Any debtor, who has been declared insolvent debtor by a final judgment and is proven to have committed any of the following actions, shall be considered insolvent debtor by default and shall be punished with imprisonment sentence and / or a fine not exceeding one hundred thousand UAE dirhams (AED 100,000): 1. Spends exorbitant amounts for its personal expenses or household expenses, if any of the same is among the reasons for its cessation of payment. 2. Fails to keep sufficient commercial books to determine the true financial position or to carry out the inventory required in accordance with the law. 3. Refrains from submitting the data requested by the trustee, the Bankruptcy Court or the Court of Appeal. 4. Pays any debt in a manner contrary to the terms of the preventive settlement proposal or the approved plan or Dispose of any assets in a manner contrary to the terms stated in the proposal or plan. 5. Pays, subsequent to the cessation of the payment, a debt to any of the creditors to the detriment of the rest or provide a guarantee or special benefits to any of the creditors in preference to the rest, even if the same is made with the intention of obtaining the approval of the required majority on a preventive settlement proposal, plan or composition. 6. Disposes of its goods or any of its assets or rights at a significantly lower price or market value with the intention of delaying its cessation of payment or declaration of its bankruptcy, delaying the rescission of the composition, preventive settlement proposal or plan or, for this purpose, resorting to illegal means to obtain sums of money. 7. Spends huge sums of money on fictitious speculation in matters other than the activities required for its business.
Interpretation and application must be checked against the official text and current version.