INSOLVENCY ACT 1967
MIRI: Most members of the public here welcome the decision by the federal government to table an amendment to the Insolvency Act 1967 in the current Dewan Rakyat meeting.
Minister in the Prime Minister’s Department (Parliament and Law) Datuk Takiyuddin Hassan revealed the federal government’s plan during Oral Question Time in Dewan Rakyat last Tuesday.
He said the government was concerned about bankruptcy, especially post Covid-19.
“We will table an amendment, specifically Section 5 (1) of the Insolvency Act which involves a new (bankruptcy) threshold,” he added.
Takiyuddin was answering a supplementary question by Hannah Yeoh (DAP-Segamat) on whether the government would increase the bankruptcy threshold in light of the Covid-19 pandemic.
The bankruptcy threshold was last raised from RM30,000 to RM50,000 in a 2017 amendment.
IQBAL ABDOLLAH, Civil servant
‘in view of the Covid-19 crisis, an amendment to the Insolvency Act 1967 (Act 360) is timely, particularly the Sub-Section 5(5) of the Act, in which paragraph 5 (1) (a) states the creditor is not eligible to file for a bankruptcy petition against a debtor, unless the total indebtedness is worth RM 50,000 (amended 2017).
‘Amendment to this paragraph has been made five times since 1967, namely in 1967 (RM1,000); 1976 (RM2,000); 1992 (RM10,000); 2003 (RM30,000) and 2007 (RM50,000).
‘Now, after more than 13 years, a change needs to be made to ensure the survival of creditors and debtors without ignoring the global economic crisis and the Covid-19 epidemic.
‘The amendment also has to look at the benchmark set by the OECD (Organisation for Economic Co-operation and Development) and study whether the bankruptcy will convince foreign investors to invest in Malaysia.
‘I believe it is necessary to increase the minimum value of bankruptcy under Section 5 of the Insolvency Act 1967 as the last review was made 13 years ago. Maybe an increase of 150% to 200% (RM75,000 — RM 100,000) is necessary.
ANDY JONG, Northern Sarawak Journalists Association (NSJA) president
‘The amendment will certainly help those badly affected by the Covid-19 crisis. Many lost their jobs and were unable to pay for their bills (especially car and housing loans).
‘Those who still have their jobs should not stop paying for their loans. They should make regular payments to avoid being listed as bankrupts.’
PETER HEE, Deputy chief of Democratic Action Party (DAP) Sarawak Youth
‘The amendment to the Insolvency Act 1967 will not only help individuals but also those involved in retail sector. The period of Covid-19 pandemic since March this year proves to be exceptionally difficult for those struggling in the retail businesses.
‘Filing for bankruptcy is a scary thing to most people. People’s lives are disrupted when they file for bankruptcy. It is generally viewed as a last resort for those with serious debts. Hence, I believe the amendment will lessen the people’s burden.’
SULAIMAN OSMAN, Government pensioner
‘Going bankrupt is definitely a serious matter. The federal government’s plan to amend the Insolvency Act 1967 is a relief to those badly affected by the Covid-19 pandemic. Many people have lost their jobs and cannot repay their loans. Covid-19 has not only impacted individuals but also the retail sectors.’
ISMAWATY ABDULLAH, Food seller
‘The proposed amendment is a huge relief to us. We have to arrange special rent payment plans with our landlords. Because of the Covid-19 pandemic, some people are heavily in debt.
‘The amendment to the Insolvency Act 1967 will help those badly affected by the pandemic. We are all struggling to make ends meet.’
WIVY KATHYNA IBRAHIM, Private sector employee
‘After more than 13 years, it is about time for the government to amend the Insolvency Act 1967. It will help not only traders but also individuals post Covid-19. Many people are struggling to survive and struggling to pay their loans and utility bills.’