Claims could be made in Bahrain for money owed by foreign bankrupt companies, firms and establishments who have an office, property or asset in the kingdom.
Under amendments to the 195-article 2018 Bankruptcy Law, dues can be collected from the representative here rather than take the case to the country where the company, firm or establishment is based.
Other amendments include claiming money from inheritors or caretakers should the bankrupt businessman retire or die.
The amendments have now been referred to the Cabinet to be drafted into a formal legislation and resubmitted to the National Assembly for a vote.
Shura financial and economic affairs committee vice-chairman Khalid Al Maskati said the law was presented in 2018 as an urgent legislation by the government, which meant they had only 15 days to review the law.
“We wanted the law passed then with its flaws and its incomplete articles because it was important to have a legislation governing bankruptcy,” he said.
“Bankruptcy cases would be settled in a just manner that ensures the rights of those who are owed money whether from a foreign entity or even local businessmen who go bankrupt or retire.
“The current law doesn’t address these issues clearly as it leaves them open to interpretation with cases involving foreign companies being settled where they are based rather than in Bahrain through their representative.
“The same with a businessman who leaves inheritance or transfers money to his family members before declaring bankruptcy and retiring while he owns people money.”
He said the relationship between partners whether those involving all Bahraini, foreign or a mix was clear through the law after members pointed out that some foreigners fled the country in avoid paying their dues and it was difficult to locate them.
The law covers private individuals and businesses, but cases relating to financial institutions and insurance companies will be overseen by the Central Bank of Bahrain.
Those who deliberately hide money to claim bankruptcy, exaggerate debts, deliberately exclude creditors from bankruptcy documents presented to courts or provide false information will face up to two years in jail and a fine of up to BD100,000.
Others who reach secret deals with those seeking bankruptcy status, or provide false information about a debtor, will face the same punishment.
Meanwhile, a board chairman or executive whose negligence or dishonest behaviour results in bankruptcy will be fined up to BD100,000.
Meanwhile, a vote on a proposal to upgrade civil servants every year as an automatic annual promotion has been postponed indefinitely due to the circumstances the country is facing.
The amendment to the 2010 Civil Service Law would also guarantee civil servants automatic pay rise with the new grade.
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