RAS question
Which international model does the IBC Amendment Bill 2026 follow for cross-border insolvency?
Correct answer: (B) UNCITRAL Model Law.
The IBC Amendment Bill 2026 follows the UNCITRAL Model Law on Cross-Border Insolvency for cross-border insolvency resolution.
Explanation
The IBC Amendment Bill 2026 is aligned with the UNCITRAL Model Law on Cross-Border Insolvency. The Ministry of Corporate Affairs release says the Insolvency Law Committee recommended adopting the UNCITRAL Model Law because it gives a comprehensive framework for cross-border insolvency issues, with limited carve-outs to fit India's domestic insolvency framework. The policy direction is not a broad lender or macroeconomic framework, but a specific international insolvency model. The model's core ideas are access for foreign insolvency professionals and creditors, recognition of foreign proceedings and remedies, cooperation between domestic and foreign courts and insolvency practitioners, and coordination of concurrent proceedings in different countries.
Why the other options are wrong
- (A) The Insolvency Law Committee recommended the UNCITRAL Model Law as the basis, not a World Bank Model.
- (C) The IBC cross-border insolvency reform follows a UNCITRAL insolvency model, not an IMF Framework.
- (D) The Basel Accord concerns banking regulation and is not the model for the IBC cross-border insolvency framework; the relevant model is the UNCITRAL Model Law.
Concept
In the Indian Economy syllabus, insolvency reform intersects with global financial and legal standards. RAS asks about IBC changes because they are current-policy topics with direct links to investment confidence, creditor rights and institutional reform.