The insolvency law committee (ILC) that recently came out with recommendations on cross border insolvency essentially based on the UNCITRAL Model Law has proposed a presumption of default trigger to start insolvency proceedings in India. This, if the insolvency proceedings in the corporate debtors COMI (centre of main interest) has been recognised in India.
Under the IBC currently, creditors can initiate proceedings on a default of 1 lakhunlike some other jurisdictions which have to establish state of insolvency of debtor first.
Foreign main proceedings
Proceedings in the COMI is recognised as the foreign main proceeding (FMP). Recognition essentially implies automatic moratorium such as transferring of assets by the corporate debtor. I…
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