Kuala Lumpur: Malaysia has adopted the United Nations Commission on International Trade Law (UNCITRAL) Model Law on Cross-Border Insolvency, marking a significant step towards aligning the nation's insolvency framework with global best practices. Minister in the Prime Minister's Department (Law and Institutional Reform) Datuk Seri Azalina Othman Said announced the initiative, emphasizing its role in providing a clear, predictable, and fair process for handling insolvency cases involving multiple jurisdictions.
According to BERNAMA News Agency, Azalina stated that the adoption of the UNCITRAL Model Law demonstrates Malaysia's commitment to legal innovation and economic governance, shaping the country's economic and legal landscape for years to come. She highlighted how the Model Law will improve legal certainty, enhance global cooperation, and protect creditor rights, thereby boosting investor confidence and showcasing Malaysia's dedication to fair, transparent, and efficient insolvency resolutions.
Azalina stressed the importance of a strong, transparent, and predictable insolvency system, which benefits businesses, creditors, investors, and the economy as a whole. However, she noted that legal reform alone is insufficient without effective collaboration among key stakeholders. 'We need collaboration between the government, legal experts, financial institutions, and industry players to ensure this system works,' she remarked.
To ensure smooth and effective implementation, Azalina also announced the establishment of two key committees. The Cross-Border Insolvency Reform Main Committee will be responsible for setting policies and ensuring that Malaysia's legal framework supports business and economic priorities. Meanwhile, the Cross-Border Insolvency Reform Working Committee will be led by the Legal Affairs Division (BHEUU) of the Prime Minister's Department, comprising 20 key agencies and focusing on developing practical policies to integrate the Model Law into Malaysia's legal system.
Azalina emphasized that with the guidance of these committees, Malaysia's insolvency framework will become stronger, more efficient, and internationally respected. By adopting this Model Law, Malaysia aims to ensure the protection of creditors and stakeholders, foster an environment that inspires confidence, facilitate seamless international trade, and attract global investment.
In conjunction with Malaysia's ASEAN Chairmanship, Azalina highlighted the government's leadership role in promoting regional legal cooperation to strengthen the ASEAN economic ecosystem. She announced that the upcoming ASEAN Law Forum 2025 will serve as a platform for legal experts, policymakers, and industry leaders from ASEAN member states and dialogue partners to discuss the harmonisation of insolvency laws across the region. 'A unified approach will make cross-border business easier, attract investors, and create a more stable financial environment,' she added.
The inaugural Malaysia Cross-Border Insolvency Conference 2025, themed 'Navigating Cross-Border Insolvency: Challenges and Prospects for Malaysia', was organised by the Malaysian Department of Insolvency (MDI) in collaboration with Insolvency Practitioners of Malaysia (IPAM), the Companies Commission of Malaysia (SSM), and the Malaysian Institute of Accountants (MIA). The conference drew nearly 500 participants, including legal practitioners, economists, financial experts, academics, university students, and representatives from the public sector.