The Ministry of Justice on July 18 organized a consultation workshop on draft amendments to the Law on Rehabilitation and Bankruptcy of Enterprise. The draft amendments are expected to be soon submitted to the National Assembly for consideration for approval.
The meeting was held in Vientiane Capital in the presence of the Vice Minister of Justice Seumsouk Simphavong, World Bank Group Senior Financial Sector Specialist Nina Mocheva, and relevant officials.
The draft amendments to the Law on Rehabilitation and Bankruptcy of Enterprises are crucial for ensuring the addressing of insolvent enterprises’ financial affairs in a lawful, efficient and uniform way that protects the legitimate rights of creditors, debtor enterprises and other related parties, said the Vice Minister.
The amendment of the law aims to promote confidence in the credit system, ensure economic stability and growth and create favorable environment for doing business, investment and national socio-development.
Once approved by the National Assembly, the Law on Rehabilitation and Bankruptcy of Enterprises will consist of 13 parts and 104 articles. Thirty six of which are new articles, according to the minister.
The Law should allow debtors or IP to accept or reject ongoing contracts, avoid preferential or undervalued transactions and obtain post commencement financing on priority terms. The law should allow all creditors to vote on the recognition plan and also provide equal and fair treatment to dissenting creditors, said Ms Nina.
In resolving insolvency, the Doing Business report classifies the Lao PDR as a no-practice country one of the bottom 23 economies with this designation while the report covers over 190 economies.
Since the adoption of the current Law on Bankruptcy of Enterprises in 1994, only one bankruptcy case has gone to a final decision in a court of first instance.
Source: Lao News Agency