Egypt’s parliament approved on Sunday a new bankruptcy law in further aims to encourage local and foreign investment in the country, Invest-Gate reports.

According to a report by Moody’s Investors Service, the new law is credit positive for banks as it will provide them with more options to deal with viable troubled companies, making loan workouts more flexible and faster. The law also abolishes prison sentences in bankruptcy cases and limits punishments to a monetary fine.

The new law aims to minimize the need for companies or individuals to resort to the courts and to simplify post-bankruptcy procedures. Courts also have the right to enforce a restructuring plan if a consensual solution is not reached.

Under the law, a restructuring plan must be completed within 60 days of filing for a standstill, although a judge has the right to extend that period.

The bankruptcy law also reduces the liquidation period for a nonviable company to nine months as compared to the current average of more than two years.