New Insolvency or Bankruptcy law for individuals has recently received
quite a lot of attention from foreign expatriates living in UAE. The
Cabinet of UAE has lately sanctioned a federal law to explicitly govern
the cases of bankrupt individuals within the country. The law has been
issued to safeguard the business interest of UAE residents, enhancing
conditions of insolvent individuals and to ensure healthy competition
Corporate Lawyers of Dubai have been vigorously asked about the
nitty-gritty of the new law and how can individuals apply under the law
to protect themselves from going bankrupt.
It is important for the individuals that the Law will protect the
individuals for existing or anticipated financial crisis or disability
to settle outstanding debts. The legislation will assist individuals in
restricting their unpaid debts and will offer an opportunity to obtain
loans on compromised or effective rates.
The most significant feature of the laws favoring insolvent
individuals are as follows:
- decriminalization of financial obligations;
- avoiding legal prosecution;
- Offering jobs.
It has been further confirmed by the Cabinet of UAE that the law will
be effective from January 2020, although a concrete legislation has not
be issued to be referred to. Pertinently, financial experts will be
appointed by the court in order to review the financial position of the
insolvent individuals. The experts will be entitled to arrange payment
plans for a maximum of three (3) year allowing them to settle their
financial obligations in accordance with the plan.
It is of significant importance for readers to note that if the
insolvent has been given a payment plan, they will not be allowed to
seek further loans until the payment plan, unless approved by the
relevant court authorities. The law has the further ability to complete
legal procedures easily and to reduce court charges for individuals.
In a nutshell, the ideology behind issuance of this law is not only
prepare payment plans to enhance their credit ratio, but to ensure swift
growth in this dynamic market. The law, which supplements existing
finance related laws, will add to expanded straightforwardness as far as
common obligation reimbursement exchanges, and will at last fortify UAE
position as a perfect center point for businesses, where the privileges
of all parties are ensured.