India could exclude some key strategic sectors, such as aviation, telecommunications and critical infrastructure services, from the cross-border insolvency framework’s ambit.
The Ministry of Corporate Affairs (MCA) released a consultation paper on November 24 seeking public comments on a draft cross-border insolvency framework under the Insolvency and Bankruptcy Code (IBC) by December 15.
The government intends to amend the IBC in the Winter session of the Parliament that begins on Monday.
“Certain sectors are of national importance, highly sensitive and bound by various regulations and conditions, so their insolvency significantly affects public interest,” said a senior government official.
Once the Bill is introduced, the government is likely to put out a negative list of sectors, the official added.
While financial services providers have been kept out of the ambit of cross-border insolvency provisions, the government is looking to exclude some more sectors when the final rules are issued after the amendment, the official said.
The proposed amendment would empower the government to notify a class or classes of corporate debtors or entities to whom the provisions of cross-border insolvency provisions would not apply.
29/11/21 Shrimi Choudhury/Economic Times
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