Amendments to the 2018 Bankruptcy Law were yesterday unanimously approved by the Shura Council.
The Royal Decree was issued by His Majesty King Hamad during the National Assembly’s recess last year and aims to reconcile the financial and economic conditions for investments and companies.
It was extensively reviewed by Shura’s financial and economic affairs committee which revealed that the amendments aim to strengthen creditors’ rights.
“This is one of the important laws because bankruptcy has national and international impact across social and economical levels,” said Shura Council’s second vice-chairwoman Jameela Salman.
"We all remember the crisis in America in 2008 when banks went bankrupt and it impacted the economy of America and the entire world.
“All countries are now required to adjust and improve their bankruptcy laws following international recommendations. The 2018 Bankruptcy Law approved in Bahrain has carefully taken into account all modern measures required.”
She also revealed that amendments include extending the appeal period from 20 days to 30 days while also ensuring all parties are involved in the process equally.
She said prior to the amendments in 2018, creditors suffered since bankruptcy cases could take up to 10 years for reconciliation in court.Shura Council members unanimously approved the law and reaffirmed it through a vote called out by each individual name.
“Since this law was issued there has been a massive change in the restructuring process during bankruptcy. It also ensures fair and just reconciliation efforts and decisions followed by the review of the bankruptcy trustee,” said legislative and legal affairs committee chairwoman Dalal Al Zayed.
“This reinforces trust in the financial and economic systems in Bahrain while also enhancing Bahrain’s credit rating in the World Bank which reviews the status of various countries.”
Meanwhile, Shura Council first vice-chairman Jamal Fakhro urged officials from the Justice, Islamic Affairs and Endowments Ministry to involve all parties in the wording of the decree.
“It is also critical to ensure that people dealing with this law and implementing it receive training – such as banks, bankruptcy trustees and others – so that it is implemented effectively and fairly,” he said.
“Private companies suffer greatly due to the slow bankruptcy process implemented in courts, as it can take years in some cases,” said Shura Council member Mona Almoayyed.
“Many rights are lost during this time and this law – which is timely – will solve the issue of the slow process in courts.“It will aid in improving Bahrain’s status as a financial and economic hub.”
Meanwhile, Shura members also voted in favour of proposed amendments to the 1976 Penal Code which would soften penalties for those who forge official stamps – provided they turn themselves in.
They also rejected controversial new election rules – including amendments to the 2002 Political Rights Law, 2002 Shura Council and Parliament Affairs Law and the 2002 Municipal Councils’ Elections Law.reem@gdn.com.bh
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