Common Provisions between Preventive Measures and Bankruptcy Declaration in Kuwaiti Law (71/2020): A Comparative Study with Islamic Jurisprudence

Abstract

Objectives: This study examines the key provisions common to preventive measures against bankruptcy (preventive settlement and restructuring) and the declaration of bankruptcy in the Kuwaiti Bankruptcy Law (71/2020), comparing them with Islamic jurisprudence. Such is particularly relevant as many of these provisions received no treatment in the repealed articles (555-800) of the Commercial Law (68/80) or other Arab legislations, such as the Egyptian Law of Protective Reconciliation and Restructuring and Bankruptcy Declaration (11/2018). Methodology: This study employs three methodologies: an inductive approach to collecting legal and jurisprudential material, a deductive approach to the provisions under investigation, and a comparative approach to these provisions and Islamic jurisprudence. Findings: The study concludes that many of the shared provisions in the law are consistent with Islamic jurisprudence, while others differ. The application of these provisions may vary depending on the debtor's situation, whether they are bankrupt with debts exceeding assets or facing financial difficulties without entering bankruptcy. Originality: This study is the first jurisprudential analysis of the shared provisions between bankruptcy and its preventive measures in Kuwaiti Bankruptcy Law. The study includes several recommendations for aligning the provisions of this law with Islamic jurisprudence.