1. Introduction
Professionals are often burdened with extensive paperwork and complex compliance requirements in the fast-paced world of insolvency resolution. Recognising this challenge, the Insolvency and Bankruptcy Board of India (IBBI) has proposed simplifying and streamlining these processes.
During the 27th meeting of the Financial Stability and Development Council (FSDC) on May 8, 2023, a clear directive was issued to reduce the compliance burden on insolvency professionals (IPs) and create an efficient regulatory environment. In response, IBBI released a discussion paper on June 10, 2024, suggesting significant changes to the Corporate Insolvency Resolution Process (CIRP) forms.
The objective is to make compliance easier, faster, and more effective, allowing professionals to focus on resolving insolvency cases efficiently. Let’s explore these proposed changes in detail and understand their potential impact on the industry.
2. Proposed Changes to CIRP Forms
Several significant changes have been proposed to streamline compliance and reduce the burden on insolvency professionals (IPs) for the forms and reporting requirements associated with the Corporate Insolvency Resolution Process (CIRP). These changes are presented in tabular format for better understanding.
Current Form Details Proposed Change
Form IP-1 (Preassignment Form)
Form CIRP-1
Includes consent to accept assignment as IRP/RP, details of IP and the applicant, details of the person undergoing the process, etc.
Filed within seven days of public announcement. Includes details of IRP, CD, and the applicant; admission of application by AA; etc.
Merged into CP-1: A single form to be filled out after the constitution of the CoC.
Reason for Change
Relevant details are submitted in the assignment portal and other compliances.
To streamline initial reporting by reducing duplication and simplifying data submission.
Form CIRP-2 Filed within seven days of confirmation/ replacement. Includes details of the Authorised Representative selected by IRPs for a class of creditors, taking over management of the CD, receipt and verification of claims, the constitution of CoC, the first meeting of CoC, etc.
Form CIRP-3 Filed within seven days of issuing the Information Memorandum to CoC members. This includes details of RP and registered valuers, handing over CD records by IRP to RP, taking over CD management, etc.
Form CIRP-4 Filed within seven days of issuing the Request for Resolution Plan (RFRP). Includes expression of interest, RFRP & modifications, evaluation matrix and modifications, etc.
Form CIRP-5 Filed within seven days of the AA’s approval or rejection of the resolution plan or issuance of a liquidation order. Includes updated list of claimants, updated CoC, details of resolution applicants, details of resolution plans received, details of approval or rejection of resolution plans by CoC, etc.
Merged into CP-2: A single form to be filled out after the issue of RFRP.
Merged into CP-2: A single form to be filled out after the issue of RFRP.
To simplify mid-process reporting, ensuring all relevant information is captured in one streamlined form.
Merged into CP-2: A single form to be filled out after the issue of RFRP.
To simplify mid-process reporting, ensuring all relevant information is captured in one streamlined form.
Revamped into CP3A and CP-3B: - CP3A: Captures details of the application filed with AA for approval of resolution plan, liquidation, or closure (including by way of withdrawal, settlement, and others). - CP-3B: Captures details of the AA’s order approving the resolution plan or ordering liquidation or closure.
To simplify mid-process reporting, ensuring all relevant information is captured in one streamlined form.
To ensure clear and distinct reporting of application details and AA’s decisions, enhancing clarity and accuracy.
Form CIRP-6 Filed within seven days of significant events such as raising interim finance, commencement of insolvency resolution for CD guarantors, and extensions of the CIRP period.
Form CIRP-7 If any prescribed activity isn’t completed by the specified date, the IRP or RP must file Form CIRP 7 within three days and every 30 days after that.
Form CIRP-8 Resolution professionals must file Form CIRP 8 with details of their opinion and determination under regulation 35A by the 140th day from the insolvency commencement date.
Dropped
Relevant information is already captured in other forms, making this form unnecessary.
Revamped into CP-5: A simple form with minimal fields to be submitted by each month’s end. To ensure timely and efficient monthly updates with a focus on critical information.
Revamped into CP-4: Focuses only on the details of avoidance transactions reported to the AA.
To simplify reporting by capturing only essential details at the application stage.
