The Efficacy of the Insolvency Legal Regime in the Economic Development of Uganda.

Abstract

Even with substantial body of literature in the areas of insolvency in the past years, scholars have not specifically discussed in depth the rights attributed to the creditors benchmarking with the strength of the credit system and economic development in the Ugandan perspective. This dissertation addresses this perspective. It discusses the collective nature of Insolvency proceedings given the need to balance the interests of all creditors irrespective of their claims. The study traces the background of Insolvency legal regime highlighting the subsequent developments up to the recent amendment of the Insolvency Act in 2022. It also examines the nature of Uganda’s economy within which the Insolvency legal regime operates in addition to identifying the causes of corporate Insolvency, individual bankruptcy and the informal rescue mechanisms available to Insolvent companies.

The study critically reveals the existing loopholes especially in the law of receivership, provisional administration, administration and liquidation as formal mechanisms fronted by the Insolvency Legal Regime that cause uncertainty within the credit system of Uganda and how the loopholes hinder the economic development of Uganda.

In conclusion, it proposes the regulatory reforms based on findings to introduce more efficient and effective Insolvency mechanisms taking into consideration the need for balance of interests and collective realization of resources for the benefit of all creditors and promoting economic development in Uganda.