UAE to introduce debt protection law in January 2020
The federal law will support individuals facing insolvency issues…
The UAE Cabinet has announced that it will introduce a new federal law in January 2020, which will protect citizens and residents facing debt struggles. The legislation will protect people who are struggling to pay off their debts from prosecution, by placing them on a three-year plan.
During this time, they will be given the opportunity to work and support their family while repaying the debt. A court-appointed expert will assist in the plan and liaise with creditors, so that the debtor can pay their dues and avoid legal prosecution.
No further loans will be permitted during the three year period, or until the previous debts are paid off. The expert will also help in the negotiation of fees and restructuring of debt so that a fair compensation plan is put in place.
— UAEGov (@uaegov) November 17, 2019
The support will be available to individuals facing existing or anticipated financial difficulties from the beginning of next year. Anyone who is facing insolvency issues and facing fears of prosecution will be protected by the legislation and permitted to be productive and provide for their families until the debt is paid.
By regulating the insolvency cases, the UAE aims to improve its competitiveness by making the economic environment of businesses and individuals more favourable.