TL; Dr.
- A new bankruptcy court is being started, based on it
Abu Dhabi Federal Court Of the first example. - This will handle all disputes under UAE’s updated bankruptcy laws.
- Special judges and financial experts will manage complex insolvency and reorganization matters.
The UAE has presented a special bankruptcy court to handle financial crisis and bankruptcy cases. The decision issued by the Minister of Justice is part of comprehensive efforts to strengthen the country’s legal system and support economic stability.The move is to streamlined the move on how to handle a central court in Abu Dhabi and for additional branches in other Emirates, how to handle the matters of bankruptcy. This ensures that businesses and individuals facing financial challenges have a clear, structured legal path, whether it is restructured, preventing liquidation, or disputes.The decision aligns with the federal decree-law number (51) of 2023, which meets the country’s financial restructuring and bankruptcy rules.The Ministry of Justice said to an official post, “The move aims to develop a judicial structure that supports the national economy and increases the effectiveness of the justice system in dealing with financial crisis and bankruptcy matters.”
The bankruptcy court explained: how it works and what is expected
1. Located in Abu Dhabi, with flexibility to expandThe main bankruptcy court will be based on the first example Abu Dhabi Federal Court. But this is not limited to the capital. If necessary, officers can open branches in other Emirates. No matter where they are located, these courts will have the same power to handle cases.2. All types of bankruptcy handles controversiesThe court will deal with everything coming under the UAE’s updated bankruptcy law, officially known as the federal decree-law number 51 of 2023. This includes:
- Financial reorganization request
- Preventive settlement schemes
- Insolvency filing
- Any disputes, objections or complaints related to these procedures
Originally, if it is to be done with a financial crisis or insolvency, this court is where it goes.3. Was run by judges who know the jobThis will not be a normal court. It works with special judges, including a Chief Justice, who does not rank less than the appeal judge. These judges are appointed by the Federal Judicial Council, and will be supported by a dedicated team that handles all paperwork, case registration and official information.4. Expert aid for complex casesThe court is not working alone. This can bring financial experts and advisors to assist in cases. their job?
- Manage the property and operation of the debtor
- Meet creditors
- Apply immediate measures if needed
- Help pursue things faster
This makes it easier to deal with complex cases, which require both legal decisions and financial information.
The Big Picture: Why it matters
Insolvency laws are often misunderstood or seen as the last remedy. But in fact, a solid bankruptcy structure can save businesses, protect jobs, and preserve the creditor rights, without closing a company.With the new court in place, UAE is:
- It is easy for companies and individuals to manage loans legally.
- Providing options for liquidation, such as out-of-court settlements or structured repayment schemes.
- Improves investor’s confidence by ensuring transparent and fair processes.
UAE Understanding Ins bankruptcy law
The UAE’s bankrupt law applies to registered companies that fall under the law of commercial companies, as well as traders and licensed professionals through civil companies. Before reaching the stage of liquidation, the law offers several legal options. These include out-off-court financial reorganization, interaction settlements (also known as composition processes), and formal restructuring of supervision by the court. In some cases, the court may allow the debtor to secure new debt to help run the business. If none of these solutions work, the final stage is declaring bankruptcy and proceeding with the liquidation of assets.
Fasting
- 1. Who can file for bankruptcy in UAE?
Companies facing financial crisis can file under traders and licensed professional laws.
- 2. Will bankruptcy court take over both companies and individuals?
Yes. As long as they fall under the categories mentioned in the law, both businesses and individuals can file.
- 3. How does it help businesses?
This gives them a structured way to deal with debt, avoid liquidation, and possibly continuing to operate through financial restructuring or settlements.
