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Ministry of the Economy calls for approval of bankruptcy law

SD. The Ministry of Economy, Planning and Development (MEPyD) expressed its hope that the National Congress will approve the legislative proposal for the Law of Restructuring and Liquidation of Companies and Individuals or Corporations before 31 May.

The initiative seeks to protect employees, who before were helpless when a company declared bankruptcy, and many lost even their severance pay and other benefits together with the creditors of the companies in question and, furthermore, to help achieve the operational continuity of these companies.

During a press conference held yesterday in the B Block of the Governmental Offices, the MEPyD Deputy Minister, Juan Reyes, who is in charge of the Management of National Competitiveness, said that May would be an adequate date to convert the proposal into law since it was already approved in a first reading by the Senate last 15 April.

He recalled that 31 May is when time expires for the country to be taken into account in the new report of Doing Business rankings of the World Bank, and would improve the country’s position regarding the business climate and at the same time help to increase foreign investment.

He said that the Dominican Republic currently occupies position 158 among 189 countries, in the indicator of the resolution of Insolvency in the Doing Business report of 2015, because it does not have a bankruptcy law.

The official said that if the country manages to get a bankruptcy law it will significantly improve its business climate, and could attract more foreign investment.

“The investments go to the countries who are more competitive, and what is the most competitive country today? It is Singapore, who is in first place, so, who is in first place in attracting foreign investment? It is Singapore because those big investors, such as Warren Buffett, or Bill Gates, put their money where they feel that they are going to have greater earnings with less difficulty,” Reyes pointed out.

He explained that it is not that he has received any pressure, from some international agency for the country to have a law of this kind, but rather that the Ministry of Economy has the mission to increase the country’s competitiveness, and this will happen depending on how the Dominican Republic is seen from outside. Therefore, he feels that they should improve the indexes of the business climate and of global competitiveness. “Without a bankruptcy law it is very difficult to improve,” he said.

Setbacks for not having a bankruptcy law

The Deputy Minister of Economy said that an additional problem of not having a bankruptcy law in the country has a lot to do with the protection of the rights of workers, of creditors and with the setbacks that this brings to foreign investment, to the business climate and as a result the negative impact in the loss of jobs. “If we can keep the companies without them having the obligation to close, we’re going to keep jobs that are vital for the economy,” Reyes pointed out.

Source: DiarioLibre

April 28, 2015

Category: DR News |

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