The Ministry of Finance has been tasked with looking at the best way to introduce the bankruptcy law in UAE, according to state news agency Wam.
Ministry studies ways to implement UAE bankruptcy law
The Ministry of Finance is to look at the best ways to implement the long-awaited bankruptcy law, a senior government official said yesterday.
Younis Al Khouri, under secretary of the ministry, told Abu Dhabi TV that a draft law had been prepared two years ago.
Mr Al Khouri said the Ministerial Council for Services recently authorised the ministry to study its implementation, the state news agency Wam reported.
Business leaders and lawyers have been calling for such a law for several years.
It is expected that it will overhaul procedures concerning businesses with debt that they cannot pay, detailing how it can be restructured.
Mr Al Khouri said the draft included more than 430 articles.
It would differ from the commercial transactions act issued in 1993, with one important difference being a possible shift from criminal proceedings to civil proceedings when dealing with debtors.
The new law will not apply to government entities.
Its implementation has been described as a major step to attract more foreign investment and boost entrepreneurship in the UAE.
A survey published by the World Bank in October last year puts the UAE in 101st place globally when it comes to the ease of recovering debt in insolvency.
The UAE's recovery rate was 29.4 cents on the dollar, the survey said.