DIFC Insolvency Law in UAE Amidst Covid 19

1. DIFC Insolvency Law in UAE Amidst Covid 19 Author: Dr. Hassan Elahais We all have been witnessing major steps taken by the government of UAE in order to prevent negative impact of coronavirus on our economy. COVID-19 has just made wide-scale interruption to various ventures both locally and internationally. While endeavors are in progress to stop the spread and effect of COVID-19, the money related and social impact of the infection will be felt for a long time to come. As organizations are currently managing work from home and the new scenarios in which they can work, some business definitely will understanding monetary challenges (be it present moment or longer term). The major role in the current situation is certainly played by the government by releasing certain strategies and plans to assist organizations to survive in such circumstances and to financially support them to maintain the economy. Having said that, apart from the government there are other non-governmental authorities (empowered by the government) taking charge in the current situation to sustain the economy like Dubai International Financial Free Zone (DIFC), wherein multiple companies are registered and are facing financial struggles due to COVID-19. It is advised to all shareholders or directors of the companies registered within UAE or in DIFC or any other free zone to seek legal assistance from Top Lawyers in Dubai in case they face financial hardships or to understand various alternatives offered by the government or non-government authorities to assist you in your financial problems. The present article strictly focuses implementation of the new Insolvency Law of DIFC and its usage in the current scenario for companies registered in DIFC. The recently instituted insolvency law supplements the DIFC responsibility to global best practice and expects to balance all companies needs in trouble and insolvency related concerns. With an intention to increase proficiency will certainly establish a sense of transparency and predictability required by international business to undertake their operations across Middle East. The ongoing bankruptcy law clings to worldwide patterns and best practices in DIFC. Moreover, the huge spotlight on rebuilding and saving organizations, as opposed to selling organizations, puts the enactment at the cutting edge of universal obligation rebuilding development. In furtherance, DIFC Insolvency Law embraces the UNCITRAL Model Law on Cross-Border Insolvency, the arrangement energizes participation and coordination between multi-jurisdictional indebtedness procedures and lines up with the DIFCs general objective to accomplish acknowledgment as a worldwide business center point. The incorporation should assist with guaranteeing an increasingly organized and unsurprising way to deal with multi-jurisdictional restructurings and bankruptcies for the many cross-border organizations in the DIFC. Lastly, the new Insolvency law of DIFC introduces a new concept of rehabilitation allowing companies (who are unable to pay off their debt) to reach with an agreement with their creditors can apply for the regime of rehabilitation. In such event the directors of the company can directly approach the courts of DIFC

2. and can present proposal to the creditors for rehabilitation, wherein the creditors can vote if they are satisfied with the companys restructuring policies, which certainly assist the company to keep their business and simultaneously assures the creditors the security of their unpaid debt. Related Links Can Impact of Coronavirus be a Force Majeure Event? Remote Attestation Amidst Covid-19 in UAE Dont Miss Out New Electronic Insurance Policies In UAE! Copyright © of this article is retained by the author and/or other copyright owners. We explicitly grant you permission to download a copy, without any alteration, of this article for personal non-commercial research or study, without prior permission or any charge. This article can be utilized on your website or for marketing, however, we grant you permission to host this article on your website and no other rights. This content should not be altered in any way or sold commercially in any format without prior permission of the copyright holder. During reference of this article, full biographic details entailing the name of the author, his designation, the institute and the publishing date of the article shall be provided. Contact Us The H Hotel Office Tower, 29th Floor, Office 2904, Sheikh Zayed Road, PO Box 40073, Dubai, United Arab Emirates Tel: +971 4 355 8000 | Fax: +971 4 358 9494 Office No. 804, 8th Floor, Tamouh Tower Marina Square, Al Reem Island, PO Box 129980, Abu Dhabi Tel: +971 2 650 1211 | Fax: +971 4 358 9494 Email us: hassan@professionallawyer.me