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CS Executive · Setting Up of Business, Industrial and Labour Laws · Startups and its Registration

Neha's startup wants quick closure of its business if it fails. Which Action Plan measure is aimed at this problem?

The Action Plan provides an easier exit for failing startups through a fast-track insolvency and winding-up process under the Insolvency and Bankruptcy Code. It does not ban closures, force government acquisition or shift liabilities to relatives.

  1. AEasier exit under the Insolvency and Bankruptcy Code, with a fast-track process for winding up startupsCorrect
  2. BA ban on closing any company within ten years
  3. CCompulsory sale of the startup to the government
  4. DAutomatic transfer of liabilities to the founders' relatives

Explanation

The Action Plan promised an easier exit route for startups through a faster insolvency process under the Code. The other options describe measures that do not exist. The ten-year ban is wrong as it would harm, not help, exit.

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