Centre Suspends Initiation Of New Insolvency Proceedings For One Year To Promote Ease Of Doing Business Amid COVID-19

Union Finance Minister (FM) Nirmala Sitharaman on Sunday (17 May) said the central government has suspended any fresh insolvency proceedings to start against companies for one year to promote Ease of Doing Business in view of the of COVID-19 crisis.

“With an eye on further enhancement of Ease of Doing Business Government announces suspension of fresh initiation of insolvency proceedings up to one year,” news agency PIB tweeted quoting the Finance Minister.

The FM also announced that the COVID-19 related debt, mainly in the time period of the crisis, is going to be excluded from the definition of “default” under the Insolvency and Bankruptcy Code (IBC).

The Finance Minister today held her fifth press conference to announce the last tranche of economic stimulus package and reforms under the Atmanirbhar Bharat Abhiyan (Self-reliant India campaign).

She announced reforms and financial packages related to seven sectors, one of them being Ease of Doing Business.

FM Sitharaman also announced that more key reforms related to Ease of Doing Business are currently being discussed upon.

“Further key reforms for Ease of Doing Business are in the pipeline including direct listing of securities by Indian public companies in permissible foreign jurisdictions,” she said.