DUBAI: Dubai’s ruler Sheikh Mohammed bin Rashid Al-Maktoum
issued a new insolvency law on Tuesday for companies operating in
the Dubai International Financial Center (DIFC), the largest
financial hub in the Middle East, Africa and South Asia.
The new law, due to come into effect in August, has been issued
following the collapse of Dubai-based private equity firm Abraaj,
which had a DIFC-regulated entity Abraaj Capital.
The firm that had been the Middle East and North Africa’s biggest
buyout fund unraveled after a row with some investors over the use
of money in a $1 billion health care fund.
The new law introduces a “new debtor in possession bankruptcy
regime” for debtors that have filed for bankruptcy but still hold
assets, according to a statement on the Dubai’s ruler official
Abraaj, its founder Arif Naqvi and a former executive are being
investigated by the US Securities and Exchange Commission (SEC) on
US charges that they defrauded investors, including the Bill &
Melinda Gates Foundation.
The Dubai Financial Services Authority (DFSA) said in April it was
in touch with the SEC and had been investigating Abraaj Capital
Ltd, an entity of the collapsed firm, over a range of matters but
has not specified what they are.
Founder of Dubai-based Abraaj released from UK prison after paying
$19m bailAbraaj founder given more time to raise £15m pound bail
Source: FS – All-News-Economy
Dubai issues new financial center insolvency law after Abraaj collapse