PETALING JAYA: The Insolvency Act (Amended) 2023 (A1695) will come into force on Friday (Oct 6), says Datuk Seri Azalina Othman Said.
The Minister in the Prime Minister's Department (Law and Institutional Reform) said the amendment resulted from discussions between the Attorney General's Department, Federal Court Chief Registrar, Finance Ministry, Bank Negara Malaysia, Inland Revenue Department, Employees Provident Fund, Credit Counselling and Management Agency and Associations of Bank Malaysia.
"The main amendment strengthens the provision on bankruptcy release, Section 33C Act 360. It helps bankrupts be released from insolvency within three to five years from submitting their details.
"Two new categories have been added to subsection 33B(2A) Act 360 in regards to the category of bankrupts who can be released through a certificate from the director-general of the Insolvency Department without undergoing the procedure on objection of creditors," said Azalina in a statement on Thursday (Oct 5).
She said the two categories are the bankrupts who can't manage their personal affairs due to mental illness according to the Mental Health Act 2001 (Act 615) and those who are 70 years and above, who, according to the discretion of the Insolvency Department director-general, are not able to contribute to their bankruptcy administration.
Azalina said Section 33C applies retrospectively and is in line with the second chance policy.
"The second chance policy aims to release 130,000 bankrupts a year after the amendment to Act A1695 comes into force. This is half of the cases presently managed by the Insolvency Department.
"With the amendment, the requirement for the creditor to meet with the Insolvency Department director-general has been abolished to simplify the administration process,” she said.
Azlina added that to safeguard the welfare of the bankrupt, the Act also assess the value of assets exempted from being divided by creditors and the value for the case to be qualified for summary management.
Azalina said the enforcement of Act A1695 reflects the government's commitment to ensure no group of people is marginalised from the country's development.
"It also proves the government's concern in giving a second chance to bankrupts to carry on with their lives and continue contributing to the development of the country's economy," she added.
