The Ministry of Finance confirmed that the new insolvency law, No. (19) of 2019, came to preserve the rights of the creditor and the debtor, and ensure the stability of financial transactions in the state, explaining that all kinds of debt - including bank loans and various financing - do not fall by declaring insolvency of individuals, but remain those that The debtor has not been reimbursed for up to 15 years, and each creditor shall execute the funds available to the insolvent in the future.
In detail, the adviser to the Minister of Finance, Dr. Hossam Talhouni, told «Emirates Today», «the law came to preserve the rights and not to evade them, and can not be used as a way to evade the individual from repayment with the rights of creditors, so the debtor can not take advantage of insolvency declaration to drop His debts.
Talhouni added that «insolvency declaration procedures include a plan to settle the debts of the insolvent person by liquidating its funds and distributing them to creditors, according to the priority of each of them, but if these funds are not enough to pay the rights, the settlement procedures are closed and the insolvency of the debtor is closed».
He continued: «(insolvent) notorious insolvency, which has not paid the full amount of creditors, are suspended some rights, such as borrowing from banks or financial institutions, or engage in some financial transactions with others, for a period of three years from the date of closure of insolvency proceedings» .
Talhouni pointed out that «within a period of three years, and until the passage of 15 years, creditors can seize any funds entered immediately by the judge of execution without the need to engage in long civil litigation proceedings, but these procedures are under the umbrella of the civil law and not insolvency law».
He stressed that the insolvent may not be imprisoned during the application of settlement procedures, but if the insolvency is declared, and within the next three years or more, the imprisonment proceedings can be carried out in accordance with other laws and not the insolvency law.
He added that «the law was designed to contribute to the strengthening of financial and economic stability in the state, and provides a safe environment for the provision of personal loans easily and conveniently, to the satisfaction of both the creditor and the debtor, as the law provides the necessary balance to ensure the rights of all creditors and debtors, and encourages increased cash flows, To support the comprehensive and sustainable development efforts in the country ».
He pointed out that the issuance of the executive regulation would clarify all the points and matters mentioned in the text of the law in a simplified and understandable manner, pointing out that there will be cooperation and guidance to the judicial departments to accelerate the insolvency proceedings in the interest of the creditor and the debtor.
Insolvency declaration
The judgment declaring the insolvency of the debtor and liquidating its property shall result in:
* Preventing the debtor from obtaining a new loan or financing for a period of three years from the date of the judgment declaring his insolvency.
* Preventing the debtor from entering into obligations, with or without compensation, except for what is necessary to satisfy his essential needs or his dependents for a period of three years, starting from the date of issuance of the insolvency of the debtor and the liquidation of his assets, unless the court authorizes him to do so by order of a request submitted by the debtor.
* Listing the names of debtors issued against them in the month of insolvency and liquidation of their funds in the special register. The form of the register, the data to be included, the competent authority to organize it, and other relevant terms and conditions shall be determined by a decision of the Council of Ministers.