The Federal Bankruptcy Law issued under the federal decree No. (9) for 2016 on various bankruptcy cases. The law identifies different ways to avoid bankruptcy cases and the liquidation of debtors’ assets, including consensual out-of-court financial restructuring, composition procedures, financial restructuring and the potential to secure new loans under terms set by the law.
The law stipulates the role of the “Committee of Financial Restructuring”. The UAE Cabinet will decide on the number of members and entities that will represent the committee, and will administer the committee’s law and its procedures. The Committee is responsible for: overseeing the procedures of any consensual out-of-court financial restructuring, preparing an approved list of bankruptcy experts, appointing Trustees in Financial Restructuring procedures, who will also be available for all court proceedings. The Committee is also responsible for establishing as well as maintaining a national electronic database of individuals who have had bankruptcy rulings against them, including restrictions set by the court or loss of eligibility.
The law is implemented on: companies that were established under commercial company laws, companies that were not established under the commercial company law, semi or fully owned companies by the federal or the local government with legislatives for establishment that fall under this law, companies and institutions established in free zones and which do not have provisions to regulate composition procedures or restructuring bankruptcy according to the Federal law No. (8) of 2004 concerning financial free zones, any trader or civil licensed company.
View the text of the law