Insolvency and Bankruptcy Board of India has issued amendments to the IBBI (Model Bye-Laws and Governing Board of Insolvency Professional Agencies) Regulations, 2016. The amendments affect Regulation 5 and Regulation 5A of the principal regulations.

In Regulation 5, the following amendments are made:

(i) in sub-regulation (1), in clause (b), the word “and” occurring at the end, shall be omitted;

(ii) in sub-regulation (1), in clause (c), for the punctuation mark “:” occurring at the end, the words and punctuation mark “; and” shall be substituted;

(iii) in sub-regulation (1), after clause (c) the following clause shall be inserted, namely:— “(d) nominee director.”;

(iv) in the proviso to sub-regulation (1), after the words “minimum seven directors”, the words “excluding the nominee director” shall be inserted;

(v) in sub-regulation (6),

(a) in clause (g), for the punctuation mark “.” occurring at the end, the punctuation mark “;” shall be substituted;

(b) after clause (g), the following clauses shall be inserted, namely:—

“(h) who is not a member of any statutory regulator that has sponsored or promoted the insolvency professional agency, or that directly or indirectly holds shareholding in, or exercises control over, such insolvency professional agency; and

 (i) who is not an independent director of any other insolvency professional agency.”

(vi) for sub-regulation (9), the following shall be substituted namely:—

“(9) The second term referred to in sub-regulation (8) shall be subject to a satisfactory performance review of the first term by the Governing Board and prior approval of the Board.”;

(vii) after sub-regulation (14), the following sub-regulation shall be inserted, namely:—

“(15) The Board shall nominate one individual as its nominee director on the Governing Board of an insolvency professional agency, and such nominee director shall have the same status, rights, duties, powers and responsibilities as other directors of the governing board.”

In Regulation 5A, after sub-regulation (6), the following sub-regulation shall be inserted, namely:—

“(6A) For the purpose of obtaining prior approval of the Board under sub-regulation (6) for appointment or renewal of appointment of the managing director, an insolvency professional agency shall forward not less than two names to the Board, at least one month prior to the expiry of the tenure of the existing managing director.”