Saudi puts forward new bankruptcy draft law
Public invited to provide feedback with opinions, suggestions before the October 27 deadline
The Saudi Ministry of Commerce and Investment has published a new bankruptcy draft law and invited feedback those interested, with their opinions and suggestions before the deadline of October 27.
The Ministry of Commerce said that the bankruptcy law will enable stalled projects to be completed taking into consideration the financial constraints and to carry forward the business or to liquidate them if need be, while at the same time guaranteeing the rights of creditors and other stakeholders.
The Ministry stated that it had formulated the bankruptcy draft law in collaboration with global specialist companies after taking into consideration the needs of traders and investors in the Kingdom and analyzing the financial difficulties they faced.
It had also studied the best practices internationally and analyzed the laws of eight chosen countries, among them England, France, the United States and Germany.
These countries were selected based on several standards, including providing ways to deal with bankruptcy through different means according to each creditor’s case, either by liquidating his assets or adopting measures that enable him to pursue his business.
The draft law is constituted of 320 articles, including pre-emptive settlement measures, financial reorganization and liquidation and ensuring a separation between projects which are of economic benefit or not.