The Malaysian Lawyer

 

On 24 April 2025, I spoke on the BFM radio station to speak on recent developments in the field of insolvency. First, with Malaysia’s intention to adopt the UNICTRAL Model Law on Cross-Border Insolvency through the Cross-Border Insolvency Bill. Second, the challenges of recovering overseas assets. Third, the rise of voluntary bankruptcies in Malaysia.

Set out below is an extract of one of the questions and my answer.

Why is it important for Malaysia to have specific laws on cross-border insolvency, especially on the business front?

Right now, Malaysia doesn’t have clear laws to recognise foreign insolvency proceedings. That’s a gap. But with the proposed Cross-Border Insolvency Bill, I believe it offers a strong economic selling point.

Malaysia is already open for business — we welcome foreign investment, and we make it easy to set up operations. But we also need to give foreign companies confidence that if they undertake a foreign restructuring or foreign insolvency, their Malaysian assets are protected and can be dealt with smoothly for repayment of debts.

This means certainty — certainty to operate here, even during foreign distress, and certainty that property can be repatriated or recovered efficiently.

Think of it this way — Malaysia welcomes foreign companies through special economic zones and secondary listings on Bursa Malaysia. If the company undergoes a restructuring or a liquidation, the Cross-Border Insolvency Bill ensures there’s a clear, predictable path to wind things down.

You can listen to the full 10-minute podcast on the BFM website.