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THE Dewan Negara today passed the Cross-Border Insolvency (CBI) Bill 2025, marking a significant step towards enhancing legal cooperation between Malaysia and other jurisdictions in handling corporate insolvency matters that cross international borders.
The newly adopted legislation incorporates provisions from the 1997 United Nations Commission on International Trade Law (UNCITRAL) Model Law on Cross-Border Insolvency, providing a structured legal framework for the recognition of foreign insolvency proceedings.
Currently, such matters are governed through judicial practice based on the doctrine of comity—where foreign court decisions are acknowledged out of mutual respect—and the principle of reciprocity.
In his winding-up speech, Deputy Minister in the Prime Minister’s Department (Law and Institutional Reform), M. Kulasegaran, clarified that the scope of the Bill was limited exclusively to corporate insolvency.
“The application of this Bill is limited to insolvency proceedings involving corporate entities only,” he said.
He added that the government remained open to recommendations to further refine the legislation.
“The government is always open to suggestions on improving the Bill,” he stated.
The passage of the Bill brings Malaysia closer in line with international standards and may facilitate smoother collaboration between judicial and administrative authorities across different legal systems in insolvency cases involving multinational entities. - September 9, 2025