When an execution request issues against a debtor who genuinely cannot pay, both sides face mirrored questions: what statutory options does the insolvent debtor have, and what can the creditor do when met with an insolvency claim? This page presents both tracks in a neutral frame, as part of the enforcement and debt section on Hala Law.

The debtor's track: inability to pay does not mean ignoring the file

If the debtor is genuinely unable to pay, the path is not to ignore the execution request. The practical options, per the source material:

| Option | Substance | | --- | --- | | Grace or deferment | Requesting a grace period or deferment of the executive instrument via Najiz | | Proving insolvency | Submitting proof of insolvency or of current inability to pay | | Rescheduling | Negotiating a written rescheduling with the creditor | | Terminating execution | Submitting a request to terminate execution where payment or settlement has occurred | | Merchant tracks | If the debtor is a merchant or company, the matter may fall within bankruptcy or financial reorganization tracks depending on the case |

The grace/deferment service on Najiz

The Najiz service for requesting a grace period or deferment of the executive instrument allows submitting a grace request within the enforcement file, specifying the duration, the reason, and the declaration, then sending the request. It is also one of the tracks presented — alongside objection and proof of payment — on the objecting to an execution order page for anyone who has received an execution order.

The effects of insolvency under the current Enforcement Law

The current Enforcement Law attaches significant effects to insolvency, including, per the source material:

| Effect | Substance | | --- | --- | | Future seizure | Seizure of the debtor's assets that appear in the future | | Credit notification | Notification of the licensed credit bureau | | Resubmission | Enabling the creditor to resubmit the instrument if assets of the debtor appear | | Merchants | A merchant's bankruptcy is governed by the bankruptcy provisions |

As these effects show, insolvency is not a write-off of the debt: it is a status with statutory arrangements that keep the creditor's right alive against whatever assets may appear.

The creditor's track: an insolvency claim does not extinguish the debt

If the debtor claims insolvency, that does not mean the debt lapses. Per the source material, the questions to examine include:

  • Are there assets?
  • Are there suspicious transfers?
  • Is there real estate, are there vehicles, or company shares?
  • Is there regular income?
  • Are there indications of asset concealment?

The Enforcement Law also includes penalties for whoever obstructs enforcement, conceals assets, or provides incorrect information. For a creditor opening an enforcement file with an executive instrument, the filing steps are on the execution request on Najiz page; a creditor without an executive instrument follows the financial claim lawsuit route.

Statutory transition status

A new Enforcement Law was issued in 2026. According to professional sources published after its issuance, it enters into force 180 days after its publication, with important transitional rules — particularly around the electronic registration of certain commercial papers through national platforms such as Nafith, with special rules for pre-existing notes. This page is based on the current Enforcement Law and will be reviewed when the new law and its implementing regulations take effect.

When do you need a licensed lawyer?

The information here is a neutral general framework for both sides, not an assessment of any specific case. The matter becomes case-specific — warranting a licensed lawyer or accredited advisor — when:

  • The debtor needs to prove insolvency or current inability to pay with documents that withstand scrutiny.
  • A written rescheduling is being negotiated and needs drafting that protects both parties.
  • The creditor suspects asset concealment or suspicious transfers and needs a documented file.
  • The debtor is a merchant or a company, so the matter intersects with bankruptcy or financial reorganization tracks.

In those situations, the competent authority examines the facts and documents, and each party's position rests on the evidence it presents — not on any single general rule.