Insolvency Dept submits proposal to improve Act 360 - minister

 

Amendment to Section 33C of the Insolvency Act (Act 360) in regard to automatic discharge from bankruptcy after three years is among the proposals submitted by the Insolvency Department to the government to improve the law.

Minister in the Prime Minister’s Department (Parliament and Law) Wan Junaidi Tuanku Jaafar said the proposed amendment was to help more bankrupt people get out of bankruptcy after three years.

In a statement today, he said the department also proposed to set a time limit for the filing of the proof of debts form by creditors to speed up the process of bankruptcy discharge or cancellation of the bankruptcy order.

Wan Junaidi said the third proposal was to abolish the first meeting of creditors.

“It proposed for the creditors' meetings to only be held based on the needs and requests of creditors to avoid delays and enable subsequent planning to be made to help the bankrupts get out of bankruptcy,” he said.

Also proposed is the use of more long-distance communication technologies in bankruptcy administration matters, which can help bankrupts deal with the Insolvency Department online.

“The main focus of the Insolvency Department is to speed up the bankruptcy administration process and help bankrupts to get out of bankruptcy immediately,” he said.

Wan Junaidi said the proposals would be studied in detail by the Legal Affairs Division and the Attorney-General’s Chamber and discussed in engagement sessions with stakeholders before being finalised.

Meanwhile, he said the bankruptcy statistics showed a declining pattern, with 12,051 cases recorded in 2019 to 8,351 cases in 2020, 6,554 cases in 2021 and 3,604 as of July this year.

“This is due to several factors including the government’s initiative through loan moratoriums and targeted assistance by banks where lenders (creditors) and borrowers can discuss options to restructure debt,” he said.

- Bernama