Cabinet approves bankruptcy law
Without a specific law governing bankruptcy, Egyptian individuals and companies facing financial ruin have long had no choice other than to be evaluated by the courts on a case-by-case basis, often facing the specter of imprisonment for unpaid debts. In an attempt to remove this hefty barrier to risk-taking and investment, Egypt’s Cabinet on Jan. 4 approved a draft law that regulates bankruptcy, the country’s first such legislation. According to a Cabinet statement, the law will “deal with cases of faltering companies and merchants to fulfill their obligations.” Further details were not published, but the Cabinet said the law is “within international standards” and “ensures the rights of all parties” including creditors, debtors and employees. Before being enacted the draft law must still pass through several stages, including winning parliamentary approval.