Bankruptcy Expert Witness in UAE | Report and Procedures

When a dispute arises over the value of a debtor’s company, real estate, or other assets, the debtor’s financial projections, or their overall viability, an expert witness is often called into bankruptcy proceedings. Where needed, the court or the parties may appoint one or more experts to provide opinions on issues central to deciding the case.

Where this is the only practical way for a party to support their claim or defense, the court has no choice but to appoint an expert. Referring technical issues to experts where the court must rely on their specialized knowledge is permissible, but an expert report should only be accepted after thorough examination by both the court and the parties.

What Is an Expert Witness Report?

An expert report sets out the expert’s opinion on subjects within their field of expertise that they’ve been asked to address. Its primary purpose is to guide the court on matters outside its own authority, but on which it must still decide to resolve the dispute.

The court, the instructing party, and their counsel use the report to obtain technical information supporting an evaluation of the case’s merits. During hearing preparation, the report is shared with the opposing party, allowing them to assess the strength of their own position. If the opposing side has its own expert witness, both parties receive each other’s reports around the same time.

Also check: Court Expert Witness

Guidelines for Structuring an Expert Witness Report

• The report should summarize the facts and assumptions the expert relied on in their analysis, alongside their conclusion, meeting applicable legal standards. The expert’s opinion and the underlying facts should be kept clearly separate.
• The reasoning behind the report’s findings should be genuinely understandable and easy to follow. Even where the report covers highly technical subject matter, it should be explained clearly enough for an educated layperson to follow.
• Language should be clear, with acronyms used sparingly. The expert should summarize the instructions they received, regardless of how those instructions were originally given, written instructions are preferable, and verbal instructions should be reaffirmed in writing to avoid misunderstandings later.

Can the Expert Appointment Application Improve the Claimant’s Position?

Following Article 69 of the UAE Federal Evidence Law, UAE courts frequently select experts to draft reports in the cases before them, often applying this technique even where the need for specialized knowledge isn’t immediately obvious. Courts typically appoint an expert either through a preliminary ruling after arguments, or at a party’s request.

• A favorable expert opinion can strengthen the applicant’s position and encourage the opposing party to settle without litigation, once they’ve had a preview of the evidence that would be used against them in court.
• Once proceedings begin, the applicant may rely on the expert report as evidence, though its probative value remains subject to the court’s own assessment. The court can appoint a different expert if it chooses, and isn’t required to accept the original expert’s findings.
• Regardless of its conclusion, an expert report can still be a useful tool for assessing the strength of a case and deciding on next steps. The parties can still approach the court directly without ever appointing an expert, if they choose.

Must check: Company Liquidation / Bankruptcy / Insolvency

Role of the Expert Witness Report in Bankruptcy Procedures

To evaluate a debtor’s restructuring application under UAE bankruptcy law, Federal Decree-Law No. 51 of 2023, effective 1 May 2024, the court may appoint an expert to compile a report on the debtor’s financial position. The report addresses two core questions:

1. Whether a restructuring is genuinely feasible, and
2. Whether the debtor’s assets are sufficient to cover the costs of that restructuring

Depending on the court’s decision, the application may be approved, or bankruptcy proceedings may begin instead. The current bankruptcy law represents a significant advance over the earlier system, adopting a more contemporary approach centered on rescuing and restructuring troubled businesses, with liquidation treated as a last resort once other options have genuinely been explored.

Worked Example: Assessing Restructuring Feasibility

A company facing financial distress applies for restructuring rather than liquidation. The court appoints a financial expert to assess whether the plan is genuinely viable. The expert reviews the company’s cash flow projections, existing debt obligations, and the realistic market value of its assets, finding the business generates enough projected operating cash flow to service a restructured debt schedule over a reasonable period, and that its assets, while insufficient to cover the debt in full if liquidated today, are sufficient to fund the restructuring process itself. The expert’s report concludes the restructuring is feasible, giving the court a substantive, evidence-based basis for approving the application rather than defaulting to liquidation. Had the expert instead found the company’s projected cash flow couldn’t realistically service even a restructured obligation, the report would support the opposite conclusion, that liquidation is the more appropriate path.

Because the current system relies heavily on local courts, court-nominated trustees, and appointed experts rather than dedicated specialist bankruptcy courts, how well the framework functions in practice depends considerably on the quality of these individual appointments. Directors of a debtor company should also be aware that, while the law has moved away from criminalizing the general liquidation process, they can still face substantial personal criminal exposure in specific circumstances, making early professional guidance genuinely important before complications escalate.

Frequently Asked Questions (FAQs)

How Farahat & Co. Can Help

Farahat & Co., a trusted Audit Firm, provides bankruptcy and restructuring expert witness services, assessing financial viability and asset sufficiency for UAE court proceedings.

Contact Farahat & Co. today to discuss your bankruptcy expert witness requirements.