Kuwait Finalising GCC's First Insolvency Law

Kuwait is finalising what will be the Gulf's first insolvency legislation designed to help failed businesses recover from financial difficulties rather than be shutdown, leaving creditors out of pocket, ArabianBusiness.com reported. The draft law would allow companies at the brink of financial collapse to seek court protection and business rehabilitation, instead of liquidation, DLA Piper regional managing partner Abdul Aziz Al Yaqout, who has been working on the legislation, told Arabian Business. The company's assets would be preserved to allow it to continue trading and potentially recover losses owed to creditors. The process of business rehabilitation, common in the West, saved General Motors following the global financial crisis. The lack of insolvency protection for businesses, especially for entrepreneurs, has often been cited as a deterrent to establishing or growing a business that require hefty loans. The UAE also is writing an insolvency law that is believed to be designed to allow businesses to rehabilitated under court protection. Read more.