The UAE legislated the protection of its citizens and residents who are unable to pay off their financial dues from legal prosecution.
The new law, which will come into effect from January next year, safeguards individuals who are either facing or foreseeing financial turmoil, leaving them incapable of settling their debts.
The legislation will permit debtors to be productive, work to lay off their debt and support their families, WAM reported.
The debtor can settle his financial obligations via a court-appointed expert, who will liaise between him and the creditors to draft a plan.
Debtors will not be permitted to take on any further loans during the three-year plan until previous dues are paid off, the statement said.
— UAEGov (@uaegov) November 17, 2019
The legislation calls for reduced fees for rescheduling and restructuring of debts to offer a fair compensation to all stakeholders.
Furthermore, the mandate to regulate insolvency cases will augment the country’s competitiveness by offering ease of doing business and a favourable economic environment for indviduals.
Also read: UAE issues law allowing federal debt issues