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Experts: UAE’s ‘urgent’ need for more effective insolvency regime
New white paper identifies current flaws and recommends way forward.
June 23, 2010 1:42 by Samuel Potter
There is a growing urgency for a more effective insolvency regime in the UAE, according to a new white paper.
The Institute of Chartered Accountants in England and Wales (ICAEW), a leading organization in the accountancy and finance profession, has collaborated with the Dubai International Arbitration Centre to create the new paper, which outlines a series of strategic recommendations for improving the regime.
The paper is entitled ‘Inspiring Business Confidence in the UAE Through Effective Insolvency Systems,’ and identifies the draw backs to current laws and “highlights how business confidence depends on clear and transparent rules for dealing with businesses in trouble,” says AMEinfo.com.
Amanda Line, Regional Director, ICAEW Middle East, said: “It is widely acknowledged that the current insolvency regime needs improving to offer better support and guidance to businesses experiencing problems. The economic crisis has made this an issue requiring urgent attention for the UAE to remain an attractive place to both businesses and investors.
“If dealt with early, a business in trouble can often be helped or restructured, safeguarding creditors’ interests and employees’ jobs. However, more needs to be done to increase the level of knowledge and understanding about insolvency, and especially restructuring, in the UAE.”
The papers’ recommendations include forming a body of licensed Insolvency Practitioners and reforming the law to protect creditors’ rights and reduce the risk of business for investors.