The insolvency regulator has proposed mandating bidders for bankrupt firms to disclose beneficial ownerships, a move aimed at curbing misuse of the ‘clean slate’ principle and preventing backdoor entry of disqualified promoters or related parties. In a discussion paper, the Insolvency and Bankruptcy Board of India (IBBI) has suggested a standard format for beneficial ownership disclosures by all potential resolution applicants. Under the clean slate principle, enforced through Section 32A of the Insolvency and Bankruptcy Code (IBC), a stressed firm gets a fresh start after successful resolution. The provision grants immunity from prosecution for offences committed before insolvency proceedings, provided there is a bona fide change in management and control. “Effective implementation requires clear identification of persons who ultimately own or control the prospective resolution applicant,” the IBBI said in its paper.