Sharjah court lifts arrest warrant in Dh2m debt case

Sharjah: A Sharjah court has cancelled an arrest warrant against a Gulf national over a debt exceeding Dh2 million after he submitted proof that Dubai Courts had accepted his insolvency application.

The Sharjah Civil Execution Court's decision followed the debtor's request to suspend arrest proceedings while his insolvency case was being considered in Dubai. The creditor had also sought the seizure of his bank accounts, properties, vehicles, shares and other assets to recover the outstanding debt.

The debtor approached the Sharjah court in March 2026, seeking to have the arrest warrant temporarily lifted pending a decision on his insolvency application before Dubai Courts. The court initially rejected his request, asking him to provide proof that the application had been accepted. It later cancelled the arrest warrant after he submitted the required documentation.

The case dates back to October 2025, when the Sharjah Court of First Instance ordered the debtor to pay Dh2 million to a creditor, along with annual interest of 5 per cent from the date the case was registered until the debt was fully settled. He was also ordered to pay court costs.

The debtor was notified of the payment order in December 2025 and given seven days from the day after notification to pay. When he failed to settle the amount within the deadline, the court issued an arrest and apprehension order.

The creditor subsequently sought an inquiry into the debtor's assets and requested the attachment of his available funds and property, including bank accounts, real estate, vehicles and shares.

How insolvency proceedings protect debtors

Dr Alaa Nasr, the debtor’s legal representative, said financial distress cases must be viewed separately from the legal measures taken to recover outstanding debts.

He explained that insolvency proceedings allow debtors to present their true financial position before the court, supported by documents detailing their income, assets and liabilities. This enables the court to assess their circumstances and determine the appropriate action in accordance with the law.

Dr Nasr said acceptance of an application to initiate insolvency and asset liquidation proceedings provides debtors with legal protection while the case is being considered and until a court judgment declaring insolvency is issued.

The protection includes suspending judicial enforcement proceedings against the debtor’s assets and stopping the accrual of legal and contractual interest, including late-payment interest.

During this period, all financial claims fall under the supervision of the court and the appointed trustee, who is responsible for identifying outstanding debts and verifying creditors’ entitlements.

He added that the legal protection also allows debtors to seek the lifting of arrest and apprehension orders linked to enforcement proceedings, subject to the decision of the competent court.