Compliance with IBBI (Insolvency Professionals) (Amendment) Regulations, 2018

The Insolvency and Bankruptcy Board of India (IBBI) vide circular dated April 5, 2018 has advised Insolvency Professional Entities (IPEs) to ensure the compliances of provisions of regulation 12(1) of Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016.
In reference to IBBI (Insolvency Professionals) (Amendment) Regulations, 2018, IPEs recognized on April 1, 2018 need to comply with the following criteria on or before June 30, 2018:
• majority of its partners or directors, as the case may be, are insolvency professionals;
• majority of its whole time directors are insolvency professionals, in case it is a company; and
• none of its partners or directors is a partner or a director of another IPE.
Further, they are also required to comply with the following criteria on or before September 30, 2018
• its sole objective is to provide support services to insolvency professionals, who are its partners or directors, as the case may be;
• it has a net worth of not less than one crore rupees;
• majority of its shares is held by insolvency professionals, who are its directors, in case it is a company; and
• majority of capital contribution is made by insolvency professionals, who are its partners, in case it is a limited liability partnership firm or a registered partnership firm.
Also, IPEs are required to ensure that they satisfy the requirements prescribed in regulation 12 as mentioned above at all times.