Bahrain introduces bankruptcy law in legal reform push

Bahrain is introducing a raft of legal reforms to make itself more business-friendly. (Reuters)

• Bankruptcy law offers Chapter 11-style protection
• New laws come as foreign investment surges

LONDON: Bahrain has introduced a new bankruptcy law as it ushers in a raft of new legal reforms aimed at drumming up inward investment.
The country has seen foreign investment increase rapidly over the last year and wants to cement gains by boosting its corporate legislation and making it more business-friendly.
The Bahrain Economic Development Board (EDB) attracted a record $810 million of investment during the first nine months of the year compared to $733 million in 2017 as a whole.
In addition to the new bankruptcy code, Bahrain is also introducing a personal data protection law, new health insurance legislation and a competition law.
Khalid Al-Rumaihi, the CEO of Bahrain Economic Development Board, said: “We are very excited to see the impact of these new laws, which will help to enhance the environment in existing industries as well as open new opportunities to investors The future prosperity of the GCC depends on growth driven by higher productivity and on embracing the new industries that will drive growth in the decades to come.”
The new bankruptcy law will introduce measures to allow company reorganization where the management is allowed to remain in place and continue business operations during the administration of a case, similar to the Chapter 11 process in the US.
It also includes provisions for cross-border insolvency, and special provisions in relation to the insolvency of small and medium-sized enterprises, which provides a higher threshold of protection to those enterprises.