procedures based on international
principles of good practice, as
contained in the World Bank’s Unified
Creditor Rights and Insolvency
Standard. The new law should
also accommodate prenegotiated
agreements prescribed by regulations.
secured transactions and insolvency
laws and related procedures.
Court System. With regard to Kuwait’s
court system, the report concluded
that an active, properly funded
and administered judicial training
program is needed to strengthen
judicial capacity. Market participants
currently express ambivalence
toward the country’s judicial system,
pointing to an insufficiently clear
development of economic law to
ensure reliable commercial activities.
In addition, the report recommended
promoting judicial specialization in
commercial and insolvency matters by
ensuring that judges on the commercial
circuits should not be transferred to
non-commercial courts before having
served on a commercial bench for at
least three years and preferably five.
This would enable judges to acquire
insight and expertise as specialists
in commercial transactions.
The report recommended establishing
a suitable comprehensive insolvency
regulatory framework and oversight
body entrusted with responsibility for
regulating and supervising insolvency
practitioners. The body would enforce
minimum standards of knowledge,
skills, and conduct for practitioners,
and prescribe requisite criteria for
the training, licensing, monitoring,
and disciplining of practitioners.
Kuwait should also consider establishing
uniform court rules and case practice
and management regulations to
augment the insolvency, commercial,
and procedural laws and to streamline
proceedings, in court and out. For
routine matters, such rules and
regulations could be complemented by
standardized forms and procedures.
Credit Risk Management Systems. The
World Bank report also suggested that
Kuwait consider adopting a generally
applicable regulation to support both
informal and quasi-formal restructurings
for financially distressed companies.
The report surmised that the provision
of additional and greater specialized
training for commercial and insolvency
law judges should yield more efficient
administration of insolvency cases.
The report recommended that Kuwait
institute a regular internal training
program, which would include
training on economic and financial
concepts. Such training could be
complemented by providing internal
bench handbooks that explain the new
The Commercial Law makes reference to
the profession of bankruptcy managers,
but in practice there is no formal body
that regulates or supervises insolvency
practitioners in Kuwait. Although
no formal qualification is necessary,
most insolvency administrators
are lawyers or accountants.
continued on page 26
“Operational challenges had led to some
short-term losses, and we needed working
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senior management from us and was an asset
based lender thinking like a cash-flow lender.
We needed a true asset based lender. And,
we needed to know their senior management
was in our camp. AloStar got into the nuts
and bolts of our plan. They believed in it.
And that made the difference. Being able to
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CHIEF EXECUTIVE OFFICER
ROCKFORD PRODUCTS, LLC