Union Cabinet Approves Ordinance to Amend IBC
The Union Cabinet approved changes to the Insolvency and Bankruptcy Code (“IBC”) through an ordinance to put homebuyers on par with financial creditors when deciding the fate of real estate firms that have defaulted on loan payments. Earlier, homebuyers were treated as unsecured creditors who came after secured and institutional creditors in terms of priority for recovery of dues. This amendment has been made on basis of the recommendations suggested in the report of the 14-member Insolvency Law Committee. The report suggested that homebuyers should be treated as financial creditors, which will allow them to equitably participate in an insolvency resolution process.
SEBI Allows Clearing Corporations to Invest in Foreign Sovereign Securities
The Securities and Exchange Board of India (“SEBI”) in its circular dated May 21, 2018, has allowed clearing corporations at international financial service centres to invest in in foreign sovereign securities (“FSS”) with the highest credit quality. Foreign currency is a form of FSS. However, SEBI has mandated that the investment in such securities should not exceed a limit of 10 per cent of the total investible resources, excluding funds lying in core settlement guarantee funds of the investor clearing corporation.
Microsoft Privacy Policy Under Scrutiny in Supreme Court
A petition was filed in the Supreme Court questioning the privacy policy of Microsoft Corporation alleging that it indulges it an unauthorized collection of data of users without their knowledge and permission. The petition further alleged that the remote storage of data in foreign locations is a direct violation of the fundamental right to privacy. The petitioner also highlighted the threat to national security as most governmental agencies are using software programs of Microsoft. The petitioner contended that the “right to privacy was available against non-state actors, and in view of the growing power of social media and software giants, the ambit of the right should be expanded to shield the citizen from their intrusive acts”.