Published: Feb 25, 2019

5 Things to know about the New Restructuring Insolvency Regime in Bahrain

Bahrain recently introduced the Restructuring and Insolvency Law, as a step towards strengthening the legal framework and business ecosystem in Bahrain.

Watch our latest video to learn more about the new Law.


Key Facts:

  1. The new law is expected to boost transparency and efficiency in the insolvency by bringing in reforms to bolster globally accepted good practices in Bahrain such as promoting restructuring procedures, regulating insolvency administrators, strengthening creditors’ rights, clarifying rules for commencing insolvency proceedings, improving provisions applicable to treatment of contracts and voidable transactions and introducing provisions on post-commencement financing.
  2. By promoting and prioritising debt restructuring proceedings over liquidation procedures, the new law aims to prevent the liquidation of businesses with potential and reduce failure rates amongst small and medium-size enterprises.
  3. Commencement of insolvency proceedings does not prevent the debtor from continuing its day-to-day business as well as utilising its properties for necessary transactions, if carried out in the ordinary course of business.
  4. By recognising foreign insolvency proceedings, the laws provide for a mechanism of cooperation between courts and competent authorities in Bahrain and foreign countries where insolvency proceedings are simultaneously brought against the same debtor.
  5. The introduction of the new insolvency regime is a significant step towards dissolving the stigma of insolvency amongst businesses operating in Bahrain, by providing efficient exit frameworks, whilst allowing lenders in the market to make significant recoveries.


Want to know how the new law will impact your business? Our team of experts are here to help…

Al Tamimi & Company’s strength in restructuring and insolvency lies in our multidisciplinary practice and cross-regional reach. Our team’s competencies enable us to find timely solutions for businesses in financial difficulties and advise the managements of distressed companies into navigating out of early stage crisis.

If you have any questions, please feel free to contact us.

Foutoun Hajjar
Partner, Head of Office – Bahrain
Corporate Commercial

Siddharth Goud
Trainee Lawyer,
Corporate Commercial