Evolution of insolvency and bankruptcy code, 2016

Abstract

Ease of doing business is an index published by World Bank which indicates the conduciveness of an economy in supporting business in its frontiers. The index is calculated on the basis of the rules and regulations governing a wide array of factors from starting a business to closing down one. The ease of doing business index is meant to measure regulations directly affecting businesses and does not directly measure more general conditions such as a nation's proximity to large markets, quality of infrastructure, inflation, or crime. Although a conducive environment in terms of doing business does not guarantee improvements in economic indicators such as GDP per capita, it does free the economy from major constraints which might be limiting the economic performance. It also increases the confidence of various stakeholders for doing business. A nation's ranking on the index is based on the average of 10 subindices: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. All these parameters are of equal importance, and the notable factor for the purpose of this study is ‘resolving insolvency’. World Bank reports studies the time, cost and outcome of insolvency proceedings involving domestic entities as well as the strength of the legal framework applicable to judicial liquidation and reorganization proceedings. Questionnaires are used as the tool to get data about the indicators and the same is verified through a study of laws and public information on the systems.