resolution mechanism for such entities under the Insolvency and Bankruptcy Code (IBC). The provision has been introduced by way of an ordinance amending the IBC.
The country’s insolvency law’s main feature is creditor-in-control, where creditors have unfettered rights to decide on the future course of a stressed company.
“In corporate in…
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