Factoring is a financing tool that helps businesses, particularly small and medium-sized enterprises, manage their working capital and use the assets listed on their financial statements as a form of collateral to obtain funding. By providing liquidity to these companies, factoring contributes to their growth and enhances their role in the economy.
The PCMA, in cooperation with the European Bank for Reconstruction and Development, has prepared a draft factoring law that is consistent with local legislation. This draft was reviewed by the legal team appointed by the European Bank for Reconstruction and Development in comparison with the Model Law on Factoring issued by the International Institute for the Unification of Private Law (UNIDROIT). Following confirmation that the Palestinian draft aligns with the Model Law, the legal team proceeded to prepare an explanatory memorandum and a legislative policy paper for the law in Arabic. At the same time, the PCMA’s team is currently reviewing these documents in preparation for presenting them to the Board of Directors, as well as to the public and relevant stakeholders for discussion.
