Corporate Rescue Culture in Saudi Arabia and Egypt: A Comparative Review of New Bankruptcy Laws

Hamza E. Albaheth

Shari'ah and Law Collage, Taif University, Saudi Arabia

Abstract:

Legislators in Saudi Arabia and Egypt have enacted new bankruptcy laws in respective countries that are radically different from the prevalent laws. The objective of this paper was to discuss whether these bankruptcy laws in Saudi Arabia and Egypt created a secure corporate rescue culture similar to corporate laws in developed countries. A conceptual framework was chosen to find out whether the new laws promoted a corporate rescue culture. The exploratory research method in this qualitative study examined the secondary sources including published journal articles and data on government websites. It was revealed that the new rescue laws provided an efficient framework for out of court settlements and restructuring. It provided assurance to investors during the unstable investment climate protecting both the interest of debtors and creditors. Thus, these laws had many similarities with laws in the western countries particularly the EU and the US. These findings would help policy makers and investors to know about the present corporate climate in the Middle East and North Africa (MENA) region.

Keyword:

Saudi Company Law, Saudi Bankruptcy Law, Egyptian Bankruptcy Law, Corporate Rescue, Foreign Investments.