Insolvency law introduced, puts stress on rehabilitation

Koo Jin Shen
BANDAR SERI BEGAWAN

THE Ministry of Finance (MoF) has announced that the Insolvency Order 2016, a new legislation covering insolvency in the country, is now in effect.

“The Ministry of Finance is pleased to announce that His Majesty the Sultan and Yang Di Pertuan of Brunei Darussalam has consented for the introduction of the Insolvency Order 2016 which is effective on March 1, 2016,” the ministry said yesterday.

The MoF said the Insolvency Order is a new law which incorporates the winding up provisions relating to corporate insolvency under Chapter 39 of the Companies Act.

It also includes new provisions which had been adopted from the United Kingdom and Singapore, according to information posted on the government’s Ease of Doing Business portal www.business.gov.bn.

“It is intended to create a shift in the insolvency culture, with a greater emphasis placed on company rescue and rehabilitation, and protection for all creditors and debtors,” according to the website.

Among the new features of the order are provisions on company voluntary arrangements which allow a company to propose a possible loan restructuring and/or corporate reorganisation to its creditors. To complement this new provision in winding up of a company, a new list of preferential payments will be paid in priority to all unsecured debts.

The new order also includes provisions for the introduction of insolvency practitioners.

The insolvency practitioner acts as a liquidator, provisional liquidator, judicial manager or receiver. He/she can be a nominee or supervisor, where a voluntary arrangement in relation to the company is proposed or approved, according to the new order.

The new order notes that important issues of suitable qualifications, technical knowledge and skills, standards of competence and other related areas are central to the proper functioning of an insolvency regime and the finance minister may designate a recognised professional body to regulate the practice of insolvency practitioners.

More information on the insolvency order can be obtained through www.business.gov.bn or the MoF website www.mof.gov.bn. Printed copies of the Insolvency Order are available for sale at the government’s printing department. It can also be downloaded from www.agc.gov.bn.


Sumber - The Brunei Times