Two new categories for bankruptcy discharge under Insolvency Act amendments

KUALA LUMPUR: There will be two new categories for individuals to be discharged from bankruptcy status under the new amendments to the Insolvency Act 1967, says Datuk Seri Azalina Othman Said.

During the second reading of the Bill at the Dewan Rakyat on Tuesday (May 23), the Minister in the Prime Minister's Department (Law and Institutional Reform) said the two categories are those who are over 70 years old and individuals with mental illnesses certified by government psychiatrists.

"The two categories can be discharged from bankruptcy status through the issuance of an Insolvency Department director-general's certificate without creditor's objection.

"This group no longer has the ability to cooperate and contribute to the bankruptcy administrations," she said.

Azalina said based on a report by the Insolvency Department, a total of 19,913 bankrupts aged 70 and above are eligible to be considered for relief through a certification from its director-general if they meet set conditions.

Other recommendations for the amendments are using information technology in the administration of bankruptcy cases; conduct meetings with creditors; and improve the automatic mechanism for the discharge of bankrupt status.

The Dewan Rakyat will resume the debate session of the amendments on Wednesday (May 24).

The amendments to the Insolvency Act, Azalina said, are in line with the "second chance" policy to help those who were declared bankrupt and to give them an opportunity to improve their financial status and contribute to the country's economy.