Legal Update | Issuance of New Rules for Determining Bankruptcy Trustees’ Remuneration in Bahrain

Date of Issue: 8 July 2025
Authority: Ministry of Justice, Islamic Affairs and Waqf
Instrument: Ministerial Decision No. (61) of 2025
Effective Date: The day following publication in the Official Gazette

In a recent development for Bahrain’s insolvency and restructuring framework, the Minister of Justice, Islamic Affairs and Waqf has issued Decision No. 61 of 2025, setting out comprehensive rules for determining the remuneration of bankruptcy trustees. These new rules aim to promote transparency, consistency, and efficiency in the administration of bankruptcy cases under the Reorganization and Bankruptcy Law No. 22 of 2018.

The decision defines clear parameters and stages for calculating trustee remuneration, covering both standard duties and exceptional efforts. It also outlines when and how trustees may receive payments, the procedure for raising objections, and the priority of trustee claims over other unsecured debts.

Notably, the remuneration will now be assessed based on factors such as the complexity and value of the debtor’s estate, the efforts undertaken to protect and maximize assets, and the trustee’s involvement in formulating reorganization or liquidation plans. The court retains discretion to adjust the proposed amounts based on these criteria and may grant exceptional bonuses in cases where trustees contribute to material recoveries or expedited resolution.

The new framework further includes detailed payout schedules for different trustee roles:

• Reorganization Trustees
• Liquidation Trustees
• Interim Trustees

Each role has its own tiered structure, linking remuneration to specific procedural milestones, such as initiating proceedings, completing a report on the debtors assets, completion of the proposed reorganization/liquidation plan as the case may be, or completion of disbursements.

This decision also reinforces procedural safeguards by empowering courts to review or revisit trustee remuneration either on their own motion or upon applications by the debtors, creditors’ committee, or qualifying creditors. Interested parties may raise their objections within 30 days of the fee determination. In all cases, trustee remuneration and necessary expenses are treated as administrative claims and are prioritized over all other unsecured claims, including other administrative claims.

By enacting these rules, the Ministry of Justice, Islamic Affairs and Waqf takes a further step toward strengthening Bahrain’s insolvency regime, fostering predictability for professionals, and aligning local practice with international standards.