Federal Decree-Law 51 of 2023 governs insolvency debt recovery in Dubai

Federal Decree-Law No. 51 of 2023 governs insolvency-related debt recovery in Dubai for companies and traders, effective May 1, 2024. The law establishes three procedures: preventive settlement for debtors in financial difficulty, court-supervised restructuring voted on by creditors, and bankruptcy with asset liquidation under a trustee. Once proceedings open, judicial and execution steps are generally suspended, and creditors must submit claims within court-set deadlines. Creditors must identify the governing regime, prepare and submit claims with supporting documentation, verify security and ranking, and monitor restructuring votes. Secured creditors retain enforcement rights through the bankruptcy court. For individuals who are not traders, Federal Decree-Law No. 19 of 2019 applies. DIFC and ADGM entities follow their own insolvency regimes. Key steps include submitting the claim on time with contracts, invoices, and statements of account; clearly stating whether the claim is secured; and following up on the trustee's review.