6 / 12
6
Regulatory Reforms Since
the 2014 Election
By Dezan Shira & Associates Delhi Office
Editor: Pritesh Samuel
The passage of a variety of reforms in recent years
reflects the government’s continued push to
transform the India’s business environment and
thereby improve access for foreign investors. Here,
we take a look at the key reforms and laws passed
and in development since Prime Minister Narendra
Modi’s government came into power in 2014.
Insolvency and Bankruptcy
Code, 2016
The Insolvency and Bankruptcy Code was
introduced in November 2015 and was passed
in parliament in May 2016. The Code repeals the
Presidency Towns Insolvency Act of 1909 and
the Provisional Insolvency Act of 1920, while also
amending other laws, including the Companies
Act of 2013, Recovery of Debts Due to Banks and
Financial Institution Act of 1993, and the Sick
Industrial Companies (Special Provisions) Repeal
Act of 2003. The Code assesses the viability of the
debtor and stipulates a plan for either its revival or
speedy liquidation.
Real Estate Act, 2016
The Real Estate (Regulation and Development)
Act amends the original Real Estate Bill, 2013 and
became law on May 1, 2016. All state governments
will be required to implement the Act’s rules and
regulations, and the full Act is to come into force
fromMay 1, 2017. The 2016 Real Estate Act aims to
protect the interests of purchasers by promoting
transparency, accountability, and efficiency in
construction and execution of real estate projects
by promoters. Among other provisions, it ensures
that promoters will be held accountable for
not registering with the Real Estate Regulatory
Authority or not providing enough information
on the project. In addition, brokers who help with
the sale and purchase of real estate will come
under the Act.
Commercial Courts,
Commercial Division and
Commercial Appellate Division
of High Courts Act, 2015
This Act aims to expedite the justice delivery system
addressing commercial disputes. It came into effect
on October 2015. The Act sets up a Commercial
Court at the district level and establishes a
commercial division in the High Court. The term
‘commercial dispute’ is also clearly defined to
include all disputes dealing with commercial
transactions regarding partnership agreements,
joint venture agreements, intellectual property
rights, shareholder agreements, insurance, etc.
Under the Act, disputes over matters worth
more than US$148,000 (Rs 10 million) will be
adjudicated by the Special Commercial Courts.
All international commercial arbitrations will also
be brought under theHighCourt.The Act lays down
strict timelines to ensure the prompt resolution of
disputes within 90 days, among other advantages.