THE Insolvency (Amendment) Bill 2020 aimed at amending the Insolvency Act 1967 (Act 360) has been passed with a simple voice majority in the Dewan Rakyat.

Minister in the Prime Minister’s Department Takiyuddin Hassan, when tabling the bill, said Act 360 was amended based on certain requirements, including transforming the existing legal framework into legislation that is more relevant to current needs.

He said that it was also to update the Act to be in line with the development and advancement of international law on insolvency, corporate governance and best practices in insolvency.

“(In addition, it is to) prepare the country to face any outbreak in the future or any disaster that may cause an economic crisis,” he said when tabling the bill for its second reading in the Dewan Rakyat today.

Takiyuddin said the bill will have a positive impact, such as by giving individuals the chance to strengthen their finances without constraints arising from bankruptcy actions, and boosting economic growth and national development.

He said since Act 360 was approved and published in the Federal Gazette on September 30, 1967, Section 5 (on the minimum bankruptcy limit or minimum bankruptcy threshold) of the Act has been amended four times, with the last one being in 2017.

Takiyuddin said now, the government has again tabled proposals to amend Section 5 of Act 360 to raise the minimum bankruptcy threshold from RM50,000 to RM100,000, and thus make the Act more responsive and comprehensive towards the requirements and current issues regarding insolvency.

He said the government had also made comparative studies regarding insolvency laws in several countries, such as Singapore, Australia, the US and the UK.

He said that most of the countries amended their insolvency laws to suit current needs to avoid a sudden increase in bankruptcy cases as well as to boost their economic growth and national development.

During the winding-up session of the bill, Takiyuddin said that there were 4,151 bankrupts declared, involving Malays (2,312), Chinese (1,028), Indians (307), other races (490), as well as 14 foreigners, based on the Insolvency Department’s statistics as of July this year.

“The total comprises 3,043 men, 1,103 women and five others unknown… this is according to the data I received,” he said.

The Dewan Rakyat sitting continues tomorrow. – Bernama, August 25, 2020.