KUALA LUMPUR: A number of revisions to the Insolvency Act 1967 (Act 360) have been placed by the Insolvency department in an attempt to improve the bankruptcy management procedure and speed up the release of bankruptcies.

The proposed amendments are expected to be presented in the cabinet meeting soon.

Minister in the Prime Minister's Department (Law and Institutional Reform) Datuk Seri Azalina Othman Said said the automatic discharge provision under section 33C of the Act would be improved to allow bankruptcies be discharged in a shorter period.

"The government will also establish a time frame for the submission of Proof of Debt Forms by creditors to prevent the problem of filing delays that can make it challenging to discharge individual bankrupts," she said in a statement.

Azalina was responding to a New Straits Times report of Hairul Nizam Hashim's predicament to get out of bankruptcy.

Hairul, who was declared bankrupt in 2013 said he had to hire a lawyer to have his bankruptcy status removed, but was told that it would take up to a year before he could get himself off the list.

He also expressed his dissatisfaction with the lack of programmes to assist bankrupts be discharged.

Meanwhile, Azalina said another improvement that the department was looking into was utilising information technology and long-distance communication to facilitate the administration of the bankruptcy process, particularly for the clients and stakeholders.

The department would eliminate the need to hold the first meeting with creditors to ensure that bankruptcy administration could be done immediately, she added.

Azalina said the department would also look at expanding the list of cases that could be discharged through the Certificate of Discharge (KPI Certificate) without objection by the creditor.

"The categories are for bankrupts who are 70 years old and above and bankrupts who are incapable because they have been certified as mentally ill under the Mental Health Act 2001 (ACT 615)," she said, adding that an average of 27 bankruptcy cases were released every day in 2022.

In keeping with the current state of the economy and the cost of living, Azalina said, the department would also modify the value of bankrupt property, including work equipment that can be exempt from distribution to creditors under section 48(1)(a)(ii) of Act 360.

The threshold amount for the administration of small bankruptcies under section 106 of Act 360 and the wage earner salary limit under section 107 of Act 360 would also be coordinated with the state of the economy and the minimum wage policy, she added.

"The government always welcomes any constructive feedback and suggestions from all parties regarding bankruptcy issues, therefore, an engagement session with stakeholders to discuss matters related to the proposed amendment being considered will be held on February 7, 2023.

"Meanwhile, the proposed amendment to the Insolvency Act 1967 [Act 360] is expected to be presented in the cabinet meeting in the near future after taking into account engagement session input," she said.

https://www.nst.com.my/news/nation/2023/02/876101/insolvency-dept-speed-release-bankruptcies-azalina