Key Points
The Insolvency and Bankruptcy Board of India (IBBI) is proposing a new voting system for bankruptcies allowing multiple votes for each available plan to maximise aggregate recovery and potentially reduce the dominant creditors influence in the balloting exercise...
Since the votes are assigned on the basis of preferences among the plans offered, chances of a liquidation the last resort in an insolvency will also likely be minimised...
If no plan secures the required 66% votes, the plan with the fewest first preference votes will be eliminated, and its first preference will be assigned to the second preference..
Through the preferential voting system, plans with the lowest first preference votes will be eliminated, and their votes will be transferred to the higher preference options indicated by the voters...
This proposed voting system for resolution plans is similar to the elections held in Rajya Sabha, Company Secretary, Chartered Accountant, and Cost Accounting elections...
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