A brief change specifically since the advent of the covid 19 pandemic has introduced and highlighted the key use of ADR (Alternative Dispute Resolution) in insolvency disputes, focusing on efficiency, cost-effectiveness, confidentiality, preservation of business relationships, and cross-border applicability. ADR is preferred in insolvency disputes because it is generally cheaper, quicker, and more confidential than traditional litigation, allowing for greater autonomy and avoiding lengthy court battles.
The Insolvency and Bankruptcy Code (IBC) faced significant challenges during the COVID-19 pandemic, as businesses experienced disruptions in demand, supply, sales, and revenue. India's entry into the field of international dispute resolution may appear to offer cost-effective and convenient proceedings, but this is not always the case. The key advantage of using such services is the expertise of third-party professionals. A major challenge is deciding whether to use arbitration or the Corporate Insolvency Resolution Process (CIRP) under the Companies Act 2013. The extensive nature of the insolvency process can create conflicts in the commercial space.
