Bills and Acts
Summary of latest bill and acts passed or pending in 2018 in Parliament of India with their salient features and issues for Current Affairs 2018 preparation for various examinations.
Category Wise PDF Compilations available at This Link
Parliament has passed Insolvency and Bankruptcy Code (Amendment) Bill, 2018 to bring relief to home buyers and Micro, Small and Medium Enterprises (MSMEs). The Bill replaces ordinance promulgated in this regard and amends Insolvency and Bankruptcy Code, 2016.
Key Features of Bill
The Bill recognises home buyers as financial creditors in the real estate project and giving them due representation in the Committee of Creditors (CoC), thus providing significant relief to home buyers. It will allow home buyers to invoke Section 7 of IBC, 2016 against errant developers.
This will allow financial creditors to file application seeking insolvency resolution process. As financial creditors, home buyers will be able to participate in decision-making process when developers are declared bankrupt under IBC, 2016. The bill also proposes to reduce minimum voting threshold for Committee of Creditors (CoC) to 66%, from 75% for key decisions.
Besides, the Bill also benefits Micro, Small and Medium Enterprises (MSME) sector from IBC. It allows promoter of MSME to bid for their own enterprise undergoing the insolvency resolution process as long as they are not wilful defaulters.
The IBC, 2016 provides time-bound process to resolution of insolvency among companies and individuals. Insolvency is situation where individual or company is unable to repay their outstanding debt. Government in November 2017 had set up Insolvency Law Committee to review IBC and identify issues in its implementation and suggest changes. The Committee had made several recommendations such as exempting MSMEs from certain provisions of IBC, treating allottees under real estate project as financial creditors, reducing voting thresholds of committee of creditors (CoC), among others. Subsequently, President had promulgated Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018 in June 2018 after approval of Central Government.
The Lok Sabha has passed Arbitration and Conciliation (Amendment) Bill, 2018 to help India become hub for domestic and global arbitration for settling commercial disputes. It seeks to amend e Arbitration and Conciliation Act, 1996 which contains provisions to deal with domestic and international arbitration and defines law for conducting conciliation proceedings.
Salient features of Bill
Arbitration Council of India (ACI): The Bill establishes ACI as an independent body for promotion of arbitration, mediation, conciliation and other alternative dispute redressal mechanisms. It will frame policies for grading arbitral institutions and accrediting arbitrators, make policies for establishment, operation and maintenance of uniform professional standards for all alternate dispute redressal matters and maintain depository of arbitral judgments (awards) made in India and abroad.
Composition of ACI: It will consist of Chairperson who is either Judge of Supreme Court or Judge of High Court or Chief Justice of High Court or eminent person with expert knowledge in conduct of arbitration. Its other members will include eminent arbitration practitioner, academician with experience in arbitration and government appointees.
Appointment of arbitrators: The Bill allows Supreme Court and High Courts to designate arbitral institutions, which parties can approach for appointment of arbitrators. For international commercial arbitration, appointments will be made by institution designated by Supreme Court. The institution designated by concerned High Court will make appointments for domestic arbitration appointments. In case there are no arbitral institutions available, then concerned High Court Chief Justice can maintain panel of arbitrators to perform functions of arbitral institutions. The application for appointment of arbitrator is required to be disposed of within 30 days.
Relaxation of time limits: The Bill proposed to remove time restriction for international commercial arbitrations. Earlier under the parent Act, arbitral tribunals were required to make their award within period of 12 months for all arbitration proceedings.
Completion of written submissions: The Bill requires written claim and defence to claim in arbitration proceeding should be completed within six months of appointment of arbitrators. Currently, there is no time limit to file written submissions before an arbitral tribunal.
Confidentiality of proceedings: The Bill provides that all details of arbitration proceedings will be kept confidential except for the details of the arbitral award in certain circumstances. Disclosure of the arbitral award will only be made where it is necessary for implementing or enforcing the award.