Vertical agreements (‘VAs’) or agreements between companies operating on different levels of the supply chain have increasingly become the subject matter of scrutiny before the Competition Commission of India (‘CCI’). VAs are an important part of how businesses function and CCI’s mandate is to scrutinize only those VAs that may adversely effect competition in Indian markets.

In the case of Messer Holdings Ltd. v. Shyam Madanmohan Ruia1, an appeal had been preferred before the Supreme Court (‘SC’) from a decision of the division bench of the High Court of Mumbai (‘Mumbai HC’), which had held that share transfer restrictions as set out in an agreement between shareholders are not violative of the Companies Act, 1956 (‘CA 1956’). The issue of enforceability of share transfer restrictions has long been vexed. It was expected, therefore, that SC would provide some clarity on this issue.

This is the first of a two-part series on the new Insolvency and Bankruptcy Code, 2016 of India, which was approved by the Indian parliament in May 2016 and received Presidential assent on 28 May 2016. This note deals with the debt restructuring process contemplated under the Code for corporate debtors with a view to re-establishing the debtor as a viable economic entity.

The Companies (Amendment) Bill, 2016 (‘Bill’) was introduced in the Lok Sabha on March 16, 2016, to amend the Companies Act, 2013 (‘Companies Act’), pursuant to the recommenda- tions of the Companies Law Committee in its report dated February 1, 2016. In order to give ef- fect to the proposed amendments, modifications will also be required to be made to the extant rules framed under the Companies Act.

With the stated aim of clarifying the foreign direct investment (‘FDI’) regime for e-commerce activities, the Department of Industrial Policy and Promotion (‘DIPP’) has issued Press Note No. 3 (2016 Series) on March 29, 2016 (‘Press Note’). Prior to the Press Note, the Consolidated Foreign Direct Investment Policy issued by DIPP (‘FDI Policy’) allowed 100% FDI under the au- tomatic route (i.e. without requiring prior approval of the Government of India) in business to business (B2B) e-commerce activities, but did not permit FDI in multi-brand retail trade activi- ty through online e-commerce.

Legislative Background of the Bankruptcy Code The Finance Minister, Mr. Arun Jaitley, in his Budget Speech 2015-16, had identified ‘Bankruptcy Law Reforms’ as a key priority for improving the ease of doing business and had announced that a comprehensive bankruptcy code, meeting global standards and providing necessary ju- dicial capacity, will be brought in. Consequently, the Government constituted a Bankruptcy Law Reforms Committee under the Chairmanship of Dr. T. K. Viswanathan to look into various bankruptcy related issues.

It has long proved difficult to deal with financially distressed companies in India. One of the main reasons is the many tools available to the existing management of a company to prevent an external creditor from taking control over the company. On June 8, the Reserve Bank of India (RBI) issued a circular introducing new measures that should provide help to lenders struggling to cope with the mountain of bad debt owed by Indian corporates.

The International MonetaryFund recently observed thatIndian corporate entities areamong the highest leveraged inthe Asia Pacific region. RecentReserve Bank of India (RBI)figures show that non-performingloans (NPLs) of the total loanportfolio of the Indian lendershave almost doubled from 2.2% inMarch 2009 to 4.5% in March2014. The rising incidence ofNPLs has been continuously onthe rise due to the economicslowdown after the globalmeltdown in 2008. AlthoughIndia outperformed expectationsriding through the globaleconomic slowdown relativelyunaffected, its exposure to thecrisis was unavoidable.

Sudipta Sen was on the run when police arrested him on April 23 at Hotel Snow Land, a resort with views of the Himalayas in Sonamarg, India, about 2,700 kilometers northwest of his Kolkata base. Sen’s Saradha Realty India Ltd., the anchor of an empire that took in small deposits and promised payouts of land, apartments or a refund of clients’ money with interest rates as high as 24 percent, was defaulting on thousands of deals. Employees of Sen’s media companies hadn’t gotten paychecks in months.

India's once-highflying airline industry is encountering serious financial turbulence. The rapid expansion of the commercial-aviation sector in India during the past decade has symbolized the nation's economic progress. But a dire combination of rising costs, sinking ticket fares and high levels of debt has left left carriers reeling and looking for government help. The most pressing crisis surrounds Kingfisher Airlines Ltd., which faces a cash crunch. The carrier, controlled by billionaire liquor tycoon Vijay Mallya, will release quarterly results Tuesday.