Sheikh Mohammed bin Rashid Al Maktoum, Vice President, and Prime Minister of the UAE and Ruler of Dubai, has enacted a new DIFC Insolvency Law, Law No. 01 of 2019, the Dubai International Financial Centre (DIFC) said.
The newly-enacted law compliments the DIFC’s commitment to international best practice, with the Insolvency Law aiming to balance the needs of all stakeholders in the context of distressed and bankruptcy related situations in DIFC, facilitating a more efficient and effective bankruptcy restructuring regime, reported Emirates news agency Wam.
Essa Kazim, Governor of DIFC, said: "Ensuring that businesses and investors can operate across the region with confidence is crucial to our role in connecting the economies of East and West.
“We are committed to continuously enhancing our legislative infrastructure in order to give leading global institutions the certainty and access they need to capture the opportunities within the MEASA region, through Dubai."
The new Insolvency Law and Regulations, which will come into effect on August 28, 2019, introduces a new debtor in possession bankruptcy regime in line with best practice globally which will also place the DIFC at the forefront of complicated debt restructurings.
The law also provides for a new administration process where there is evidence of mismanagement or misconduct. The law also enhances the rules governing winding up procedures; and incorporates the Uncitral Model Law on cross border insolvency proceedings with certain modifications for application in the Centre.
The new law was subject to substantial research and global benchmarking, as well as thorough public consultation, which helped shape the law to ensure that the DIFC remains the most sophisticated and business-friendly Common Law jurisdiction in the region.