Debt Restructuring, Preventive Settlement & Liquidation
Restructuring & Insolvency
The instruments of the Saudi Bankruptcy Law in their entirety, invoked at the stage at which the enterprise remains capable of rescue.
/ The Practice
The Saudi Bankruptcy Law issued in 1439 AH altered the manner in which the legal system meets an enterprise in difficulty. What had been a single gate opening upon liquidation became five graded procedures: preventive settlement, financial reorganization, liquidation, settlement for natural persons, and simplified procedures for small enterprises. Within that scheme the Firm conducts matters of financial distress, from negotiated settlement, through preventive settlement and financial reorganization, to liquidation where the alternatives are exhausted.
Contact the Firm/ Practice Details
Scope: Conducted by its own specialists, in coordination with Corporate & Transactions
Serves: Enterprises under financial strain, creditors pursuing claims against debtors, banks and financiers, and shareholders facing the restructuring of a holding
Focus: Preventive settlement, financial reorganization, creditor negotiation, claims administration, and judicial and administrative liquidation
Engagement: Diagnosis, election of procedure, negotiation, filing
Enquiries: Submit the Matter
/ The Reading
Preventive settlement carries considerable force, and that force is contingent upon timing. It must be filed before the strain compounds, it requires disclosure to creditors, and it requires a plan the bankruptcy judge is able to approve. Administered upon that understanding, these instruments preserve the enterprise. Administered without it, they become a period of delay preceding liquidation.
/ Scope of Services
Preventive Settlement
Preventive settlement before the bankruptcy courts, filed at a stage early enough to operate, upon the disclosure creditors require and a plan capable of approval by the court.
Financial Reorganization
Financial reorganization of enterprises under strain, including the valuation of assets, the priority of creditors under the present rules, and the appointment and supervision of registered bankruptcy trustees.
Creditor Negotiation & Claims
Negotiation with creditors and the administration of their claims, and the representation of creditors in the insolvency proceedings of their debtors.
Judicial & Administrative Liquidation
Judicial and administrative liquidation where the alternatives are exhausted, conducted so that the distribution withstands the scrutiny to which it will be subject.
/ Method
The work is commenced upon a candid reading of the figures and the calendar: the time remaining to the enterprise, the creditors holding the stronger claim, and the procedure the facts in truth support. The election of procedure is the determination upon which the matter turns.
/ Standards of Engagement
Filed Within Time
The procedures under the Bankruptcy Law reward early filing, and the first session accordingly addresses the period remaining and the courses foreclosed by each further month of delay.
A Plan Capable of Approval
Restructuring plans are constituted to be performed and to satisfy the bankruptcy judge, since a plan incapable of performance procures nothing beyond time.
Candid Upon the Figures
The Firm states what the figures support, including where an enterprise is beyond rescue, so that shareholders determine their course upon the position as it stands.
/ The Firm's Commitment
The reading given at the outset is the reading to which the Firm holds, including where it points away from the outcome the shareholders had sought. An institution apprised of its position early retains courses that are foreclosed to one apprised of it late.
Dr. Bisher Abdulilah
Founder, Hoquqi
