Union Budget 2022 Update Faster Resolution & Cross-border Insolvency

The Union Budget 2022 has paved the way for faster resolution of bankrupt companies by proposing amendments to enhance the resolution process's efficiency and cross-border insolvency resolution. The budget also proposes the speed up of voluntary winding up of companies. The budget has paved the way for faster resolution of bankrupt companies by proposing amendments to enhance the resolution process's efficiency and cross-border insolvency resolution. Finance Minister Nirmala Sitharaman proposes amendments in the Insolvency & Bankruptcy Code (IBC) structure to promote cross-border insolvency resolutions. This much-needed step will pave the way for the faster resolution of debt-ridden companies. The budget also proposes the speed up of voluntary winding up of companies. "Necessary amendments will be made in the IBC for more efficient dispute resolution and enable cross-border insolvency resolution," said Nirmala Sitharaman in her budget speech. Much talked, cross-border insolvency rules, once operational as law, will allow lenders to recover dues from defaulting borrowers disposing of foreign assets and promoters' personal assets parked in offshore locations. These rules about cross-border insolvency are expected to be framed on the United Nations Commission on International Trade Law (Uncitral) lines. According to the latest economic survey, the corporate debtors (CDs) rescued had assets valued at crore, while the CDs referred for liquidation had assets valued at Rs 0.52 lakh crore when they were admitted to Corporate Insolvency Resolution Process (CIRP).