📈 Speaker Endorses Landmark Rescue, Rehabilitation and Insolvency Bill into Law

The Rescue, Rehabilitation and Insolvency (Corporate and Personal) Bill has officially become law following the endorsement by Speaker Dr. Jagath Wickramaratne, coming into force as Act No. 12 of 2026. • Key Legislative Changes: The new Act introduces comprehensive procedures for personal insolvency and debt restructuring while repealing the outdated Insolvency Ordinance (Chapter 97). It also amends the Companies Act No. 7 of 2007, the Inland Revenue Act No. 24 of 2017, and the Mediation Boards Act No. 72 of 1988. • Corporate & Economic Impact: The framework addresses corporate governance, receivership, and cross-border insolvency. This is designed to enhance predictability and boost investor confidence within the Sri Lankan credit market. It provides a structured mechanism to rehabilitate distressed but fundamentally viable companies, supporting business continuity and employment stability. • Personal Debt Relief: For individuals, the Act establishes clear provisions for debt protection, moratoria, and debt restructuring, ensuring the protection of a debtor’s reasonable income and essential assets to facilitate a fresh start for honest individual debtors. • Timeline: The Bill was first read on 17 March 2026, debated and passed on 6 May 2026, and officially enacted this week.