KUALA LUMPUR, March 29 — Bankruptcy proceedings against Malaysians will become a last resort move if Parliament approves proposed changes to the Bankruptcy Act 1967, minister Datuk Seri Azalina Othman Said said today.
Azalina said the Bankruptcy (Amendment) Bill 2016, which was tabled for second reading at the Dewan Rakyat today, is aimed at reducing the bankruptcy rates in the country.
The proposed amendments will make bankruptcy proceedings the “last choice” instead of the first choice in any enforcement of court decisions, she said.
It will also “create an alternative method to bankruptcy proceedings before an individual is made bankrupt.”
“A bankrupt individual who fulfills the criteria for release has the potential to be released faster to stimulate the country's economic growth and development and at the same time creditors would benefit when reasonable contributions are made by debtors,” the de facto law minister said.
The proposed law changes will also simplify bankruptcy proceedings and the process of administering bankruptcy cases, she said.
The amendments will create a society that is wise in managing their finances and more responsible in paying debts owed, as well as ensure creditors are more prudent in providing facilities for loan repayment, she said.
Azalina had said the Malaysia Department of Insolvency is as of this February administering 293,086 active bankruptcy cases nationwide, with Selangor currently accounting for almost one-fifth of the country's bankrupt individuals.
“Out of the total number of bankruptcy cases, Selangor recorded the highest number of bankruptcy cases in the country with 70,817 cases,” she said when tabling amendments to the Bankruptcy Act for second reading.
Noting that 58.57 per cent of bankruptcy cases in Malaysia involve those in the 25 to 44 age group, Azalina said these figures were worrying.