In addition to the comprehensive economic support and stimulus program launched by the UAE Central Bank to curb the financial impact of the COVID-19 pandemic, the UAE has introduced radical amendments to the UAE Bankruptcy Law, offering distressed debtors with some level of leniency during these times of economic uncertainty and market disruption caused by circumstances outside of their control.
Key changes include: adding new provisions to the law related to “emergencies” such as pandemics and natural and environmental disasters; new debtor’s rights to delay filing for bankruptcy and to resort to out-of-court settlement agreement with creditors; and mechanisms to obtain new financing under certain rules and conditions.
