Ease of Exit of Businesses in India

‘Doing business’ is not only about seamless starts or how less cumbersome the journey can be – it is also about the certainty of freedom to exit, as and when needed. As such, a sound framework for exit is quintessential for businesses – viable or non-viable. A company might opt to liquidate itself voluntarily, or go for a scheme of merger or amalgamation or even striking off. At the same time, it must be noted that exit may not be always voluntary – sometimes, it may be forced upon the business, for example, in case of insolvent companies, creditors may prefer to liquidate the entity rather than drag it as a going concern. Some of the important considerations in making a choice are – solvency of the company, position of assets and liabilities, extent of judicial involvement, extent of flexibility in the conduct of the process, professional involvement, time involved, and costs. With the judicial authorities being clogged with cases, we may need to reinvent the infrastructural framework and take steps to make the exit process easier. The article discusses the aspects as above.

  1. This Article has been published in the April, 2020 issue of Chartered Secretary, issued by the Institute of Companies Secretaries of India, available at- https://www.icsi.edu/media/webmodules/linksofweeks/ICSI-April_2020.pdf

Cross Border Mergers

As the global economy becomes more and more intertwined, the trend of cross border mergers and amalgamations have accelerated..

In the presentation below, we discuss the concept of Cross border mergers in light of the extant provisions, and its practical aspects- Click here

An audio presentation of the same is also available at- https://youtu.be/jHVIajr2q00

Recent Reforms in Insolvency and Bankruptcy Code

-Sikha Bansal & Megha Mittal

(resolution@vinodkothari.com

The past year has seen several reforms and amendments in the insolvency framework, be it enforcement of provisions for individual insolvency, or inclusion of FSPs under the insolvency regime. Additionally, Committees have been actively working on two extremely relevant aspects which presently the Code does not provide for- Group Insolvency and Cross Border Insolvency.

In our presentation (link given below) we have tried to collate the recent amendments and the workings of the Committee reports so as to provide a one-stop reference for  reforms as on Mar’20- see here