In landmark move, UAE sets up Bankruptcy Court to rule on disputes
New law to take effect next May and is in line with best global practices
Dubai: The UAE is overhauling its bankruptcy and restructuring law, introducing a dedicated court to oversee related disputes.
The legislation – formally Federal Law Decree No 51 of 2023 – comes into force on May 1, 2024, and replaces the 2016 bankruptcy framework. (This was first reported by the online publication AGBI.)
The UAE has been extensively recasting its bankruptcy rules in recent years, and the launch of a specialised court will be a natural progression. It will help with setting judgements that will act as precedents, according to legal sources. The law is to introduce an extended moratorium period.
The bankruptcy court will have the 'authority' to halt creditor actions from the start of proceedings until the approval of the restructuring plan, with no set time limit.