[Photo: File]

Fijians struggling with mounting debts could receive a 60-day reprieve from creditor recovery action.

This has been made psosible under a new insolvency framework passed by Parliament.

The proposed debt protection moratorium will temporarily suspend creditor debt collection actions, giving financially distressed individuals time to obtain advice, assess their financial position and negotiate repayment arrangements.

Lands and Mineral Resources Minister Filimoni Vosarogo says the Personal Insolvency, Financial Rehabilitation and Entrepreneurial Rescue Bill 2025 introduces alternative mechanisms to formal bankruptcy, providing debtors with more flexible options to address financial difficulties.

The 60-day moratorium is one of three key measures introduced under the legislation, alongside a debt rehabilitation order and a voluntary debt restructuring arrangement.

The debt rehabilitation order provides a simplified, fast-track process for low-value insolvency cases, while the restructuring arrangement allows debtors and creditors to negotiate revised repayment plans, including partial debt payments.

These mechanisms are intended to make debt resolution more accessible and reduce reliance on the formal bankruptcy process.

Vosarogo says the reforms replace the complex and uncertain conditional discharge system under the Bankruptcy Act 1944 with a framework that provides for debt discharge for honest debtors who comply with the prescribed requirements.

However, the legislation does not offer blanket protection to everyone facing financial difficulties.

Vosarogo states that safeguards have been incorporated to ensure that only honest debtors who meet the requirements of the insolvency process benefit from the more flexible arrangements.

The Attorney-General says the reforms are intended to balance the interests of debtors and creditors by providing opportunities for financial recovery while maintaining
procedures for responsible debt repayment.

Deputy Prime Minister Manoa Kamikamica adds that the legislation will strengthen Fiji’s business environment by providing a structured way to manage financial distress rather than allowing business difficulties to automatically result in failure.

Businesses, he says face pressures from rising costs, changing market conditions, supply chain disruptions and unforeseen circumstances, making it important for the law to provide effective recovery mechanisms.

Opposition MP Faiyaz Koya also supported the Bill, saying the existing insolvency framework dates back to 1944 and requires modernisation to address the realities facing individuals and smaller businesses.

Koya says the Parliamentary Committee’s engagement with stakeholders and those responsible for implementing the legislation helped establish the need for the reforms.

The Bill is specifically concerned with personal insolvency and does not govern company insolvency.

It can, however, cover owners of unincorporated businesses and partnerships facing personal financial liabilities.