The Council of Ministers adopted a federal law to regulate insolvency of the natural person, and is designed to enhance the competitiveness of the State in the field of ease of doing business, to facilitate individuals facing financial difficulties, and to protect those who are unable to pay their debts from bankruptcy.

The new law is part of the government's efforts to make it easier for citizens and residents to find out about their needs. The law deals with individuals who face current or anticipated financial difficulties that make them unable to settle all their debts, or what is known as insolvency of the natural person. The law shall apply to a natural person who does not engage in economic activity and is not considered a merchant. The law protects the debtor from any legal prosecution, denies criminal status for the financial obligations of the insolvent person, and gives them an opportunity. To work, productivity and support his family. The law will enter into force from January 2020, assisting the debtor in settling its financial obligations, through one or more experts appointed by the court to settle obligations, and prepare a plan in coordination between the debtor and creditors, not more than three years, to settle financial obligations and fulfill all Obligations stipulated in the plan, provided that the debtor is prevented during that period from any debts, the court shall subsequently issue, at the request of the expert or the debtor, or any of the creditors, a decision to complete the implementation of the plan. The law also contains special provisions that contribute to the speed of deciding the procedures, and reduce the burdens required to reorganize and restructure the debts, in order to reach a balanced solution in the interest of creditors and debtors at the same time.

The law contributes to enhancing the long-term creditworthiness of the state and prospects for its future growth, as well as enhancing the competitiveness of the state and the strength of its economy, leading to a stable economy that provides individuals with a favorable and encouraging environment for doing business.

Federal law to regulate insolvency of a natural person

■ It aims to facilitate individuals facing financial difficulties and enhance the competitiveness of the state.

■ For individuals who are unable to pay their debts as a result of financial hardship.

■ Protects individuals from bankruptcy and prosecution, giving them a chance to work, productivity and support their families.

■ Assists in the settlement of financial obligations, through a plan of not more than three years, in collaboration with an expert.

Strengthen financial stability

The Federal Law to Regulate Insolvency of Natural Persons comes as a complement to the system of integrated financial laws in the State, which supports greater transparency about the transactions of repayment of civil debts, thereby enhancing the financial stability in the State, and supporting its position as an ideal investment environment that guarantees the protection of the rights of all parties.