Commercial Companies Law — articles 1–100

For the purpose of applying the provisions of this Decree Law, the following words and expressions shall denote the meanings assigned thereto respectively, unless the context requires otherwise: The State: the Unites Ara…

This Decree Law aims to contribute to the development of the business environment and the capacities of the State and its economic standing by way of regulating the companies in accordance with the global variables, espe…

The provisions of this Decree by Law and the rules, regulations, and resolutions issued in implementation thereof shall apply to the following: 1. Companies that are established in the State. 2. Foreign companies that co…

1. Except for registration and renewal of registration in the register of exempted companies kept at the Ministry, the SCA and the Competent Authority, within their respective areas of competence, the provisions of this …

1. The provisions of this Decree by Law shall not apply to the companies established in the free zones of the State with respect to matters for which a special provision is stipulated in the laws or regulations of the co…

1. Subject to the requirements of the Central Bank with regard to the financial institutions falling under its control and supervision, the Minister shall issue the resolution regulating the governance of companies, exce…

The governance-regulating resolutions provided for in Article [6.1] hereof shall include fines to be imposed by the Ministry or the SCA, within their respective areas of competence, on the companies and their chairperson…

1. The Company is a contract whereby two or more persons undertake to participate in an economic project that aims to achieve profit by contributing a share of money or work, and to divide among themselves the profits or…

1. The Company shall take one of the following forms: a. General Partnership Company. b. Limited Partnership Company. c. Limited Liability Company. d. Public Joint Stock Company. e. Private Joint Stock Company. 2. Any co…

1. A committee, whose membership includes representatives from the competent authorities, and which is vested with the competence to propose activities with a strategic impact and the controls required to license the com…

1. The company shall obtain all the approvals and licenses required to engage in the business activities in the State prior to the commencement of business practice. 2. The Cabinet shall issue a resolution determining th…

1. The Company shall have a trade name that does not conflict with the public order of the State. The name shall be followed by the legal form of the Company. No Company may be registered with a name previously registere…

1. Every Company shall have a registered address in the State to which notices and communications shall be sent. 2. All contracts, documents, communications and application forms issued by the Company shall bear its name…

1. The MOA of the Company and any amendment thereto shall be drafted in the Arabic language and attested by the Competent Authority; otherwise, the MOA or the amendment thereto shall be null and void. If the Memorandum i…

1. The Company's MOA and any amendment thereto shall become effective after being registered in the commercial register with the Competent Authority. 2. If the MOA is not registered as required by Clause [1] of this Arti…

1. A company may, by a special resolution of the General Assembly or with the approval of the absolute majority of the partners, transfer its registration in the Trade Register from one Competent Authority to another, wh…

1. Any third party may prove the existence of the MOA of the Company or any amendment thereto by all means of proof. Such third party may invoke the existence or invalidity of the Company vis-à-vis the partners. 2. If th…

1. The capital of the Company shall consist of cash contributions and in-kind contributions with an appraised value, or either of them. 2. The partner's contribution may not take the form of work unless the partner is jo…

1. If the partner's contribution is a title to property or any other right in-rem transferred to the Company, such partner shall be liable in accordance with the provisions applicable to contracts of sale with regard to …

1. If the partner undertakes to contribute to the company a sum of money, and such sum is not paid, or if the contribution consists of debts of third parties that are not settled, such partner shall be liable vis-a-vis t…

1. The creditor of any partner may not satisfy his right from the contribution of his debtor to the capital of the Company, but rather, he may satisfy the same from his debtor's profit share. If the Company is dissolved,…

1. The Company shall, as of the date of registration in the commercial register with the Competent Authority, acquire the legal personality in accordance with the provisions of this Decree Law and the resolutions issued …

The person authorized to manage the Company shall preserve its rights and shall exercise due care and diligence for the benefit of the Company as expected from a Prudent Person. Such person shall perform all such acts th…

The Company shall be bound by any act or thing carried out by the person authorized to manage the Company in the ordinary course of such management. The Company shall also be bound by any act of any of its employees or a…

Subject to the provisions of this Decree Law, any provision of the MOA or AOA of the Company authorizing it or any of its subsidiaries to agree on relieving any person from any personal liability, which such person assum…

1. The Company may not deny its liability vis-à-vis any client on the grounds that the authorized manager is not duly appointed in accordance with the provisions of this Decree Law or the AOA of the Company, as long as t…

1. Every Company shall keep accounting records of its transactions to give a clear picture of its financial position at any specific point in time, and to enable the partners or shareholders to verify that the Company's …

1. Every joint stock company and limited liability company shall have one or more auditors to carry out an annual audit of its accounts. Other companies may appoint an auditor in accordance with the provisions of this De…

1. Every Company shall have a fiscal year to be specified in its Articles of Association, provided that the first fiscal year of the Company shall be between 6 [six] to 18 [eighteen] months, starting from the date on whi…

1. If the Company's MOA does not define a partner's share in the profits or losses, the latter's share shall be proportional to his capital contribution. If the MOA only specifies a partner's share in profits, his share …

1. No fictitious profits may be distributed to the partners or shareholders. The board of directors or any similar body shall be liable vis-à-vis the partners or shareholders and the Company's creditors for any such arra…

Subject to the provisions of Article [4] of this Decree Law, only the joint stock company may issue negotiable shares, bonds or Sukuk.

1. No company, other than the public joint stock company, may conduct a public offering of Securities. Under no circumstances may any company, entity, or natural or legal person incorporated or registered in the State, i…

The Minister shall, in coordination with the Competent Authority, issue regulations on the activities of the Registrar.

The Competent Authority shall notify the Registrar of the details of the companies registered with it. Such notification shall include the company's name, business activities, capital, business license as well as any inf…

The Competent Authorities shall establish the necessary rules for registration of trade names, shall ensure that the trade names of companies are not confusingly similar, and shall provide the Registrar with any updates …

The Minister shall issue a resolution: 1. Designating the period of time for which the Registrar shall keep the documents, so that such documents may be destroyed after the expiration of such period. 2. Regulating the su…

Subject to the provisions of this Decree Law, the stakeholders may request from the Registrar: 1. A copy of the details of the records kept by the Registrar. 2. A certificate from the Registrar or the Competent Authority…

Based upon the proposal of the Minister and in coordination with the Ministry of Finance, the Cabinet shall issue a resolution determining the fees payable by companies for the services provided by the Ministry and the S…

A General Partnership is a Company which consists of two or more partners who are natural persons and are jointly and severally liable to the extent of all their property for the liabilities of the Company.

A general partner shall have the capacity of a trader. Such partner shall be deemed to conduct the business in person in the name of the Company. When a General Partnership becomes bankrupt, all the partners thereof shal…

1. The name of a General Partnership shall consist of the name[s] of one or more partners in addition to the words "and partners" or words of similar meaning, provided that the name of the Company ends with the words "Ge…

1. The General Partnership's MOA shall, in particular, include the following details: a. The full name of each partner and his nationality, date of birth and place of residence; b. The name, address and trade name, if an…

The General Partnership shall be incorporated and registered as follows: 1. The Competent Authority shall determine the information and documents required for the incorporation of the Company, and shall create a standard…

The General Partnership shall keep the following items at its headquarters: 1. A register containing the names and addresses of the partners; 2. A copy of the MOA of the Company and any amendments thereto; 3. A statement…

1. The General Partnership shall be managed by all the partners. Every partner in a General Partnership shall act as an agent of both the Company and other partners in respect of the business of the Company, unless the m…

1. The general partner may not, without the written consent of the other partners, carry on for his own benefit or for the benefit of third parties any activity which competes with the business of the Company, nor be a g…

1. Where the manager is a partner appointed under the MOA of the Company, he may only be removed with the unanimous consent of the other partners or pursuant to a judgment by the competent court. 2. If the manager is a p…

The manager, whether a partner or not, may resign from the management, provided that he serves upon the partners a 60-day prior notice of resignation, unless his appointment contract provides otherwise, failing which, he…

The manager shall not act beyond the scope of regular management duties except with the consent all the partners or by virtue of an explicit provision in the MOA. This prohibition shall apply to the following acts in par…

1. The manager may not enter into any contracts for his own benefit or for the benefit of any of his relatives up to the second degree with the Company without the written permission of all the partners to be granted on …

The manager shall be liable for the damage sustained by the Company, the partners or third parties due to any breach of the provisions of the MOA of the Company or of the appointment contract of the manager, or any negli…

1. Where there is more than one manager and each of whom is assigned particular responsibilities, each manager shall be liable vis-à-vis the partners only for those acts which fall within his areas of responsibility. Whe…

The General Partnership shall be liable vis-à-vis third parties to indemnify the damage arising from the acts of any partner carried out with the consent of the other partners or in the normal course of business of the C…

Where a partner joins the Company, he shall be jointly liable with the other partners to the extent of all his own property for all of the Company's existing obligations, provided that the Company has already disclosed s…

1. Unless the MOA of the Company stipulates otherwise, any partner may withdraw from a General Partnership under a written agreement with the other partners. In the absence of such agreement, the partner may file a case …

1. Equity stakes may only be transferred in a General Partnership with the consent of all the partners, subject to the conditions set out in the MOA of the Company. The assignee shall become a partner in the Company afte…

Unless the partners agree otherwise, the amount payable by the remaining partners in respect of the equity stake of the deceased partner shall be a debt payable of the date of dissolution of the General Partnership or of…

1. The rights and obligations of the partners in a General Partnership shall survive if the Company continues to operate upon the expiry of its term or the fulfillment of the objects for which it is established. 2. If a …

Without prejudice to the provisions of the MOA of the General Partnership, the following obligations shall be observed: 1. The Company shall pay any amounts the partner has personally paid on behalf of the Company to ena…

Liabilities of the Company may only be enforced against the property of its partner after obtaining a Writ of Execution against the Company when the debt has not been satisfied after giving the Company notice to pay. The…

1. The profits, losses and the partner's shares therein shall be determined at the end of the Company's fiscal year in light of the balance sheet and the profit and loss account. 2. Each partner shall be considered a cre…

A Limited Partnership is a Company which consists of one or more General Partners who are jointly and severally liable for the obligations of the Company and act in the capacity of a trader, in addition to one or more Li…

Any natural person or legal person may be a Limited Partner in a Limited Partnership.

1. The name of a Limited Partnership shall consist of the name of one or more of the General Partners in addition to the legal form of the Company. In addition, the Company may have its own trade name. 2. The name of a L…

1. The provisions relating to General Partnerships shall also apply to Limited Partnerships, subject to the provisions of this Chapter in respect of the Limited Partner. 2. The MOA of a Limited Partnership shall include …

The Company shall be managed only by the General Partners. Resolutions shall be passed unanimously by the General Partners, unless the Company's MOA provides for a majority. No change in the nature of the business of the…

1. The General Partner of a Limited Partnership shall have all the rights and powers of any partner of a General Partnership, and shall be subject to all the conditions, restrictions and obligations imposed on the partne…

1. A Limited Partner shall have the same rights of a General Partner in relation to: a. Lending money to, and entering into transactions with, the Company, subject to the consent of all General Partners; b. Getting acces…

1. A Limited Partner may not get involved in the management activities related to third parties, but may demand a copy of the profit and loss account and the balance sheet, and may verify, either in person or by a proxy …

A Limited Partner may only assign his share in the Company to a third party, in whole or in part, with the consent of all the partners or as provided for in the MOA of the Company. The assignee shall become a partner of …

1. A limited liability company is a company whose number of partners is at least two and does not exceed fifty [50]. Any partner thereof shall be liable only to the extent of his capital contribution. 2. Any single natur…

1. A limited liability company shall have a name derived from its objective or from the name of one or more of its partners, provided that the name of the company shall be followed by the expression "Limited Liability Co…

1. The limited liability company shall be incorporated as set forth in Articles [42] and [43] of this Decree Law. 2. The MOA shall include the methods for settling the disputes that arise out of the business affairs of t…

1. The Company shall keep at its headquarters a special register of partners, which shall include the following details: a. Full name, nationality, date of birth and place of residence of every partner, and, if the partn…

1. If, at any time after the incorporation of the Company, the number of partners increases above the limit set in Article [71] of this Decree Law, the manager or managers, as the case may be, shall notify the Competent …

1. The Company shall have sufficient capital to achieve the object of its incorporation consisting of stakes of equal value. Upon the proposal of the Minister in coordination with the Competent Authorities, the Cabinet m…

A partner's stake shall be indivisible. If such stake is held by several persons and none of whom has been appointed to act as their designated representative before the Company, the person whose name appears first in th…

1. Partners in a Limited Liability Company may provide in-kind contributions in exchange for their stakes. 2. The in-kind contributions shall be valued at the expense of their contributors by one or more valuators; other…

1. Any partner may assign or pledge his stake in the Company to any other partner or to a third party. Such assignment or pledge shall be made in accordance with the terms of the MOA of the Company under a formal instrum…

1. If a partner wishes to assign his stake to a non-partner of the company, with or without compensation, such partner shall notify the other partners through the manager of the Company of the assignee or purchaser and t…

If the creditor of a partners institutes enforcement proceedings against the equity stake of his debtor, he may agree with both the debtor and the Company on the method and terms of sale. Otherwise, the stake shall be of…

The partner of a limited liability company shall be held liable vis-à-vis the company for any of the latter's property held by such partner in a fiduciary capacity, or for any profits or benefit gained by him through the…

1. The management of a limited liability Company shall be entrusted to one or more managers as determined by the partners in the MOA. Such managers shall be selected from among the partners or from third parties. If mana…

1. Every manager of the Limited Liability Company shall be held liable vis-à-vis the Company, the partners and third parties for any fraudulent acts committed by such manager. He shall also be liable for any losses or ex…

1. Unless otherwise provided in the Company’s MOA or in the appointment contract, the manager shall be dismissed by a resolution of the General Assembly, whether the manager is a partner or not. The court may also dismis…

The manager may not, without the consent of the General Assembly of the Company, manage a competing company or a company with objects similar to those of the Company or make, for his own benefit or for the benefit of thi…

The manager of the Company shall prepare the annual balance sheet and profit and loss account, shall also prepare an annual report on the activities and financial position of the Company, and shall provide his recommenda…

1. If the number of the partners exceeds fifteen [15], the partners shall appoint a supervisory board consisting of at least three partners. They shall be appointed for a [3] three-year term of office beginning on the is…

The supervisory board shall be authorized to scrutinize and examine the books and records of the Company and to require the managers at any time to provide a report on their management activities. The supervisory board s…

Members of the supervisory board shall only be held liable for the acts of the managers if such members are aware of the errors committed and fail to mention them in their report submitted to the General Assembly of Part…

Partners who are not managers of a Limited Liability Company with no supervisory board shall have all the rights associated with the description of the partners provided for in this Decree Law or in the MOA. Any agreemen…

1. The limited liability company shall have a General Assembly made up of all the partners. The General Assembly shall be convened by a call of the manager or the board of directors at least once in the year during the f…

1. With exception of the General Assembly Meeting being postponed due to the lack of quorum in accordance with the provisions of Article [96] of this Decree Law, a call for the General Assembly meeting shall be served ac…

The General Assembly of a Limited Liability Company shall, at its annual meeting, consider and decide on the following issues: 1. The managers' report on the activities and financial position of the Company during the pr…

Irrespective of the number of shares held by him, each partner shall have the right to attend the General Assembly Meeting either in person or through delegating under special authorization any other non-managing partner…

1. Unless the company's MOA determines a higher percentage, the quorum for a valid meeting of the General Assembly shall be the attendance of partners who hold at least [50%] of the shares of the company's capital, subje…

The General Assembly may not deliberate on issues that are not listed in the agenda, unless serious issues that require consideration arise during the meeting. If, at the start of the meeting, a partner requests that a c…

Each partner shall have the right to discuss the issues listed in the agenda. The managers shall be required to respond to the queries of partners to the extent that no harm is likely to be occur to the interests of the …

A managing partner may not vote on resolutions to discharge himself from liability for management.