Early bankruptcy warning system among new insolvency reforms
An early warning system for businesses going bust is among a raft of new rules on insolvency tabled in parliament on Wednesday.
Economy Minister Silvio Schembri presented a series of legislative reforms in acts to be debated in the house. The rules include a system that aims to identify businesses on the brink of insolvency and introduce effective and efficient restructuring mechanisms.
It also lays out new regulations for professionals working in the sector and procedures to facilitate the sale and transfer of property owned by bankrupt entities. Schembri said the reform was aimed at transposing EU laws into Malta’s legislative framework by adopting Directive (EU) 2019/1023, bringing the island in line with international standards. “All in all, the scope of the acts put forward is to encourage an entrepreneurial spirit by means of instilling a mindset that everyone deserves a second chance,” Schembri said. Creditors will be able to maximise recovery of their debts in a timely manner, the minister added.
Reacting to the proposed reform, opposition spokesperson Ivan Bartolo said they were “music to my ears”.
What do the reforms introduce?
A Pre-Restructuring Bill proposes...