TaxTMI 
TaxTMI 
CODE OF CONDUCT FOR INSOLVENCY PROFESSIONALS
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....onal, resolution professional, liquidator, or bankruptcy trustee should not ^14[itself] acquire, directly or indirectly, any of the assets of the debtor, nor knowingly permit any relative to do so. Independence and impartiality. 5. An insolvency professional must maintain complete independence in ^12[its] professional relationships and should conduct the insolvency resolution, liquidation or bankruptcy process, as the case may be, independent of external influences. 6. In cases where the insolvency professional is dealing with assets of a debtor during liquidation or bankruptcy process, he must ensure that he or his relatives do not knowingly acquire any such assets, whether directly or indirectly unless it is shown that there was no impairment of objectivity, independence or impartiality in the liquidation or bankruptcy process and ^19[the prior approval of the Adjudicating Authority] has been obtained in the matter. 7. An insolvency professional shall not take up an assignment under the Code if he, any of his relatives, any of the partners or directors of the insolvency professional entity of which he is a partner or director, or the insolvency professional entit....
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....losure to be made within three days of (1) (2) Insolvency professional the appointment of the other professional. Corporate debtor the appointment of the other professional. Financial creditors constitution of committee of creditors. Interim finance providers the agreement with the interim finance provider or three days of the appointment of the other professional, whichever is later. Prospective resolution applicants the supply of information memorandum to the prospective resolution applicant or three days of the appointment of the other professional, whichever is later. If relationship with any of the above, comes to notice or arises subsequently of such notice or arising. Explanation: For the purposes of clause 8B and 8C above, 'relationship' shall mean any one or more of the following four kinds of relationships at any time or during the three years preceding the appointment of other professionals: Kind of Relationship Nature of relationship (1) (2) A Where the insolvency professional or the other professional, as the case may be, has derived 5% or more of his / its gro....
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....tion, liquidation or bankruptcy process, as the case may be, and must carefully plan ^12[its] actions, and promptly communicate with all stakeholders involved for the timely discharge of ^12[its] duties. 14. An insolvency professional must not act with mala fide or be negligent while performing ^12[its] functions and duties under the Code. Information management. 15. An insolvency professional must make efforts to ensure that all communication to the stakeholders, whether in the form of notices, reports, updates, directions, or clarifications, is made well in advance and in a manner which is simple, clear, and easily understood by the recipients. ^8[15A. An insolvency professional shall prominently state in all ^12[its] communications to a stakeholder, ^12[its] name, address, e-mail, registration number and validity of authorisation for assignment, if any, issued by the insolvency professional agency of which he is a member.] 16. An insolvency professional must ensure that he maintains written contemporaneous records for any decision taken, the reasons for taking the decision, and the information and evidence in support of such decision. This shall be maintained so a....
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....yment secured through open competitive recruitment, with, or render professional services, other than services under the Code, to a creditor having more than ten percent voting power, the successful resolution applicant, the corporate debtor or any of their related parties, until a period of one year has elapsed from the date of his cessation from such process. 23B. An insolvency professional shall not engage or appoint any of his relatives or related parties, for or in connection with any work relating to any of his assignment. ^16[Explanation.- For the purposes of this clause, the insolvency professional which is an insolvency professional entity may engage or appoint its partners or directors, as the case may be, for or in connection with any work relating to any of its assignment other than work related to valuation and audit of the debtor.] 23C. An insolvency professional shall not provide any service for or in connection with the assignment which is being undertaken by any of his relatives or related parties. ^17[Explanation 1].- For the purpose of clauses 23A to 23C, "related party" shall have the same meaning as assigned to it in clause (24A) of section 5, but d....
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.... take all necessary steps to ensure that the corporate person complies with the applicable laws. 27B. An insolvency professional shall not include any amount towards any loss, including penalty, if any, in the insolvency resolution process cost or liquidation cost, incurred on account of non-compliance of any provision of the laws applicable on the corporate person while conducting the insolvency resolution process, fast track insolvency resolution process, liquidation process or voluntary liquidation process, under the Code.] Gifts and hospitality. 28. An insolvency professional, or his relative must not accept gifts or hospitality which undermines or affects his independence as an insolvency professional. 29. An insolvency professional shall not offer gifts or hospitality or a financial or any other advantage to a public servant or any other person, intending to obtain or retain work for himself, or to obtain or retain an advantage in the conduct of profession for himself. **************** NOTES:- 1. Substituted vide Notification IBBI/2017-18/GN/REG027 - Dated 27-03-2018, before it was read as, "[Under Regulation 7(2)(g)]" 2. Inse....