Bahrain: the Evolving Role of the Private Sector in Judgment Enforcement

In recent years, Bahrain has overhauled how court judgments are enforced, ushering in a new era of efficiency and private sector involvement. A landmark execution law reform in 2022 opened the door for licensed private companies and enforcement officers to take on many duties previously handled solely by a few court officials. This shift has transformed the execution of judgments – the process of collecting debts or obligations after a court ruling – making it faster, more transparent, and more effective for creditors and debtors alike. This article provides an overview of these developments, including the rise of private enforcement officers (and their dramatic growth in number), the integration of Bahrain’s credit bureau into the enforcement system, and the central role of the company Mazad in auctioning seized assets.

New era of judgment execution since 2022

Bahrain’s execution law reform (effective March 2022) marked a turning point for the country’s legal system. The new law was designed to modernise and streamline judgment enforcement, addressing long-standing issues in the old framework. Prior to 2022, enforcement of civil judgments was notoriously slow and cumbersome – a handful of court officers had to manually handle all enforcement steps, leading to backlogs. For example, under the old system, an enforcement action as simple as freezing a debtor’s bank account could take months of paper correspondence between the execution court, the central bank and individual banks. Creditors often faced significant delays and bureaucratic hurdles in recovering debts, which undermined confidence in the system.

The 2022 reform directly tackled these inefficiencies. Crucially, the law enabled the court to delegate enforcement tasks to the private sector by introducing electronic linkages between courts and government entities, and consequently reduced the burden on judges and court staff. This public-private partnership approach leverages the resources and agility of private entities to support the execution process, under the court’s supervision. In parallel, the Ministry of Justice implemented electronic linkages between the courts and key government agencies (such as the Central Bank, the Survey and Land Registration Bureau, and the Ministry of Industry and Commerce) to replace slow paper-based communications with instant digital notifications. The overarching goal was to create more efficient procedures.

Two years following implementation, the impact of these changes is evident. Execution courts now operate in close co-ordination with private enforcement officers, a national credit bureau and a specialised auction platform – a stark contrast to the pre-2022 set-up. While the reforms are still relatively new, early signs indicate improved recovery rates and creditor confidence. The following sections delve into the key developments:

• the rise of licensed private enforcers;
• enhanced transparency via credit bureau integration; and
• the modernisation of asset auctions through Mazad.

Rise of licensed private enforcement officers

One of the most striking outcomes of the 2022 reform is the emergence of licensed private enforcement officers as a cornerstone of the execution process. These officers – officially termed Private Execution Officers (PEOs) – are individuals and firms from the private sector authorised by the Ministry of Justice to carry out enforcement activities on behalf of judgment creditors. Instead of relying on a few court employees, Bahrain now has an entire industry of trained professionals handling enforcement duties. As of mid-2025, 68 private enforcement firms employing over 200 officers are active in Bahrain, compared to only a handful of court staff previously performing these duties. This increase in manpower and resources has significantly impacted the scale and efficiency of judgment enforcement.

Structure and licensing

PEOs must operate within a registered company (commercial registration) and meet strict licensing requirements set by the Ministry of Justice. Each licensed enforcement firm is required to appoint at least three qualified individuals to carry out the on-the-ground duties. These officers undergo training through the Judicial and Legal Studies Institute and take an oath before the Minister of Justice upon licensing. They are officers of the court in practice; the law grants them the status of public officials when performing their duties, ensuring that they operate with integrity and accountability similar to government officials. The Ministry of Justice and the courts retain supervisory authority through regular administrative inspections of private enforcers’ work.

Duties and responsibilities

PEOs now handle almost all front-line execution tasks that were once the domain of court staff and judges. A judgment creditor who has an unpaid court judgment will engage a PEO to take the necessary actions to collect the assets on that judgment. Key responsibilities of PEOs include the following.

• Locating and seizing assets ‒ identifying the debtor’s assets and imposing attachments (liens or freezes) on them under court orders (ie, issuing attachments on real estate, vehicles and movable property).
• Administering sales and auctions ‒ taking charge of selling seized assets in co-ordination with Mazad in order to list and auction these items (discussed further below), replacing the old practice of court-run auctions.
• Notification and paperwork ‒ serving official notification of enforcement to debtors, which is a required first step (the debtor must be formally notified before coercive measures). They deliver court notices for the relevant authorities.
• Follow-up and compliance ‒ monitoring the progress of enforcement actions and ensuring that court orders are fully carried out. PEOs follow up on asset seizures. Effectively, PEOs keep the execution process moving forward efficiently until the judgment is satisfied or all avenues are exhausted.

By outsourcing these functions to specialised private actors, the execution process has become far more efficient and scalable. Creditors benefit from timely processes since they can approach a private enforcement firm that will immediately take up the file and pursue the debtor’s assets promptly (within the bounds of the law). The increase from five court personnel to over 200 PEOs means that cases get individual attention and proactive follow-up. Moreover, competition among the 68 licensed firms helps encourage high-quality service, innovation and responsiveness – if one firm is not effective, a creditor can hire another, which creates an incentive for these enforcement businesses to perform well. Turnaround times for routine enforcement actions (eg, repossessing a car) have dropped dramatically in the past two years, as the workforce available for enforcement has expanded and modern tools are being used.

It is worth noting that PEOs act under judicial supervision despite being independent parties. The execution judge still oversees the process and must approve critical steps (eg, authorising an auction or ordering an attachment). In practice, this means that Bahrain has adopted a collaborative model: the court sets the direction and legal authority, while PEOs execute operational tasks. This model combines the authority of the judiciary with the agility of the private sector, and it has largely met its goal of a faster, more effective enforcement regime. The Ministry of Justice has highlighted this initiative as part of a broader Economic Recovery Plan to improve the business climate by speeding up access to justice and enforcement. For businesses and lenders, the rise of PEOs means that a court victory can translate much more quickly into actual recovery of money or assets, rather than being tied up in procedural delays.

Integration with the Benefit Company (credit bureau): transparency and lender protection

Another breakthrough development in Bahrain’s enforcement landscape is the integration of the judgment execution system with the national credit bureau, known as the Benefit Company. It is licensed by the Central Bank of Bahrain, and is the Kingdom’s official credit reference bureau, maintaining credit reports on individuals and companies. Historically, credit reports captured a person’s debts and defaults with banks and financial institutions, but court judgments for unpaid debts (so-called non-banking debts) were outside this purview. A person could owe significant sums under a civil court judgment – for example, unpaid trade invoices or damages awarded in a lawsuit – and still potentially obtain new loans from banks, as the banks had no visibility of those court-ordered debts.

The new execution law addressed this gap by mandating greater financial transparency through credit reporting. Under the law, if a judgment debtor’s known assets are insufficient to pay the debt, the execution court judge will order an annotation (mark) to be placed on that debtor’s credit report for a period of seven years. In practice, the court’s system is electronically linked with the Benefit Company, so that such judgments in execution are reported into the credit bureau’s database. All banks and lenders inspecting that person’s credit will thus see the outstanding judgment noted on the report, much like they would see a defaulted loan or credit card balance. This simple step has far-reaching effects in improving transparency and protecting lenders from hidden risks, such as through the following.

Visibility of non-bank debts

Lenders now get a holistic picture of a borrower’s obligations. The credit report annotation ensures that even debts arising outside the banking system (eg, a court-ordered payment to a private business or individual) are visible. This prevents scenarios where a debtor heavily in arrears on court judgments could appear “clean” on credit checks. It addresses an information gap that previously existed in the financial sector.

Responsible lending decisions

Armed with this information, banks and other creditors can make more informed lending decisions. They can factor in court-recorded debts when assessing creditworthiness, which helps with avoiding new loans to already over-indebted borrowers. In essence, the integration helps protect financial institutions from inadvertently extending credit to someone who has a history of non-payment of civil debts. This reduces the risk of future loan defaults and contributes to the overall stability of the lending environment.

Pressure on debtors to pay

The prospect of a seven-year mark on one’s credit report provides a strong incentive for debtors to settle any amounts due via court judgments promptly. Borrowers are aware that failing to settle amounts due via a court judgment will hurt their credit score and ability to obtain financing or even certain services. For businesses, a public credit report annotation could affect their trade credit and reputation. Therefore, this measure encourages voluntary compliance – debtors are more likely to settle or negotiate payment to avoid long-term credit consequences. This behavioural impact complements the direct enforcement by PEOs, creating a twofold approach (legal and financial) to encourage payment.

Transparency and trust

On a macro level, linking execution cases with the credit bureau promotes a culture of transparency and accountability. It signals to the market that Bahrain is serious about debt enforcement and credit discipline. Over time, this can lead to more prudent borrowing and lending practices. Creditors – especially in the banking sector – have welcomed the change as it mitigates the risk of debtors piling up unsustainable debt across different sectors, which was a concern before. By making court judgments part of one’s financial record, Bahrain is aligning with best practices that ensure that credit systems reflect all pertinent liabilities of a borrower.

From a practical standpoint, this integration was enabled by the electronic systems put in place during the reform. The execution courts can automatically update the credit bureau once a judge issues an order. The debtor is usually notified that their name will be flagged in the credit bureau, giving them an additional reason to resolve debt. It is important to note that the credit report annotation is not arbitrary – it is typically applied in cases where the debtor has insufficient assets to pay, effectively marking them as a higher credit risk. The annotation remains for seven years or until the debt is resolved, whichever comes first – after which it can be removed, allowing the debtor to rehabilitate their credit.

Overall, the court’s collaboration with the Benefit Company has been a win-win for financial transparency. This collaboration helps protect future creditors (banks, leasing companies, etc) from unknowingly extending credit to bad debtors, and it adds an extra layer of consequences for those who might ignore court judgments. For the public, the message is clear: if you are owed money and have to go to court, Bahrain’s system now ensures that the judgment will follow the debtor into their credit history, making it harder for them to escape the debt.

Mazad and modernised auctions of seized assets

A standout feature of Bahrain’s revamped enforcement regime is the partnership with Mazad to conduct public auctions of seized assets. Mazad (which means “auction” in Arabic) is a Bahrain auction platform that has become central to the disposal of assets recovered through court execution. Under the old system, selling a debtor’s property – such as real estate or vehicles – to satisfy a judgment was often a drawn-out affair. Auctions were typically organised and held at the courthouse, with a judge overseeing the bidding. These judicial auctions could face delays, limited publicity and procedural formalities that slowed the return of funds to creditors. There were cases of multiple auction sessions if bids were too low and did not reach the value of the asset, as well as a general sense that the process was inefficient and inconvenient for buyers and court staff alike.

Today, Bahrain has effectively outsourced the auction process to Mazad, bringing in professional auctioneers and online technology to replace the old judge-led sales. The collaboration with Mazad actually began as an innovative pilot even before the new law and was later codified as an integral part of the 2022 execution law reform. Now, when a court orders that a debtor’s assets be sold to satisfy a judgment, the case’s appointed PEO will co-ordinate with Mazad to handle the auction logistics. This applies to a range of assets – real estate, cars, equipment and other movable property can all be auctioned through Mazad’s platform, as directed by the execution court.

How Mazad’s auctions work

Mazad Bahrain is the overseer of public and electronic auctions in the Kingdom. It operates a modern digital auction platform accessible via web and mobile app, enabling broader participation and more efficient sales. Key characteristics of the Mazad-led auction process in judgment enforcement include the following.

i) Professional auction management

Mazad handles advertising the auction, arranging viewings and conducting the sale in a transparent manner. Because Mazad specialises in auctions, it can tap into a larger pool of potential buyers (including its network of registered bidders) and market the assets more effectively than the court could. This often results in better turnout and better prices being realised for the assets, which ultimately benefits both creditors and debtors (higher sale prices mean that the debt is paid with less leftover liability for the debtor).

ii) Digital and online bidding

Unlike the old courthouse auctions where bidders had to be physically present at a specific time and place, Mazad enables online bidding through its app and website, in addition to live auctions or direct sales when appropriate. This greatly increases convenience and reach – bidders from anywhere can participate, and auctions can conclude faster without logistical delays. For example, a repossessed car can be listed in an online auction that runs for a set number of days, allowing many bidders to compete, whereas previously that car might have been auctioned in a single afternoon session with only those who showed up.

iii) Speed and efficiency

Mazad’s involvement has significantly shortened the timeline for converting seized assets into cash. Once an asset is attached by the private enforcer and cleared for sale, Mazad can often schedule an auction within days or weeks, compared to months of waiting under the old court-run system. The lengthy judge-led auction process – with court approvals at each step and limited auction dates – has been replaced by a streamlined procedure where the judge’s role is primarily to approve the sale result rather than micromanage the auction. This means that creditors get proceeds faster and cases move to resolution more quickly.

iv) Transparency and fairness

Having a neutral, specialised entity such as Mazad conduct the auctions helps ensure that fair market value is obtained in an open process. All auctions are public (and are often publicised on Mazad’s platform), reducing the risk of any perception of insider deals or non-transparent sales that sometimes plague in-court auctions. The execution court still supervises to an extent – for instance, it will set any reserve price or minimum bid requirements and confirm the final sale – but Mazad handles the bidding process professionally. This public-private synergy promotes confidence that seized assets are sold for a fair price under competitive bidding, which is important for both sides: the creditor wants maximum recovery, and the debtor is entitled to not have their property sold for an unreasonably low price.

Replacing the old courthouse auctions

The difference between the past and present is perhaps most vividly seen in how a property foreclosure is handled. Before 2022, if a creditor enforced a judgment against a debtor’s real estate, the court would announce an auction to be held at the courthouse. A judge would convene the auction, often on a morning with a handful of bidders present, and if the bids were too low (below appraised value) the judge might postpone the sale to another date. This could repeat multiple times, dragging out the enforcement for many months or even years in complex cases. Debtors sometimes remained in possession of properties during these delays, and creditors saw diminishing prospects of recovery.

Now, under the new system, that same property would be handed to a private enforcer, who would co-ordinate with Mazad to list the property in a timely public online auction. Interested buyers get ample notice through Mazad’s marketing, and they can bid from anywhere. When the auction closes, the highest bid is reported to the execution judge, who can quickly ratify the sale and order the proceeds distributed. What used to be a judge-centric process is now a business-centric process – leveraging the auction company’s expertise to handle the sale efficiently, with the judge maintaining only an oversight role. This has eliminated the backlog of unsold assets and reduced the administrative burden on the courts. One indicator of success is that, since Mazad took over auctions, auction cycles that once took six to 12 months or more just to auction the asset have been shortened to a matter of weeks in many cases, barring any legal objections from the parties.

For businesses in Bahrain, involvement in litigation that results in asset seizure now typically leads to the sale of those assets to be handled by Mazad. For example, if a business wins a lawsuit and enforces the judgment, and the debtor’s warehouse of goods leads to a seizure issued to settle the judgment, those goods might be auctioned on Mazad’s site to convert them to cash. Conversely, if a company is subject to a judgment and is unable to pay, its assets could be swiftly taken and sold through a public auction process, which leaves little room to hide assets or delay the inevitable sale.

Conclusion: a transformed enforcement landscape

Since the 2022 execution law reform, Bahrain’s approach to enforcing judgments has undergone a remarkable transformation, driven by private sector engagement and digital innovation. In just over three years, the execution process has evolved from a slow, court-bound procedure into a more dynamic system where private enforcement firms, a credit bureau and an auction platform work in tandem with the courts. The introduction of 68 private enforcement firms with over 200 officers has greatly expanded the capacity to enforce rulings, ensuring that each case gets prompt attention and specialised handling. Creditors now have partners who will chase down assets and follow through on every step, rather than having to prod an overburdened court bureaucracy. Debtors, on the other hand, face a more organised enforcement regime – though one that is also more transparent and rules-based, with checks (such as ministry and judge oversight of enforcers) to prevent abuse.

The integration with the Benefit Company’s credit reporting means that the effects of a judgment extend beyond the courtroom into the financial life of the debtor, thereby discouraging default and protecting the lending ecosystem from hidden risks. Additionally, through Mazad’s auction system, the liquidation of seized assets has become faster and more market-driven, benefiting all parties by maximising returns and minimising delays. These changes collectively support a more creditor-friendly environment in Bahrain, which is important for economic growth – businesses and banks are more willing to extend credit or engage in transactions when they know that, if things go wrong, the legal system can enforce obligations efficiently.

In sum, the Kingdom of Bahrain’s execution process is now faster, more transparent and more creditor-friendly, without losing sight of fairness and accountability – a transformation that ultimately benefits the business climate and rule of law in Bahrain.