Constitution and Conduct of the CoC: 

 
Participation of RTP: 
 Avoidance transaction: especially around the twilight period (the period during which the
management of the entity is presumed to be aware of the possibility of commencement of
insolvency proceedings)- RTP has superior info 
 Sections 5(24) and 5(24A) of the Code defines a related party in relation to a CD and to an
individual, respectively. Who are RTP? 
 And section 21 and section 43 excluded the related party FCs (conflict of interest)- in line with
the UNCITRAL guide; Anti-avoidance rule specified under Section 43 of the IBC 
 it doesn't expound on the status of a financial creditor who ceases to exist as a related party and
whether such creditors can be part of the CoC. 
 Fortune Pharma Private Limited, the related parties of the CD, through multiple assignment
agreements, transferred their debts to a non-related third party with the aim to reduce the voting
share of S.B.I., the applicant, from 100% to 50%. 
 the Court had to deal with the issue of whether the relatedness of the parties could even have
existed in the past or whether they must continue in praesenti 
 Participation of inadequately authorized representatives in CoC: 
 are merely note-makers or listeners and don't have the authority to take part in adequate
deliberations in the meetings 
 In many other cases, the tribunal has criticized the CoC for conducting meetings without
attendance from their competent authorities to make final decisions. Most of these nominated
representatives fall back to their seniors for approval which delays the time-bound procedure
envisaged by the Code 
 SBJ Exports & Mfg. Pvt. Ltd. 
 The IBBI circular dated 10-08-2018 directed the resolution professionals to ensure the
attendees in CoC meetings are decision-makers themselves.  However, as the circular places onus
on the RP to ensure that authorized representatives attend the meetings, the CoC still has levy to
convolute 
 
ISSUES WITH WIDE DISCRETION OF CoC  
 reiterate the unfettered power to exercise commercial wisdom by CoC 
 scope of a section 30 is less 
 Hair-cuts: The haircuts on the claims have thus arisen from an average of 55% in previous
years to 60% in the financial year 2020-2021; evaluation matrix adopted by the CoC delineates
from the objectives of the Code; timeline gets affected 
 Bank of Barods- Restructuring Plan camouflaged as Resolution Plan emanating from an
ineligible person, which renders the role of the Committee of Creditors questionable 
 the absconding and section 29A ineligible promoters attempted to take over the company in the
guise of One Time Settlement, and 90.32% vote share of CoC approved it. 
 Varrsana Ispat Limited even when the company was a going concern and a scheme under
section 230 of the Companies Act, 2013 was under consideration, the liquidator distributed Rs.26
crore to FCs under their pressure. Such acts directly jeopardize the goal of corporate rescue 
 the Report of the Standing Committee 
 Discussion paper Code of Conduct 
 Few terms used in the Code of conduct such as:  
o "maintain integrity" (clause a),  
o "maintain objectivity while making decisions" (clause c),  
o "ensure that the decision making is free from any fear, bias, favour or coercion" (clause
j), etc.1 are vague and uncertain 
 
RECOMMENDATIONS  
  the inter-regulatory and coordination-based mechanism: prescriptive- the general regulations
by the Reserve Bank of India or the Securities and Exchange Board of India on the functions of the
CoC could be extended and adapted to the insolvency proceedings as well. As these regulations
wouldn't be considered as "law" for the purposes of Sections 30(2) and 61(3) of the Code;
Independent director- schedule 4- guidance- not mandatory.  
 it should be stipulated that only competent members who are authorized to take decisions are
nominated to the CoC; compliance in writing notice calling to the CoC meetings 
 Phoenix Arc- financial creditors that are related parties in praesenti would be debarred from
the CoC- but more detailed guidance on how to indetigy collusive and sham transactions 
 a maximum haircut limit for the resolution plan can be set. Regulation 35 of the CIRP
Regulations provides the determination of the fair value and liquidation value of the CD. The
maximum limit of haircuts can be according to these values decided under the said regulation. 
 
The issues with the institution of RP during CIRP process hindering the goal of corporate rescue
would be elaborated in three parts.   
lack of independence between Rp and CoC,  
lack of independence between RP and resolution application,  
overemphasis of the independence between RP and corporate debtor.  
 
For instance, in the Binani Cements Ltd v. Bank of Baroda and Anr. case the partiality of RP due to
the influence of CoC, lead to discarding of  a  better resolution plan submitted by Ultra Tech cements. The
Resolution Professional was reprimanded for acting as a puppet of the CoC without exercising their
own independent determination during the CIRP process. The resolution plan of Ultra Tech Cements
maximized the interests of all stakeholders as opposed to only creditors. The Insolvency Professional
Regulations, 2016 does not have any specific provision where RP and CoC cannot be related party. Though
the Code has a disclosure requirement under Regulation 8 of Schedule 1 of the Insolvency Professional
Regulations, 2016, there are two problems with it. First, the code is silent on the breach of it and a majority
creditor having 66% voting share can appoint an non-independent RP.  
 
 Resolution Professional and Resolution Applicant. The lack of independence between the two was
noted in the Ruchi Soya Industries Ltd where there was a conflict of interest between the resolution applicant
and the RP, as the same law firm represented one of the resolution applicants, Adani Wilmar and RP of Ruchi
Soya. In addition to lack of independence, there are no guidelines regarding the framing of eligibility criteria
for a resolution plan, which therefore leads to bias and impartiality on RP's part to favour specific bidders.
Such was observed in the case of MK Shah Exporters v. Assam Co India Ltd case.  
Therefore, the lack of standards, ethics and proper framework for the functioning of the RP will
hinder IBC’s goal of corporate rescue as it will discourage prospective resolution applicants, especially
foreign bidders, to submit a resolution plan.   
information asymmetry between corporate debtor and RP.  
The creditor-driven approach of insolvency law in India fails to take into consideration the
predominant concentrated ownership pattern in India. Promoters and management possess vital information
necessary for company’s revival is not passed to Resolution Professional. Further, s.29A makes promoters
ineligible to submit a resolution plan. Though, it cannot be denied that promoters or existing
management might be responsible for the company’s distressed position. However, Insolvency is not a
moral failure but an economic failure.150 Therefore, the Code using a one-size-fits-all approach regarding
the treatment of promoters can lead to hindrance in achieving the goal of corporate rescue. The Court
recognizing this allowed promotors to submit a resolution plan in the RBL Bank Limited v. MBL
Infrastructures Limited. However, such is not affirmed by the Supreme Court. 
 
 
 
Suggestions:  
 The suggestion is to implement provisions similar to UK Insolvency Practitioner Code of
Ethics for Insolvency Practitioner which has objectivity as one of its fundamental principles
 mandating the insolvency practitioner not to allow bias, conflict of interest or undue influence
of others to override professional or business judgements.  
 Further, conflicts of interest can be countered using information barriers such as confidentiality
and secure filings, and terminating relationships.  
 Also, penal provision similar to S.184 can be enacted where sanctions could be extended to
RPs found guilty of favouring specific resolution applicant  
 
 
 Multiple bidders for IBC process  
 What attempts have been made to have multiple bidders  
 
To conclude, with regards to the discrepancies at the moment, we are just focussing on the technical
aspects of the Code to achieve certain goals but not the qualitative aspects like the governance standards for
the two main actors of the CIRP process. Unlike the development of corporate governance, the Indian regime
should adopt a precautionary approach rather than a problem-solving approach in developing the “insolvency
governance” standards before the integrity of the Code crumbles. Would India set the benchmark for other
jurisdictions in developing insolvency governance?  

General:
Bhatia International (2002)
Part II is subject to part I

SMS tea- seperable from main contract

Non signatories:
Arbitrability- Booz allen- right in rem/personem-
Multi tier arbitration agreement- centrotrade
Kompetenz- Kompetenz- tule on its own jurisdiction

SPACs
The corporate affairs ministry has proposed to exempt special purpose acquisition vehicles (SPACs) from the
'shell company' provisions. In its 'Company Law Committee Report 2022',

the ministry proposed to give legal status to SPAC entities and exempt them from the requirement applicable
to companies regarding business operations.

SPACs are essentially blank cheque companies which don't have any intrinsic business of their own. They
raise money from investors and list on stock exchanges. After this, they look for acquisition opportunities
within 18 months. Usually, they buy an existing company and merge it into the SPAC. This benefits the
company being acquired since it helps them list on stock exchanges without having to float a public share
sale.

 SPACs allow start-ups to achieve their growth ambitions and potential through global listing opportunities
PIPE:
Private investment in public equity (PIPE) is the buying of shares of publicly traded stock at a price below
the current market value (CMV) per share. This buying method is a practice of investment firms, mutual
funds, and other large, accredited investors. A traditional PIPE is one in which common or preferred stock is
issued at a set price to the investor, while a structured PIPE issues common or preferred shares of convertible
debt.
The purpose of a PIPE is for the issuer of the stock to raise capital for the public company.

CUHL:
India’s Income Tax Department (“ITD”) attempted to change the settled interpretation of Section 9(1)(i) by
seeking to impose capital gains tax on an indirect transfer by a non-resident in the Hutchison–Vodafone
transaction. This attempt to “reinterpret” Section 9(1)(i) was rejected by the Supreme Court, in Vodafone
International Holdings BV v. Union of India & Anr. (Vodafone)1. 
Vednata acquired Cairn in 2011 and not it has been settled in dec 2021
Create favvourable conditions
Failed FET
Expropriation with no compensation
Government of India filed an appeal against the PCA decision on the ground that it is the sovereign right of
the Indian government to impose a tax
However, BIT awards cannot be treated as a foreign decree or judgment for the purposes of execution in India
under the CPC, since they are neither a ‘judgment’ as defined under the CPC, nor have they been delivered by
a ‘Court’ as also defined in the CPC. Thus, this is also not a viable option for a party seeking to enforce a BIT
award against India

EVALUATING THE THEORIES OF ABUSE IN GOOGLE’S SEARCH BIAS CASES

BG: With ex-ante regulations been contemplated for banning the anti-competitive practices1, it becomes
pertinent to evaluate what are the abuses that must be considered inherently anti-competitive.

critically analyze the decisions of European Commission, Competition Commission of India, and Federal
Trade Commission to evaluate the various theories of harm that can be attributed to the abuse and address
the question, can self-preferencing be a manifestation of competition on merits or does it always produce anti-
competitive effect?

India investigation: The investigation was triggered after Google’s policy modification to charge 30%
commission on the sale of digital goods and services by all app owners in Play Store 2. The substantial concern
of abuse didn’t stem from the introduction of 30% commission but was on Google’s mandate on app owners
to use only Google’s payment system, which is allegedly in violation of Section .

What is? self-preferencing by dominant undertaking through favoring their own affiliations in the

1
Vikas Kathuria, Ex-ante regulation for digital markets in India, ORF BLOG, (January 06, 2021),
<https://www.orfonline.org/expert-speak/ex-ante-regulation-digital-markets-india/>
2
Id.
adjacent markets has resulted in foreclosure of competition3.
 it should involve two markets, either vertically related, for example an application and its
operation system,
 horizontally related, for example two applications on the same operating system.
Relevant sections
Section 4 of the Competition Act, 2002
Article 102 Treaty on the Functioning of the European Union

India4,
EU5
United Kingdom6
United States7
Germany8

Three steps:
(i) identifying the relevant market;
(ii) determining if it’s a dominant undertaking and
(iii) whether the alleged conduct amounts to abuse of dominant position9.

Guilty only by CCI10 and EC11.

In the question of abuse, there were divergent practices.

The contours of the abuse of self-preferencing are not defined with precision and the decisions didn’t
univocally articulate the conditions for considering self-preferencing as anti-competitive. As self-preferencing
can be conceptualized both as a ‘normally accepted business practice’ or as a per se abuse12, it becomes
pertinent to formulate a tool to identify specific features that makes it anti-competitive in nature.

3
Beata Mäihäniemi, Lessons from the Recent Commission’s Decision on Google. To Favour Oneself or Not, That is the Question,
(NYU Working Paper).
4
Competition Commission of India, Matrimony.com Limited and Google LLC, Case Nos. 07 and 30 of 2012 (2018).
5
European Commission, Google Search (Shopping), Case AT.39740 (2017) [hereinafter as “Google Shopping Case”].
6
England and Wales High Court, EU Limited and Google Inc., Google Ireland Limited, Google UK Limited. EWHC 253 (Ch)
(2016)
7
Statement of the Federal Trade Commission Regarding Google’s Search Practices, In the Matter of Google Inc., FTC File Number
111-0163 (2013)
8
The Order of the District Court of Hamburg (Chamber of 8 for Commercial Matters), Verband against Google Inc. and Google
Germany, Ref: 408 HKO 36/13 (2013).
9
Section 4, Competition Act, 2002 (India); Section 2, Sherman Act (15 U.S. Code § 2); Article 102, the Treaty on the Functioning
of the European Union .
10
Competition Commission of India, Matrimony.com Limited and Google LLC, Case Nos. 07 and 30 of 2012 (2018).
11
Google Shopping Case.
12
Andrea Amelio et al., Recent Developments at DG Competition: 2017/2018, 1 Review of Industrial Organization, 10 (2018).
 The paper aims to critically analyze the decisions of EC, CCI, and FTC to formulate a theory of harm
that can be attributed to the abuse and address the question, can self-preferencing be a manifestation of
competition on merits or does it always produce anti-competitive effect?

European Commission’s decision

According to the EC, there was no onus to prove that the alleged abusive conduct had any anti-
competitive effects13. Nowhere in the decision the EC sets out to formulate a standard for permissible ranking
and selection criterions.

EU took a notable step by introducing European Commission’s Guidelines on ranking transparency

which aims to provide guidelines for online platforms to enhance transparency of their search results ranking
parameters14.

Competition Commission of India’s decision

In a first of its kind decision relating to the digital space in India, the CCI imposed penalty of Rs.135.86 crore
(5% penalty on Google’s average total revenue generated from its Indian operations in a time period of three
years).

In providing the second limb of reasoning, the CCI distinguished its decision from that of the EC by
not focussing merely on protection of competitors, but took into account the needs for protection of
consumers.

Federal Trade Commission’s decision

The U.S Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights Chairman
directed FTC to investigate whether Google’s search activities amounted to a violation of Section 5 of the
Federal Trade Commission Act.

four pages without in-depth reasoning.

Support for the decision can be found in it, that the FTC was of the notion that imposing penalty on
Google’s conduct would be detrimental to the interests of consumers and it could impede innovation in the
online search and advertising markets15. It is evident from its observation that the FTC adhered to the Chicago
13
Id.
14
European Commission, Guidelines on ranking transparency pursuant to Regulation (EU) 2019/1150 of the European Parliament
and of the Council (January 15, 2021), <https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX
%3A52009XC0224%2801%29#ntc9-C_2009045EN.01000701-E0009>
15
Geoffrey Manne et al., The FTC Did Not ‘Fumble the Future’ in Its Google Search Investigation, TRUTH ON THE MARKET
(March 26, 2021) <https://truthonthemarket.com/2021/03/26/the-ftc-did-not-fumble-the-future-in-its-google-search-investigation/>
principle16. This school of thought emulates that the main goal of anti-trust laws is the advancement and the
betterment of the consumers, irrespective of the anticompetitive actions by undertakings 17.

On one hand, following the EC’s decision, it was argued that digital platforms have a ‘duty’ to not
discriminate in favor of its own affiliate products 18. However, others argued that the commission’s decision
was strictly limited to the facts of that case and can’t be extended as a standard for evaluating all instances 19.
Some questioned whether self-preferencing as form of abuse could even be a sound and useful category of
anti-competitive conduct20. Often, the various theories and kinds of abuse overlaps with other well-established
categories which makes it subject to different legal tests21. Multiple different legal theories could be related to
the abuse of self-preferencing, such as exclusionary discrimination, the essential facilities doctrine, refusal to
deal. Then, can self-preferencing be classified as one particular category of theory of abuse?
At this point, it is important to point that the scope of the paper is not to advocate for a uniform theory
of law to be adopted by every anti-trust regime. The reason being there are inherent differences in the
mechanisms and structural features employed by each regime. For instance, in United States under the
Daubert rule, unreliable economic evidence can be excluded which is absent in EU22. Generally, the effects
threshold required to prove an infringement is different in the U.S. and the EU systems, as the latter usually
requires a lower bar23. Keeping this in mind, we would analyse few theories of abuse that could be used to
formulate a standard for identifying anti-competitive self-preferencing. It is also useful to note that many of
the theories would focus on the EU regime, as the U.S law hasn’t explicitly recognised self-preferencing as an
abuse and as the nascent Indian regime’s discussions on self-preferencing are not expansive.

Per se abuse v Effects test

The difference between the decision of FTC and the EC lies on the fact that whether we should
consider self-preferencing as prima facie unlawful without due consideration to the impact it creates or do we
prohibit it only when it has or like to has anticompetitive effects. Unlike the other decisions of the EC’s in the
context of Article 101 and 102 TFEU where it has analyzed if a practice could have pro-competitive or at
least an ambivalent impact on competition, in the allegations of self-preferencing it assumes a per se abuse 24.
16
Richard A. Posner, The Chicago School of Anti-trust Analysis, 127 University Of Pennsylvania Law Review, 925 (1979)
17
Id.
18
Vesterdof supra n. 57
19
Mäihäniemi supra n. 9
20
Ibáñez Colomo, Pablo, Self-Preferencing: Yet Another Epithet in Need of Limiting Principles SSRN (July 17, 2020) <
https://ssrn.com/abstract=3654083 or http://dx.doi.org/10.2139/ssrn.3654083>.
21
Lorenzo Gugliotta, The legality of self-preferencing under Article 102 TFEU: An answer from Google Search, TILBURG
UNIVERSITY (2019) < http://arno.uvt.nl/show.cgi?fid=147739>.
22
Maria Coppola & Renato Nazzini, The European and U.S. Approaches to Antitrust and Tech: Setting the Record Straight - A
Reply to Gregory J. Werden and Luke M. Froeb’s Antitrust and Tech: Europe and the United States Differ, and It Matters, CPI
EUROPEAN COLUMN, <https://www.ftc.gov/system/files/attachments/key-speeches-presentations/europe-column-may-2020-
full.pdf>.
23
Id.
24
AKZO Chemie BV v Commission, EU:C:1991:286 Case C-62/86; Hoffmann-La Roche & Co. AG v Commission Case 85/76; see
also Edward Iacobucci & Francesco Ducci, The Google Search Case in Europe: Tying and the Single Monopoly Profit Theorem in
Two-Sided Markets, 47 (16) European Journal of Law and Economics (2018).
However, the FTC was of the opinion that there were objective justifications to the conduct of Google. At this
point it is important to note that the purpose of an anti-trust regime is to preserve the competition process and
not to intervene in the market with an intention to neutralize and eliminate competitive advantage. Therefore,
a balance between both the approaches is necessary.

After the analysis of the various applicable theories to address this dichotomy, it won’t be wrong to
suggest that the mechanism to address self-preferencing lies along a continuum and can’t be dealt with by
adopting a sole theory of abuse. Some have also proposed normative changes to make the enforcement easier
which are notable to be considered25.

ASSESSING AD VOLEREM CHARGES:

Challenges posed frivolous and inflate claims- costs has been identified as an panacea for delay-whether an ad
Valorem charge of arbitrator fee could be useful to deter.

Current power: However, optional power- Section 31-A, Arbitration and Conciliation Act, 1996
The court/ arbitral body has the authority to decide: • which party must pay the cost • quantum of costs to be paid • by
when the costs are to be paid. • Explanation of Section 31-A defines costs as ‘reasonable costs’.

List of Ideal characteristics • Should it take up the exercise of making a distinction between frivolous and meritorious
claim? Or Should there be a nexus between the mechanism and frivolous/inflated claim • Shouldn’t be absolutely
discretionary • Should act as a deterrent AND should be a punishment • Shouldn’t be only against the losing party and
should identify the party raising frivolous claims • Shouldn’t violate essential features of ADR mechanisms

The amount of the fees is determined as a percentage of the dispute ICC; Stockholm Chamber of Commerce

`Schedule IV of the Arbitration Act, resembles the ad valorem method but the model provision is ‘not mandatory’

Dis-adv: Follows “cost follows event”. The winning party may not be penalized

Keeping these in mind: we suggest the Indian regime to adopt ad valorem which follows a reasonable rate and also
amend Section 31-A of the Arbitration Act, into a mandatory provision as opposed to it being discretionary in the hands
of the arbitrator(s).

25
Pedro Caro de Sousa, What Shall We Do About Self-Preferencing? SSRN (2020) <https://ssrn.com/abstract=3659065>