Financial settlement is the best way to get out of the crisis of some troubled companies
The Corona pandemic has caused some companies and stores to default, exposing their business to decline, weak productivity, inability to keep up with the daily demand for goods, and their entry into financial claims such as paying debts, issuing checks without balance, and being unable to meet customer needs.
In meetings with Al-Sharq, legal professionals stressed that the financial settlement is the best way to get out of the crisis of some troubled companies, and that their exposure to these failures led to their falling into financial claims by other companies or clients.
They noted that the support provided by the state in terms of financial facilities, the reopening of commercial establishments and the return of the commercial sector to life again after the gradual lifting of restrictions will lead to solving many outstanding problems, including debts and loans, and thus finding gradual solutions to financial claims.
They indicated that financial claims face most companies that suffer commercial setbacks in their businesses, such as debts, loans, poor production, or a lack of demand for goods, for example, stressing that careful follow-up of business and any activity carried out by the trader will enable him to avoid risks.
Legal officials stated that the financial claims resulted from the period of closures of stores and commercial establishments, which were unable to avoid their losses or compensate for their lost earnings, and were unable to stand on their feet again, as this caused a number of legal violations as a result of financial arrears.
Some companies were able to conclude financial settlements with the violating parties, or to enter into new fields of work to avoid penalties, while others are still before the courts on charges of issuing checks without balance or signing false contracts or loans and accumulated debts.
The judiciary is looking into a number of companies that have been affected by the epidemic, whether by closure, accumulation of debts, or stopping work, and some have managed to pay off their debts, others have returned to practice their activities in the market, and some have entered into settling their debts and paying them in installments.
They believe that the easy measures put in place by the state and the flexible facilities it provided for the various fields of work will reduce the damage caused by the Corona epidemic on the commercial market, and that the return of the life cycle after the gradual lifting of restrictions will allow companies to resume their activities and reduce their losses.
Business sectors seek to facilitate the return to commercial activity without accumulations and financial irregularities, and to start formulating new activities that meet the needs of the public.
Attorney Dhahnan Al-Hajri: The financial settlement is a way to save companies from default
Lawyer Dhahnan Al-Hajri said: The cessation of some companies from work or the continuation of their production due to the accumulation of financial claims with them, their inability to meet the needs of their customers or the lack of sufficient liquidity to return to work again.
He explained that despite the support provided by the state, it did not resort to this support or was no longer able to continue its work, and these circumstances are not local but global, as Corona caused a negative impact on companies and stores that have defaulted financially.
He explained that the way out of this crisis is the solidarity of companies and business owners among themselves, and work to settle financial matters as much as possible with agreement and flexibility, and not resorting to the judiciary or complaints except in the narrowest matters.
He added that the epidemic has turned into an economic crisis, and that caution and caution must be taken when dealing with financial transactions and returning to commercial activity, according to encouraging data, especially that the state has stood by the companies and created a suitable business environment and this helps them to grow.
Attorney Ahmed Al-Subaie: The crisis has caused financial violations for companies
Lawyer Ahmed Al-Subaie explained that the Corona crisis caused violations of commercial dealings due to the cessation of a number of activities, and consequently the merchant’s inability to pay the checks due to him, and the bounced checks appeared because he became the merchant in financial trouble because of his inability to pay shop rents, employee salaries, or goods prices.
He said: The owners of private projects and companies are those who were unable to pay the commercial checks required of them, adding that some have fake companies or electronic links that provide services without a reliable reference.
He explained this by the absence of regular monitoring and follow-up and the insufficient penalties against the owners of companies via the Internet, and that the lack of effectiveness and periodic supervision over them causes their increase.
Attorney Ali Al Dhaheri: Lack of audit is one of the reasons for financial irregularities
Lawyer Ali Al Dhaheri said: The reasons for financial irregularities are the lack of discipline and the absence of scrutiny on the owners of financial dealings, which has led to some exploiting the people’s need for interests and debts
And he advised the public to make sure of the person they want to deal with directly.
Attorney Muhammad Al-Badr: The suspension of companies led to an accumulation of debts
Lawyer Muhammad Al-Badr said: The occurrence of financial and commercial violations is due to the Corona pandemic and due to the closures of shops and companies that led to the accumulation of debts and financial obligations on their owners, and these damages were reflected in aspects of financial dealings not locally but internationally, which witnessed a major setback in the trade and production sector.
He added that the inability of dealers or company owners to fulfill their financial obligations led to their falling into financial irregularities or issuing checks without balances and their inability to keep up with the demand for trade.
He pointed out that some are considered violators because they take advantage of the inability to fulfill financial obligations in writing checks or engaging in unsafe financial transactions, and some are victims of successive financial losses due to the recession that struck the world from Corona.
He advised the community that financial transactions should be taken into account in accordance with applicable laws, and that the weakness of commercial gains and losses suffered by some need to be re-examined by their owners and a return to their activity again, and that the current conditions are temporary and the world is going through it and not just local.