A critical assessment of administration as a rescue mechanism of an insolvent corporate debtor in Uganda

Abstract

Insolvency law enhances growth and alleviates financial challenges of businesses, but it can also be inefficient and delay commercial justice. This article critically evaluated Uganda's insolvent corporate debtor administration method and impacts. At the end, the article call for the bankruptcy protective order duration to be extended to at least a month in order to allow a debtor to establish payment arrangements. This period may be sufficient for the bankrupt to decide on the next steps to take to clear their debts, compared to the 14 days allowed under present insolvency law. Without increasing this term, the temporary protection order will fail since the bankrupt will still be panicked and may sell his/her business property at a loss. It is also recommended by the study for legal training to be organized for insolvency practitioners. This will ensure that only trained insolvency practitioners can practice. Finally, there is urgent need for enhanced insolvency law. Keywords: Insolvency, Administration, Corporate debtor, Creditor, Insolvency practitioners