This article discusses the Insolvency and Bankruptcy Board of India's (IBBI) recent proposal to introduce mediation as a preliminary step for operational creditors (OCs) before filing insolvency applications under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC).
‣ Mediation Step – Operational creditors can opt for mediation, led by a qualified mediator, to resolve disputes before formal proceedings
‣ Non-Settlement Report – If mediation fails, a report will accompany the creditor's application, aiding faster processing by the Adjudicating Authority (AA)
‣ Expected Benefits – The proposal is anticipated to improve efficiency, reduce costs, and expedite admissions by promoting early dispute resolution
