Why in news?
The Rajya Sabha has passed two Bills — the Insolvency and Bankruptcy Code (Amendment) Bill, 2020 and the Mineral Laws (Amendment) Bill, 2020.
Insolvency and Bankruptcy Code (Amendment) Bill, 2020
- The bill seeks to remove bottlenecks and streamline the corporate insolvency resolution process. It aims to provide protection to new owners of a loan defaulter company against prosecution for misdeeds of previous owners. The latest changes pertain to various sections of the IBC as well as introduction of a new section.
- The IBC, which came into force in 2016, has already been amended thrice.
- Stressing that the government is “very responsive” and has been talking to the industry, she assured the House that amendments to the IBC are not being “unthinkingly done”.
- The Bill replaces an ordinance.
- The amendments were earlier introduced as ordinances. Now after the Parliament session begun the ordinance was introduced as bill. And the bill has now been passed as an act in the parliament. The amendment aims to protect the successful bidders of insolvent companies from risk of criminal proceedings. The criminal proceedings may be expected from previous promoters of the company.
- The Ordinances are laws promulgated the President of India. The President issues ordinance on recommendation of Council of Ministers. An ordinance shall be issued only when the Parliament is not in session.
Mineral Laws (Amendment) Bill, 2020
- The Minerals Laws (Amendment) Bill, 2020 will ensure a new era for promoting the Indian coal and mining sector, especially the ease of doing business. Experts believe that coal production will increase and dependence on imports will be reduced when this action will come into the force.
- The amended bill has clear provisions for companies to participate in the auction of coal and lignite blocks even if they don’t have prior experience of coal mining in India. This will not only increase participation in coal and lignite block auctions but will also facilitate the implementation of FDI policy in the coal sector.
- Now, companies that are not involved in any specific type of end-use can participate in the auction of Schedule II and III coal mines. The removal of the last usage barrier will allow for wider participation in the auction of coal mines specified by the Central Government for various purposes such as its consumption, sale or any other purpose.