PETALING JAYA: The government will enforce new amendments to the Insolvency Act 1967 from tomorrow, says law and institutional reform minister Azalina Othman Said.
Azalina said the Cabinet agreed to the proposed amendments in March following a series of engagement sessions with stakeholders, including the finance ministry, Bank Negara Malaysia, and the Attorney-General’s Chambers.
“The enforcement of the Act reflects the government’s commitment to ensuring that no segment of the population is left behind in the country’s development,” she said in a statement.
“This also demonstrates the government’s efforts to give bankrupt individuals a second chance to lead better lives.”
The amendments include provisions related to bankruptcy discharge, with Section 33C of Act 360 amended to facilitate the automatic discharge of bankrupt individuals within a period of three to five years from the date they submit their statements.
The list of bankrupt individuals eligible for discharge without going through the creditor’s objection procedure has also been amended to include two new categories.
They are bankrupts who are 70 years old and above, as well as those who have been certified as mentally ill under the Mental Health Act 2001 (Act 615).
Additionally, the obligation of the director-general of insolvency to hold the first creditors’ meeting has been abolished.
The Act also reviewed two items that would further safeguard the welfare of bankrupt individuals – the threshold value of a bankrupt person’s assets that can be exempted from distribution among creditors, and the threshold value of qualifying cases, for more simplified administration.
Azalina said these amendments were in line with the second-chance policy to help bankrupt individuals improve their financial status.
“They aim to discharge up to 130,000 bankrupts within one year after the enforcement of the Act,” she said, adding that the number represents half of the total cases currently being handled by the insolvency department.
