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IBC amendment seeks to provide prepack resolutions for MSMEs

NEW DELHI: The government has amended the Insolvency & Bankruptcy Code to provide for prepackaged resolution framework for micro, small and medium enterprises (MSMEs) through promulgation of an ordinance.

The alternative insolvency resolution framework is expected to bring about a quicker and more cost-effective process for MSMEs that would maximise value while being least disruptive to business, according to the ordinance, issued late Sunday.

Prepackaged insolvency resolution is seen advantageous as a resolution plan can be settled upon outside of court, leading to fewer business disruption costs, lower legal and procedural costs and less time in court.

Read More on The Economic Times