E-auction of sick business assets on dedicated platform may become compulsory

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Subscribe to enjoy similar stories. New Delhi: Auction of assets like land, buildings, plant and machinery belonging to businesses getting liquidated is likely to see a wider public participation, with the Insolvency and Bankruptcy Board of India (IBBI) planning to make these transactions more mainstream.

After asking liquidators on 29 October to list all such assets of companies facing liquidation on the eBkray (now renamed as baanknet.com) platform set up by an alliance of state-run banks, IBBI is now considering making it compulsory to conduct auctions through this portal, two persons informed about the development said. “At present, the portal allows a viewer to express her interest on an asset being offered under the IBC (Insolvency and Bankruptcy Code) auction module and the person will be contacted by those responsible for the auction.

E-auction through this portal for companies going for liquidation under IBC may be mandated in the future," said the first of the two persons cited earlier, both of whom spoke on the condition of anonymity. When IBBI, a regulator that supervises corporate insolvency proceedings, introduced compulsory listing of liquidation assets under the IBC on the portal from 1 November, it said liquidation professionals ‘may’ use it for the sale of assets in all ongoing cases, indicating its preference for auctions on this platform.

The regulator sees a clear advantage in having a centralised portal where all IBC assets going for liquidation are available to the public, which may enhance the recovery value and improve transparency, said the person. The IBC was implemented in 2016 to resolve and expedite the reallocation of stressed assets.