MUSCAT: Oman will introduce a new bankruptcy law that allows the debtor to request a protective settlement if their financial business is disturbed.
The law that will come into effect from July 7 will establish rules and regulations governing bankruptcy filing.
Speaking to the media earlier, Mohamad bin Rashid Al Badi, the acting director of the Ministry of Commerce (MOCI), said the new law will set the conditions for bankrupt parties to pay off creditors according to a previously agreed upon restructuring plan.
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“The debtor who has stopped paying his debts can apply to the audit and control of commercial establishments department at the Ministry of Commerce and Industry (MoCI) to request restructuring through settling the disputes with creditors, provided the debtor continued his business during the two years preceding the filing of the application and that no final judgement has been issued against him towards declaring bankruptcy,” Al Badi said.
“In order to settle disputes between creditors and debtors, ‘the competent department’ must hold mediation sessions. The law allows the debtor to request a protective settlement if his financial business is disturbed,” Al Badi added.
However if a trader falsely pretends bankruptcy, courts will impose fines or between OMR 200 and OMR 500.
