Alerts & Updates 9th Jul 2018

IBC | Legislative Alert | IPEs cannot act as IP and to render only support services to IPs

Latest Thought Leadership

Articles 6th Feb 2025

Union Budget 2025 Proposals for the Indian Crypto Industry: Alignment with Global Practices

Read More
Articles 6th Feb 2025

Debut of Track & Trace under Indian GST law fulfilling obligations towards public health

Read More
News & Media 6th Feb 2025

Will INR 12 lakh income qualify for zero tax even with capital gains?

Read More
News & Media 6th Feb 2025

ITR Filing: Know the new Budget 2025 rules for filing updated income tax returns

Read More

The Insolvency and Bankruptcy Board of India (“IBBI”) has clarified on the nature of services that can be provided by an insolvency professional entity (“IPE”) and insolvency professionals (“IP”), vide its circular dated 6 July 2018 (available here). As per the circular:

  • IPEs to provide services to only IPs
    • An IPE is recognised in accordance with regulation 12 (1) of the IBBI (Insolvency Professionals) Regulations, 2016, only if “its sole objective is to provide support services to the insolvency professionals, who are its partners or directors, as the case may be”.
    • Thus, an IPE cannot provide any service to any person.
    • It can provide only support services to the IPs who are its partners or directors. Thus, the role of IPE is clearly specified.
  • Only IPs can provided services of IPs and IPE cannot act as an IP
    • Section 206 of the Insolvency and Bankruptcy Code, 2016 (“Code”) prohibits a person from rendering services as an IP unless he is: (a) enrolled as a member of an Insolvency Professional Agency (IPA), and (b) registered with the IBBI.
    • Thus, no person other than a person registered as an IP with the IBBI can render services as an IP.
    • An IPE is neither enrolled as a member of an IPA nor registered as an IP with the IBBI. It cannot act as IP under the Code.

    In view of the aforementioned clarifications, given the role of an IPE, the IPEs are directed to refrain from seeking empanelment with or joining any panel of any market participant.

Privacy Policy

As per the rules of the Bar Council of India, lawyers and law firms are not permitted to solicit work or advertise. By clicking on the "I Agree" button, you acknowledge and confirm that you are seeking information relating to Economic Laws Practice (ELP) of your own accord and there has been no advertisement, personal communication, solicitation, invitation or any other inducement of any sort whatsoever by or on behalf of ELP or any of its members to solicit any work through this website.