Saudi Arabia recently published a new Bankruptcy Law. This is the latest development of a string of reforms under Vision 2030 to further encourage the participation of foreign and domestic investors by structuring the business legal framework. This article provides a general analysis of the new bankruptcy law and its implications for businesses operating in the Kingdom.
On 22 May 2017, the High Court delivered judgment in favour of two homeowners, Paula and Colm Callaghan, allowing a significant write-down of their mortgage debt and rejecting a proposal by their lender, KBC, that the debt should instead be deferred or ‘warehoused’ for future enforcement.
BACKGROUND
The Callaghans had a mortgage with KBC for over €285,000 for their family home which was valued at just €105,000. The mortgage fell into arrears and the Callaghans sought to enter into a personal insolvency arrangement (PIA).