WHAT IS BANKRUPTCY IN THE UAE ?
Bankruptcy in the uae is a legal status of a person or other entity that cannot repay debts to creditors. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the debtor.
Any person can be declared bankrupt, as long as, the payment of his/her financial dues are postponed, due to, unsteadiness of his/her credit or his/her financial position is not sufficient to pay off his/her due financial debts.
Bankruptcy in the UAE can be declared, upon the request of the trader him/her-self, or, upon the request of one of his/her creditors, or, upon a request filed by the Public Prosecution, or based on the court’s accord.
We shall shed the light; in this article, upon the petitions filed by the trader him/her-self or by one of his/her creditors for judgement on Bankruptcy in the UAE. In case of a petition filed by the trader him/her-self, it must be done within thirty (30) days starting from the date of payment suspension of his/her due financial debts, otherwise, it shall be considered a crime; bankruptcy offender.
How To File In For Bankruptcy In The United Arab Emirates (UAE)
As earlier highlighted, the petition for bankruptcy in the united arab emirates could be claimed individually or otherwise and for this to be done individually, such petition shall be filed before the competent civil court, meanwhile, the trader must submit the following:
- The main commercial books.
- A photocopy of the last balance sheet audited in accordance with the accounting principles and the profit and loss account.
- A statement of the total personal expenses for the last two years before the petition for bankruptcy in the uae or for the period of his engagement in commerce in case it is lesser that that.
- A detailed statement of the real estates and movables owned by him and their approximate value as of the date of suspension of payment.
- A statement of the names and addresses of creditors and debtors, and the amount of their dues or debts and the secured deposits.
- A statement of the protests made against the trader during the last two years prior the petition for bankruptcy in the uae.
Any creditor can file a petition requesting his debtor to be bankrupt if he/she proves with evidence the postponement of the payment of his/her financial dues. Whether the debtor is in debt of a commercial or a civil debt in favor of his/her creditor.
WHAT THE UNITED ARAB EMIRATES LAW STATES
The U.A.E. Commercial Transactions Law; Law number 18 for 1992, widened the scope of punishments inflicted upon different persons in there different capacities, throughout the Bankruptcy procedures until the adjudication of Bankruptcy.
The foregoing law, stated different actions that incriminates its doers. Imprisonment or fines or both are the punishments legislated. The capacity of the incriminated action doer, differs under such law. The legislator; while promulgating the law, was keen on penalizing numerous actions taken by, the merchant him/her-self if bankrupt, whether he/she is a serious negligent merchant, of whom, caused harm to his/her creditors or not. He also penalized actions taken by members of board of directors, managers and liquidators to a bankrupt company.
Despite the judicial confidence provided for the trustees of bankruptcy in the UAE, the legislator incriminated different actions taken by them. He also did not miss the bankrupt’s spouse, along with, their descendants and ascendants. The legislator stated distinct actions taken by them that must be penalized. He did not leave even creditors out of the circle of incrimination.
In conclusion, all parties to bankruptcy procedures must abide by law and regulations, in order for, all of them to be left out of judicial and legal offences.
For further assistance on how to handle safely your matters if related bankruptcy in the united arab emirates(UAE) or any commercial law related issues in the UAE, kindly contact us or you can book an appointment for an online support on any legal matters in the United Arab Emirates(UAE)