News that state-backed Dubai World had requested to restructure $26bn of liabilities in 2009 shook the economic foundations of the once-booming emirate and sent global stock markets spiraling.
While last week’s announcement that its shipbuilding subsidiary, Drydocks World, would test a new form of insolvency protection had little to no effect on regional markets, it did mark a turning point in the emirate’s move to bring its bankruptcy laws — and attitudes towards debt — in line with global practices.
Drydocks’ filed for insolvency protection under Decree 57 of the Dubai World Tribunal in a bid to help it enforce a $2.2bn restructuring plan on a minority of resistant creditors. Parent company Dubai World said the filing was a “pragmatic and sensible decision”.
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