The New Bankruptcy Amendment Act: The 10 Changes to Bankruptcy Law in Malaysia

On 21 November 2016, the new Bankruptcy (Amendment) Bill 2016 was tabled in Parliament for its First Reading. It has now been passed as the Bankruptcy (Amendment) Act 2017 and received Royal Assent on 10 May 2017. By way of the gazette notification P.U. (B) 466/2017 dated 3 October 2017, these amendments will come into force on 6 October 2017.

The new Bankruptcy Amendment Act will bring about significant changes to Malaysia’s bankruptcy laws. This comes against a backdrop of rising bankruptcy cases, especially for individuals under the age of 35.


I set out below the 10 major changes to be ushered in under the Bankruptcy Amendment Act. In summary, it can be seen that the new Bankruptcy Amendment Act is more borrower-friendly and will make it more difficult for creditors to commence and maintain bankruptcy proceedings.

I have also subsequently written on How the New Bankruptcy Amendments will Affect Existing Bankruptcy Matters.

 (1) A Change of Name: Bankruptcy Act 1967 to the Insolvency Act 1967

The Bankruptcy Act 1967 will be renamed to the Insolvency Act 1967. Hence, when the new Act comes into force, any written law or document shall be construed as referring to the Insolvency Act 1967 instead.

The use of the term insolvency may cause some slight confusion in future. The Companies Act 2016 uses the term insolvency practitioner to describe a liquidator of a company while there will now be a reference to the Insolvency Act 1967 for the bankruptcy of individuals.

(2) Introduction of the Rescue Mechanism: Voluntary Arrangement

There is a new pre-bankruptcy rescue mechanism called the voluntary arrangement. The salient elements are:

  • The individual, ie. the debtor, will appoint a nominee. The nominee is meant to act as independent professional to oversee and supervise the voluntary arrangement.
  • The nominee can be a chartered accountant, an advocate and solicitor, or such other person to be determined by the Minister.
  • The debtor then files a court application for an interim order for voluntary arrangement. The interim order will only last for 90 days and cannot be extended.
  • The interim order will grant protection: no bankruptcy petition and no legal proceedings against the debtor except with permission from the court.

Within the 90-day interim order period, the nominee will hold a meeting of the creditors to try to secure their approval for the voluntary arrangement. The voluntary arrangement is essentially where the creditors agree to compromise or discount the debts owing to them.

The nominee needs to secure more than 50% in number and at least 75% in value of the creditors’ agreement. However, the secured creditors’ rights cannot be affected without their consent. If the approval is obtained, it will then be binding on all the creditors.

(3) Stricter Requirements for Service of Bankruptcy Papers

The bankruptcy notice must be personally served. Further, substituted service is possible but there are now stricter requirements. The creditor must prove to the satisfaction of the court that the debtor has:

    • The intention to defeat, delay or evade personal service; and
    • Leaves or stays away from Malaysia, or absents himself from his home or place of business.

(4) Higher Threshold for Bankruptcy: RM50,000.00 instead of RM30,000.00

The threshold for the debt for bankruptcy proceedings has now been increased to RM50,000.00 from the present RM30,000.00.

(5) Single Bankruptcy Order

The present law has a sometimes confusing reference to the adjudication order and the receiving order. This will now be simplified to a single unified order called the bankruptcy order.

(6) Social Guarantor: No Bankruptcy

A social guarantor is a person who does not profit and essentially provides a guarantee for an education loan, hire-purchase transaction for personal or non-business use, or a housing loan for personal dwelling.

The present Bankruptcy Act 1967 allows for bankruptcy proceedings against a social guarantor if the creditor had exhausted all avenues to recover from the debtor.

The law will change where there will now be an absolute prohibition in commencing any bankruptcy action against a social guarantor.

(7) Other Guarantors

There is also added protection for other types of guarantors. A creditor will need to obtain permission from the court before commencing bankruptcy proceedings against other guarantors. The creditor would have to demonstrate he has exhausted all modes of execution and enforcement to recover from the debtor first.

(8) New List of Bankrupts to be Allowed Discharge

The following list of individuals will also be afforded protection where creditors cannot object to the discharge of bankruptcy. The individuals are a social guarantor, a bankrupt with a disability under the Persons with Disabilities Act 2008, a deceased bankrupt, and a bankrupt suffering from a serious illness.

(9) Automatic Discharge

There is also a new provision allowing for an automatic discharge of the bankruptcy after three years from submitting his statement of affairs and subject to achieving the target contribution set by the Director General of Insolvency (DGI) and having rendered an account of monies and property to the DGI. The creditors can object to the automatic discharge but there are only limited specified grounds they can raise.

(10) A New Insolvency Assistance Fund

There will be the establishment of the Insolvency Assistance Fund. It will be administered and controlled by the DGI for the purposes of achieving the betterment of the administration and proceedings relating to bankruptcy.


107 thoughts on “The New Bankruptcy Amendment Act: The 10 Changes to Bankruptcy Law in Malaysia

  1. Shanghaifish 23 November, 2016 / 9:27 am

    Can a foreigner who has been declared an adjudicated bankrupt in our courts still work in Malaysia and travel in and out every 3months on a social pass ? I know of some who have taken advantage of this loop-hole to continue making a mockery of our bankruptcy laws. Our courts cannot stamp “Bankrupt” or deport these crooks as per diplomatic reasons not to confiscate a foreign passport. Now they will opt for a “discharge” citing sickness or some bullshit with a note from a “friendly” doctor. Q.E.D.

    • lim kim peu 30 March, 2017 / 12:04 pm

      I, Lim Kim Peu has suggested Bankruptcy Act in Malaysia is already outdated and need to be amended for the development and progress of Malaysia previously through Comment Harakah Daily New Online, Comment facebook title : tulisan dan cita-cita politik terpelik malaysia – mrm. I also e-mail to Bukit Aman Police Headquarter, Bar Council Malaysia, SPRM Headquarter, SUHAKAM, Biro Pengaduan Awam, DAP Headquarter, Permatang Pauh Member of Parliament, all newspapers and others. I said that all developed and rich nations only bankruptcy for a period of 6 months, 9 months, 12 months, 15 months or 24 months depend on the respective countries. In Malaysia if a person was charged bankruptcy by the court and he or she will be bankruptcy for life or forever until he or she pay to the creditors to clear from bankruptcy. This is a very stupid idea and outdated Bankruptcy Act Malaysia. A person face bankruptcy for owing to bank or chetty may be he or she has been cheated money, failure in business, over spending without proper planning, shop or money stolen, sickness (mad, paralyse, handicap, heart attack, kidney failure, blind etc cannot work to pay for the loan). Everybody will make mistake for the first time and the law must help a person to clear his bankruptcy for a period of 3 years and after that automatically discharge or release from the bankruptcy status. Government must help the citizen to be careful for the next time to avoid being bankruptcy for the second or third time. Government must amend outdated Bankruptcy Act to allow Malaysian people who are being charged bankruptcy a second chance to stand up again to do business, to buy houses, to buy land, to go overseas for business or tour, apply business loan or personal loan from banks. If a person enter bankruptcy cannot open Bank Saving Book Accounts, Bank Current Accounts, Bank Personal Loan, Bank Housing Loan, Bank Business Loan, Bank Land Loan, cannot go oversea for business or further studies etc. Once the court declared bankrupt that person properties (house, land, car, motorcycle, share markets, saving in banks etc will be confiscated to pay for debt owe to banks. Once a person declared bankrupt has nothing left with no money, no house, no vehicle and has to support the family. This is like a Malay proverb, “Jatuh Ditimpa Tangga.” A person who is bankrupt will suffer forever until he or she die. He or she cannot progress or stand up again in future and will suffer the situation until he or she die under bankruptcy law. If a person is dead and he or she is also a bankruptcy person. This is a stupid law implemented by MCA, Gerakan and SUPP. Majority of MCA, Gerakan and SUPP with Standard 6 or Form 3 qualification know nothing. They just know how to seize power to rule Malaysia through cheating in all General Election in Malaysia to make sure Barisan Nasional win the election and rule again. Once Barisan Nasional rule then MCA, Gerakan and SUPP can implement stupid and animal laws in Malaysia because they are uneducated. They just know how to rape ladies, bluff Malaysian people, abuse of power, evil, cruel, wrong doing, steal people ideas, create confusion, they themselves have done wrong doing but pin pointing other for wrong doing, create defamation, corruption, force people to sell their land cheaply to them, seize people business, get government licences, get government projects, get the sultan birthday awards self-interest, caring for their cronies, neglect people of Malaysia, neglect the country etc. I asked all Malaysian to join hand together to bankrupt all MCA, Gerakan and SUPP leaders as a revenge. That’s why Bankruptcy Act 1967 was being amended in March 2017 to become Amendment Bankruptcy Act 2017. the new Amendment Bankruptcy Act allow a person who hold a OKU Card registered with Jabatan Kebajikan Masyarakat can be discharged from bankruptcy. OKU person such as heart attack, physical handicap, mad, kidney failure, paralyse, stroke etc cannot work to pay off the debt to banks or chetty. A person is dead can be discharged of bankruptcy. After 3 years of bankruptcy that person can be automatically discharged from bankruptcy. Within the period of 3 years as a lesson to the bankruptcy person to be careful next time. Government must give a person a second or third chance to stand up again for survival. Within the period of 3 years that person suffer a lot that is cannot do anything and cannot apply for anything. The present world with university education many young people under the age of 30 years can hold high executive post with a high salary can apply for Credit Card. These young people lack of experience and knowledge to handle money therefore they over spend their money which resulted in bankruptcy. Some bankruptcy people because business failure and cannot pay back business loan or personal loan to the bank. Some bankruptcy people house on fire or land on fire cannot pay back loan to the banks. Some people money being cheated by people and cannot pay back loan to the banks and were declared bankruptcy by the court. Some bankruptcy people money in the house or shop being stolen and cannot afford to pay back the bank loan. To increase maximum RM 30,000.00 to RM 50,000.00 is a must because of the devaluation of Malaysian money and money become smaller and smaller. I am an OKU Card Holder with Jabatan Kebajikan Masyarakat Melaka and I owe RM 32,000.00 to bank by now. Will I be declared bankruptcy with the implementation of the New Amendment Bankruptcy Act 2017. Can I submit my photostat OKU Card to Jabatan Insolvency or court that I am an OKU Card Holder. If an OKU already declared bankrupt and how to apply for the discharge of bankruptcy. That person with an OKU Card can show to Jabatan Insolvensi to discharged the bankruptcy status.

      • Paul OConnor 13 September, 2022 / 10:39 am

        You should paragraph your comment so people can read and understand it

  2. Ngoi Eng Aun 23 November, 2016 / 10:16 am

    The new Insolvency Act must provide for automatic discharge after being a bankrupt for a certain period of time. The social stigma of a bankrupt and the “punishment” during the period of adjudication of bankruptcy and point of discharge are sufficient deterrent and or punishment on the person being made a bankrupt

    • Seller 23 November, 2016 / 12:35 pm

      Yeah right. If I cheat you, never paid for your goods of a few million, I still be auto discharged after a few years. This will raise cost of doing business, and seller have to raise price to cover the risk and losses.

      Or require collaterals which will crimp the economy. Also no foreigner dare doing business on credit, all cod.

    • Justin Jong 23 November, 2016 / 5:53 pm

      I don’t entirely agree with auto discharge. Many will surely take advantage on this and intentionally borrow money and do noting about it. Everyone who borrow any Sim of money should be reponsible for it and bear the consequences until he / she fully settle the debt. No loop hole should be even there for anyone to think of.

  3. Ganasen a/l marimuthu 23 November, 2016 / 11:13 am

    Cara cara bayaran ???

  4. Nathan 23 November, 2016 / 12:18 pm

    What if I’m alreadydeclared bankrupt , for amount below 50k , this happened on march 2016

    • Justin Jong 23 November, 2016 / 5:57 pm

      Bro, nth will happen until you settle the POD amount in full.

      Why am I saying so, remember when amount for Bankrupt was used to be Rm10k, those who was adjudicated as a bankrupt is still a bankrupt now until they fulfill the requirement by discharging themselves or was issue a certificates of discharge by Ketua insolvency.

      So.. pay the debt. Negotiate with creditor for a lower amount is the best way

  5. Charles 23 November, 2016 / 12:23 pm

    Has this Bill been tabled or planned, there is no media coverage on this bill at all?

  6. Sivakumar 23 November, 2016 / 12:47 pm

    How long it takes new Bankruptcy act to be effective from the time it was tabled in Parliament for its First Reading. Can anyone please help comment on this THANKS

    • Justin Jong 23 November, 2016 / 5:59 pm

      Good question. I think so far no one can predict the actual date. The 50k deal have been talking for the longest time.

      • chewapqY.L. Chew 27 February, 2017 / 7:34 am

        50K is nothing now. Banks can just whack up charges easily into 20K – 30K with their so-called efforts to recover as well as interests.
        There should be rules to allow what is substantiated bills that can be accepted into the totalled 50K rather than anything the creditor can submit. Judges normally do not question what is billed by banks and banks can’t produce the bill citing old documents goes to vault or lawyer etc.

  7. KT Tan 23 November, 2016 / 2:38 pm

    Do this new rule overspede the old rules? Can the insolvency help to reduced the amount for people to make easy instalments to pay ?

    • Shahrir 8 December, 2016 / 5:28 am

      Not retrospective

  8. anand 23 November, 2016 / 4:34 pm

    if I’m blacklisted can the government ask me to pay the income tax?

    • Charles 24 November, 2016 / 9:55 am

      one things for sure dead and taxes.

    • Shahrir 8 December, 2016 / 5:34 am

      Based on the present bkcy act you are still subject to lhdn & epf (owing to the gov) claim even if you are discharged from bkcy, unlike claim under contract.

  9. Pooi Yee Chong 23 November, 2016 / 7:32 pm

    my relative was a guarantor, declared bankrupt in the 90s, even now the debtor has passed away. Can he apply for discharge?

    • Gemini 26 February, 2017 / 7:00 pm

      You may apply for discharge provided you have showed good conduct. I know of someone who has recently been discharged, also a guarantor. It’s all about your conduct, if you pay your monthly installments you have almost a 100% of discharge by the DGI. My friend was discharged under Act 33A of the bankruptcy Act in Jan 2017

  10. Norzihan Zainudin 23 November, 2016 / 11:09 pm

    I was declared bankrupt in 2012.
    I was a victim of landslide.My business was badly affected and I am at lost.
    But they are still charging me to pay the balance of loan taken from a government sector.
    What do I do?

    • Shahrir 8 December, 2016 / 5:39 am

      Please refer to the insolvency dept /office nearby .

    • Yura 10 March, 2017 / 1:47 pm

      Once you have been declared a bankrupt, no creditors can ask you to pay the balance of your loan. If they still insist you to pay the loan, please report this matter to Insolvency Dept.

  11. Leemeiling 23 November, 2016 / 11:16 pm

    If a person under bankruptcy in the yrs of 2011 and still instalment paying can he/she going outing from malaysia or it can automatic discharge.

    • Gemini 26 February, 2017 / 11:17 pm

      You may apply to insolvency for permission to travel. New law is $500 per country estate money you pay. Permission to travel is $500 per country per year. Meaning you may go in/out for 1 year once approved.

  12. Deborah Lim 24 November, 2016 / 12:36 am

    By raising the threshold from rm 30,000 to rm 50,000, this will only spur people to continue spending.
    Even a discharge through serious disease…yes I will get a doctor to do so.
    Loopholes for people to get away.
    Borrowed monies must be returned.
    No money dont spend/splurge

    • Charles 24 November, 2016 / 9:58 am

      There is credit rating system implemented for all individuals. Even if you are discharged, your rating remains bad. Let the onus be on the financial institutions before they lend out any loans to individuals.

      • Gemini 26 February, 2017 / 11:20 pm

        May I correct you in this matter. Yes, once you are discharged you are adviced to clear your blacklist with CTOS, the record will stay in their system for 2 years from the date of discharged only. It will be erased automatically once the date laps.

  13. B.O.Tan 24 November, 2016 / 8:20 am

    Tricky person will uses other people names to get loan or do business easily by promising them that they will get paid every month. By endorsing such new changes of bankruptcy rules, many more desperate people will volunteer their names to be used to do biz or get loans as they are no more worry abt being a bankruptcy as auto discharge will be implemented. Market will be getting more bankrupt people in and out fr the records.

  14. James 24 November, 2016 / 8:48 am

    Is there any law to withdraw EPF fund to settle bankrupt amount.

    • Charles 24 November, 2016 / 9:59 am

      If you are above 55, yes can withdraw and settle the loan.

      • Mat Cendana 1 March, 2017 / 10:27 pm

        A contributor can already withdraw one-third upon the age of 50.

  15. jimi F 24 November, 2016 / 10:40 am

    It’s being 21yrs/ since 1995 I’m a bc, my property was action not enough to cover my credit card bill n interest ? NEED all your advise is there any possibility for auto discharge.. .I do pay instalment to insovercy office but stop for nearly 7yrs income not stable… At moment I’m 53yrs old… THINK of working oversea to earn more, plssss help . Appreciate very much. Tks JF

    • felix godfrey 26 November, 2016 / 6:37 pm

      1995 till now already 21 yes; in fact, under current bankruptcy law after 5yrs can apply to DGI of your state jabatan insolvensi for discharge, if rejected, can reapply after 7yrs, provided you can prove that you have conducted yourself accordingly

      • Jimi F 27 March, 2017 / 4:47 pm

        Many thanks for your advice, I did send in my application on 33A (Nov 2016) I was told by insolvency office (early Feb 2017 ) is in process they have forwarded the case (consent given by their superior) to DGI-Hq waiting reply…appreciate may i know how long it take to process for the discharge, is coming to 5 months already I did call up they said on Q. Plsssss need your help.

    • Gemini 26 February, 2017 / 11:24 pm

      Go seek advice from your insolvency officer handling your case. Get him to help discharge under bankruptcy act 33A. It’s free of charge.

    • Jimi F 27 February, 2017 / 2:00 pm

      Many thanks for your advice, I did send in my application on 33A (Nov 2016) I was told by insolvency office (early Feb 2017 ) is in process they have forwarded the case (consent given by their superior) to DGI-Hq waiting reply…appreciate may i know normally how long it take to get discharge. Thanks

  16. Chand 24 November, 2016 / 12:54 pm

    What in the case where you had already been a bankrupt about 7/8 years ago but still been served by Insolvency Dept.yet.

  17. Stan 24 November, 2016 / 1:17 pm

    I have been declared BC since 2005. Cause by relative promised. Now I have to suffer for silly act I did back then. Can’t they discharge those who have been BC for more than 10years. ????

    For sure the amount now is lower than 50k. If it apply it would be great!!

  18. Sheyln 24 November, 2016 / 11:14 pm

    I have epf case, company issue. How to solve this matter.. I can’t get any advice till lawyer letter given.

  19. Nasha C 25 November, 2016 / 10:52 am

    I have been paying Insolvensi Dept since year 2007, being a guarantor and friend using my name as Company director, I can’t afford to negotiate with debtors and pay them, and its buta case for me to pay them.

    Im stuck with all my personal life, no asset under my name. And I’m chinese muslim converted and filing for divorce soon.

    Any advise how to appeal for clearing my name from bankruptcy?

    • Charles 1 December, 2016 / 3:37 pm

      Wait for the bill to come effect in 2017, then God willing its auto discharge for all.

    • Gemini 26 February, 2017 / 11:28 pm

      You cannot divorce while you are still bankrupt especially if your spouse has assets. Divorce is 50/50 distribution & insolvency will take your half! You must first sort out your discharge before divorce or transfer all assets out from your spouse first.

  20. Koh 25 November, 2016 / 2:37 pm

    Where could we find the exact amount of debt? Met some officer years ago, been told they will investigate the amount but no news ever since. Kept calling, but no answer or no follow up. Only opened an account and been paying minimal for a few years. How does the auto discharge work? Where is the best place to find information?

    • Charles 1 December, 2016 / 3:35 pm

      you need to wait until the bill goes for 2nd reading in March 2017. After that, it goes to Dewan Negara and becomes law of the land 30 days later.

    • Gemini 26 February, 2017 / 11:30 pm

      Insolvency will have a copy of the proof of debts filed with them. Go and see them, you need to apply for the documents & they will oblige by giving you a photocopy.

  21. nic 3 December, 2016 / 1:43 am

    What can i say? Malaysia is totally sucks when comes to money management

  22. Maria 9 December, 2016 / 10:19 am

    1. I was forced to be a guarantor for a car being refinanced by the owner. At that time the amount from 3k shot up to 9k in interest n auto CCRIS.
    2. My late husband purchased a car under my name..instalment defaulted n I m now in black list. At t time of purchased back in 2001 was 27k. With Interest all in shot to 33k maybe even more now..
    In n out of court.. There’s a funny rule in court …mengaku atau tidak . Where you hv no one to legally defend you.. What choice are we left with if not to admit mengaku auto subject to guilty as charged..

    I m still a single parent and in total dilemma what more with two college going children n high expenditure n non regular income.

    Tormented till today..the thirst to release my name from the above is already half killing.

    Any good n detailed advise please.

    Thank you.

    • Gemini 26 February, 2017 / 11:33 pm

      Your amount owing is not much. Go see the officer in charge of your file. Seek their help to arrange a meeting with your creditors. A starting point of negotiations is 10 cents to a dollar settlement is possible.

  23. thamodharan 10 December, 2016 / 11:17 am

    What is the difference between Financial Inst/ Bank taking judgement against debtor and declared BC? My uncle suffered big losses in his biz during 1998/99 recession where his vehicle repossed. He wasn’t able to apply any loans after the economy got better as BNM official said due to judgement been taken on his name. Dealing with transport biz…total 8 lorries and 3 cars were reposed and he have been paying for all till now? Heard from some bankers JT is also BC, couldn’t figure out if true or false but the impact and scuritiny for debtors seem the same. Just curious to know if uncle could find a way out after literally suffered more than 13years…plz advise

  24. Raassoc 19 December, 2016 / 9:20 pm

    The minister has been reported to say that 60 yr plus bankrupt can be discharged after a discharge period.but I read the amendment bill there is no mention. Pls adv

  25. Mark L 3 February, 2017 / 12:05 am

    I was declared BC in 2012. I wasnt around KL much working overseas most of the time. I did not know until my credit cards were withdrawn.

    It was for a personal guarantee of a lease agreement for shopping mall lots. The lease was for 3 years but business only carried out for 1 year. Did not owe any rental but i think there charge for balance of tenure. Amt up to RM600k. Monthly rental only RM15k….I still do not know how it ended up to this figure.

    Is there a clause if i was not a resident in Msia during the period of serving this BC charge, i might be wrongly charged because i was not here to defend the case….

    Any one please advise……i am totally lost….

  26. Mark L 3 February, 2017 / 12:54 am

    Dear All

    Can the BC amount be contested because i wasnt around the creditors serve the BC claim.

    Please advise

    • Gemini 26 February, 2017 / 11:43 pm

      First of all, you need to get the proof of debts from insolvency. You have to start somewhere, with the help of insolvency you arrange for a meeting with your creditors. Out of your total amount hoe much is capital owe & how much is interest. Get the creditors to know out all the interest & negotiate in principle amount owed. Since your case is only 5 years the debtors might not agree to anything less than 50%. Yet again, it’s your negotiation power it can be lower. I know of people paying only 10% of amount owed & get discharged.

  27. michael 17 February, 2017 / 12:23 pm

    What about a person who has already been a bankrupt for more than 5 years. does automatic discharge applies?

    • Gemini 26 February, 2017 / 11:48 pm

      The term ” automatic discharge ” does not mean you get scot free juz like that.
      You still need to tick the boxes, you need to pay your monthly installments promptly and then seek they help from the officer in charge of your file to “apply” for discharge. Insolvency will write to your creditors informing them if they have objections to your discharge giving 21 days for feed back. If no objections comes in after the date laps you will be discharged within 1 month.

  28. PALAN 23 February, 2017 / 3:17 pm

    I have a friend who has been bankrupt since 2013. He stood a guarantor for a friend of his for a hire purchase agreement (car). Well, his friend failed to pay and the creditor exhausted all avenue to recover the loan. They filed bankruptcy and my friend became the victim (since 2013).

    Under the new law, will my friend get auto-discharge ?? I believe he falls under social guarantor?Since the new amendments reads as below:

    (6) Social Guarantor: No Bankruptcy

    A social guarantor is a person who does not profit and essentially provides a guarantee for an education loan, hire-purchase transaction for personal or non-business use, or a housing loan for personal dwelling.

    The present Bankruptcy Act 1967 allows for bankruptcy proceedings against a social guarantor if the creditor had exhausted all avenues to recover from the debtor.

    The law will change where there will now be an absolute prohibition in commencing any bankruptcy action against a social guarantor.

    • Gemini 26 February, 2017 / 11:52 pm

      Fact of the matter is your friend was bankrupt before the new law enforced. For his case, he still need to tick the boxes. Seek help from insolvency to write to the creditors informing them of discharging you giving them 21 days for feedback. Once laps with no feedback insolvency will discharge you accordingly.

  29. Sumathi Retnasamy 27 February, 2017 / 12:44 pm

    When will this new law take effect?

  30. kenny chan 27 February, 2017 / 4:38 pm

    my father was BC since 6 to 7 years ago and he have high blood pressure and being operation for coronary heard disease. can we apply to take him overseas for holiday and i know he didnt pay anything to BC office. plz advise.

  31. Emily 27 February, 2017 / 9:39 pm

    My father was long retired, healthy, no income, no property and declared BC in 2015 at age 78. He sold his company in 1991 and the new owner did not remove his name as a Director. The company did not pay KWSP contribution since 1993 and closed down in 1994. In 2015, my father bank account was freeze and was informed by the bank about his BC status. The amount owe to KWSP is abt 400k incl interest. I have been helping my dad to pay minimal installment to insolvency for 1.5 yr. Officer advise to pay up to 5 yrs and appeal for discharge then.
    Any chances my father case can get auto discharge sooner?

  32. Jo-anne 28 February, 2017 / 9:10 am

    I know a person who loan money from local bank and do business in oversea. After he got all his paper work done to get citizenship oversea, he just ignore his repayment here. He is now declared bankrupt but in Malaysia. Will he still have to repay the money here? Or what is the action taking on him?

  33. John Ng 28 February, 2017 / 11:13 am

    How does a BC settle his debts if he has no fixed or consistent income since 2013? All his daily expenses are being taken care of by siblings and he can’t get a job that pays as promised. Did a few odd jobs but ended up being paid half or sometimes nothing and have no energy to argue.

  34. Raman 28 February, 2017 / 11:28 am

    When will the 2nd and 3rd reading of the ammendments to the bankruptcy act take place and when will the law come into effect.

  35. segaran 1 March, 2017 / 1:43 am

    i had been participate in akpk program for 10 years repayment since jan 2009 and due to my parent sickness i had withdraw from akpk program since august 2016 untill now not paying, and did receiving many call and lawyer letter for payment. in this case should i declare bankruptcy or wait for creditor come to me? if i declare bankruptcy, any document need to prepare?

    thank you.

  36. Zaidi 1 March, 2017 / 9:41 am

    BC since 2014. I’am not a Sosial Guarantor but I only held 1% share in the company and was given RM400 a year as a Hari Raya bonus. After Auto Discharge I still have to pay to the creditor right?

  37. KY 10 March, 2017 / 11:56 am

    whether the insolvency act has come into forced? when is the effective date?

    • Jry 20 March, 2017 / 12:10 pm

      no confirmed date yet as it is still in the first reading. Might need to wait for another few years for the ACt to come into effect.

      • Raassoc 20 March, 2017 / 9:06 pm

        The second reading is anyday during the current march session then if approved will go to dewan negara in april. Hopefully they will gazzette by mid year

  38. prabhakaran 24 March, 2017 / 3:46 pm

    How to clear Bankruptcy?

  39. John Ong 1 April, 2017 / 12:04 am

    I became a bankruptcy since 2004 amounting to Rm 2 million over, then i paid installation Rm 100.00 a month until 2014. Then economic starting going down ward so i didn’t pay the installment till now. Because i have 4 children to feed, How can i apply for discharge my bankruptcy ? Please advise. Thank you

    • Rani Nadesan 3 April, 2017 / 4:17 pm

      We have to wait for the Amended Act to be gazetted. If it applies retrospective, you can apply to the DGI office. The Amended Act requires one to declare the Statement of Affairs and Accounts to the DGI, in order to qualify for the 3 year automatic release from being a Bankrupt.

      • John Ong 4 April, 2017 / 9:09 pm

        Regardless of how much the amount of debt?

    • Martha 29 May, 2017 / 2:05 pm

      hi, both my sister and brother are bankruptcy since 2007 amounting to 100k, they paid min amount of RM50 for less than a year as he’s the sole provider for his huge family of 5 children all below the age of 9. its been 10 years and their names are still in the system. How can they appeal for Bankruptcy discharge? Anyone with experience and advice on how to go about with this.

  40. Hurley 12 April, 2017 / 6:43 pm

    I have a friend who is been declared BC. Can he open a bank account using his name. He is operating a small business using his brother name. Can he open a nusiness ysing his name and opening bamk account under his name. For infor his outstanding BC amount RM80k.

  41. Rikko Swee 29 April, 2017 / 1:55 am

    I am 60 years old man, still struggling for surviving in foreign land. When my passport was about to expire on April 2015, I went to the Embassy to renew. I was informed by the embassy staff; the bank has declared me on the Bankruptcy List.

    In year 1998, we had 3 partnerships business. I was acting as a sleeping partner and the 2 was active running the business. Somehow these 2 active partners had theirs own disputed and left, one after the other. I had no choice but to step in to run the business. When I realized both partnerships had fully utilized the bank loan and account running low. I poured in more personal fund to the keep the business running. Hopefully I can be able to turn over, and to recover for the loan. Unfortunately it was a depression years for country and suffered greatly lost. Eventually I had to close it down; trying in vain to contact both partnerships to requested them to pay back the bank loan, failed. After using my personal loan to support the business, I turn into broke as well; I had to find an alternative to survive myself. I have to leave the country for surviving; if I stay back I will be in bad shape being Bankruptcy candidate can’t move on my life. I will become homeless and begging on the street.

    Recently I was being updated the recent Bankruptcy Act were give us a forgiveness. Please advice, how can I be able to pursuant? I am still living and earning on the foreign land. Should I have to engage a lawyer to file my petition?

  42. nevin low 2 May, 2017 / 10:35 pm

    Under the new Insolvency Act 1967, I am a social guarantor for a Hire Purchase car loan to someone not related to me. And the amount was RM100k. I was made a bankrupt in 2013 without an official notice served on me. Nevertheless, I was made a bankrupt. Am I eligible for a discharge? under the new Insolvency Act 1967- Social Guarantor.

  43. Pooh Key Mark 19 May, 2017 / 11:18 pm

    Lucid article, thanks.

    Will you be authoring a book on Insolvency laws in malaysia in light of the amendments any time soon?


  44. Yap Peng Thien 25 May, 2017 / 3:15 pm

    Being a bankrupt is like staying behind bars. I was declared a bankrupt in 1995 which restricted / limited any chances of personal growth or career advancement. Automated discharge is a misconception that has landed myself in grievance pastures for 20 years. I was finally discharged last November 2016. But that is not freedom totally as records are somewhat unable to erase from your record. As such, many information you have acquired about being a bankrupt free you from financial responsibility is a misconception. You will lead a miserable life or better phase has no life. So be prudent with your finances and manage them with extreme care

  45. Maggie 31 May, 2017 / 11:49 pm

    I owed credit cards RM50k after my hubby left the family. I have closed my company and for past 6 montgs has got a job. How do I make arrangement to pay my debts? What choices do I have? Will I still be allowed to travel if I am on ccris or ctos? I wish to also wind up my company which is not operational now but have not enough money to even pay for the accounting fees… pls advise

  46. Khor 14 June, 2017 / 11:39 pm

    I would like to ask
    If the house under two owner, but the one of owner dun want make a house loan payment, how the others owner suit do to safe himself from bankruptcy?
    Because is unfair for the one who keep paying the loan but the end get effect for bankruptcy

  47. Koo 3 July, 2017 / 9:05 pm

    How do we know the new act will be gazetted?
    Once gazetted, is it auto discharged after three years? Thanks

  48. Abd. Nasir Bin Osman 23 July, 2017 / 5:51 am


  49. Abd. Nasir Bin Osman 23 July, 2017 / 6:05 am


  50. Abd. Nasir Bin Osman 23 July, 2017 / 6:05 am


  51. Jason GBRL 18 September, 2017 / 1:24 pm

    I was declared a Bankrupt in 2010, and it has been more than 6 years I have been a bankrupt. Though my guarantor has settle the full amount with the bank that made me bankrupt, the Jabatan Insolvency says, I have to settle all the other debts with other banks before can get a discharge. I am already 56 year old now and struggling with finances. With what I have I cannot settle what I am owing other banks. Can I get a discharge after I retire?

  52. gun 28 September, 2017 / 3:50 am

    is doing a bankruptcy status check at the Insolvency department’s official portal safe? and will it trigger or red flag anything by trying to do this check?

  53. RacO 9 October, 2017 / 3:37 pm

    Would like to know roughly how long is the court proceeding if wish to sue someone for bankruptcy, taking into consideration the 90 days interim order pursuant to the new law.

  54. Thirul 14 June, 2018 / 4:19 pm

    Good day,

    I have been declared bankruptcy in 2012. I am an oku card holder.. can I clear my bankruptcy status.

  55. Dickson Cheng 25 August, 2018 / 11:29 am

    I has been charge to bankcrupcy as a garantor on business related. This case was over 30 years. May I know how to check for status

  56. Anna 27 December, 2018 / 9:42 am

    My husband about to be declare bankruptcy and the same time he want divorce me because i just found out his affairs. Would his debts affected me ?

  57. Harry 8 January, 2019 / 12:18 pm

    Hi Gemini, really appreciate all the advice on forum. I need some advise, I have been declared a bankcrupt for about 4 years whilst I’ve been working overseas. I returned and did negotiate with the banks regarding the bankruptcy case as it was a car loan case whereby the got the car back sold it for a song and decided to hang me. But for some reason I have been allowed to travel, I think it’s because they got the wrong ic number. I have wrote to the banks and ask them for a lower amount but they don’t reply. Insolvency Kuching was handling my case and I called the for a meeting with the banks lawyers and nothing happened. So I just left it. I have withdrawn my 1/3 epf last year turning 50 and kept it in my mums account. I’m currently working overseas and got a job offer back home , what do I do? Thanks so much for your kind advice, please help.

  58. Michael 12 April, 2019 / 1:38 pm

    Can a bankrupt withdraw his/her EPF upon reaching 55 years old and will the creditors confiscate the EPF amount? And how can the bankrupt deposit the cheque from EPF if he/she does not have a bank account as all the bank accounts would have been frozen?

  59. Joyce 27 September, 2019 / 10:00 am

    My Bro was declare a bankrupt early this year, and he is all the time working in oversea. Recently he has obtain citizenship from the country and if he want to transfer fund to my dad account in Malaysia will it be any issue? Will the bank find out and block/hold the funds? Need your advice. Millions thanks..

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