President Promulgates Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018
President Shri Ram Nath Kovind has given his assent to the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018 (“IBC 2018”). The ordinance provides significant relief to homebuyers by recognising their status as financial creditors; increased representation in the Committee of Creditors that takes a call on resolution proposals; relief to micro small and medium enterprises by providing grant of special dispensation; strict procedure for withdrawal of a resolution application to protect the sanctity of the corporate insolvency resolution process; and relaxation of voting share from 75% to 66% for all major decisions to encourage resolution against liquidation.
RBI Eases MSME Loan Repayment Norms
The Reserve Bank of India (“RBI”) has via a circular dated June 06, 2018, provided a temporary relief to Micro Small and Medium Enterprises (“MSMEs”) which are not registered under Goods and Services Tax (“GST”) by extending the loan repayment deadline to 180 days from the due date without being classified as non-preforming asset. The RBI said in its policy, “Having regard to the input credit linkages and associated issues, it has now been decided to temporarily allow banks and NBFCs to classify their exposure, as per the 180 days past due criterion, to all MSMEs with aggregate credit facilities up to the above limit, including those not registered under GST.”