Saudi Arabia – Key Changes of the New Saudi Companies Law

Paragraphs (1, 2) of Article (17)

1. A company shall maintain accounting records and supporting documents relating to its business, contracts and financial statements at the company’s head office or at any other location specified by the company’s manager or board of directors.
2. A company’s financial statements shall be prepared by the end of each fiscal year in accordance with the accounting standards approved in the Kingdom, and said statements shall be deposited as provided for in the Implementing Regulations within (six) months from the date on which the fiscal year ends, in accordance with the NCL’s provisions.

With respect to Public Joint Stock Companies:

Filing of the Company’s financial statements, Board’s report and external auditor’s report shall be in accordance with the provisions related to the disclosure of financial statements and Board’s report in the Rules on the Offer of Securities and Continuing Obligations.

With respect to other types of companies:

The Company’s manager or the chairman of the board shall deposit the financial statements and the external auditor’s report (if applicable) with the Saudi Business Center through electronic method. The Chairman shall also provide the Ministry of Commerce with a copy of the board report at least (twenty-one) days prior to the date set for the annual OGA meeting.

A company’s manager or board member shall exercise duty of care and duty of loyalty, particularly in:

1. carrying out his duties within the scope of his powers;
2. acting in the interest of the company and promoting its success;
3. making decisions or voting independently thereon;
4. exercising reasonable and expected due diligence, skill, and care;
5. avoiding conflict of interest;
6. disclosing any direct or indirect interest he has in the transactions conducted and the contracts concluded for the company’s account; and
7. not accepting any benefit granted thereto by third parties in relation to his role in the company.

The Implementing Regulations shall determine the provisions related to this Article.

With respect to Public Joint Stock Companies:

1. Duty to act within conferred powers: A member of the Board shall perform and exercise his/her duties and powers in managing the Company and guiding its activities within his/her conferred powers in accordance with the Companies Law and its implementing regulations and the Company’s bylaws and other relevant laws, and only exercise powers for the purposes for which they were conferred.
2. Duty to act for the best interest of the Company and to promote its success: A member of the Board shall comply with the following: 1) working in good faith for the best interest of the Company and all its shareholders and shall not prioritise his/her personal interests over the interest of the Company and its shareholders, and in doing so shall have regard to the rights of the other stakeholders; 2) ensure exerting all efforts to promote the success and growth of the Company and maximise its value on the long term for the benefit of its shareholders.
3. Duty to exercise independent judgment: A member of the Board shall perform his/her duties objectively and independently in relation to managing the Company and making decisions, and shall avoid cases that affect his/her independence in making decisions or voting on them.
4. Duty to exercise reasonable and expected care, skill and diligence: A member of the Board shall perform his/her duties and responsibilities in accordance with the Companies Law, the Capital Market Law and their implementing regulations and the Company’s bylaws and other relevant laws, and in accordance with the diligence and care that should be exercised by a diligent person with the general knowledge, skill and experience that the member of the Board has and that are expected of a person carrying out the functions carried out by the member of the Board.
5. Duty to avoid conflict of interest: A member of the Board shall avoid transactions and situations in which he/she has actual or potential direct or indirect interest that conflicts or may conflict with the Company’s interest, and the member of the Board shall comply with the provisions relating to conflicts of interest in the Companies Law and its implementing regulations.
6. Duty to disclose any direct or indirect interest in businesses and contracts executed for the Company’s account: A member of the Board shall disclose any direct or indirect interest he/she has in the business and contracts executed for the Company’s account immediately upon becoming aware thereof, and shall comply with the provisions relating to disclosure of interest in business and contracts in the Companies Law and its implementing regulations.
7. Duty not to accept benefits from third parties in relation to his/her role in the company: A member of the Board shall not exploit his position, duties and powers vested in him/her in his/her capacity as a board member in any way to obtain or accept benefits from third parties for a specific act or to refrain from doing a specific act.

With respect to other types of companies:

Similar explanatory provisions above apply, except that any reference to CMA law and its implementing regulations must be removed.

1. Neither the company’s manager nor board member may have any direct or indirect interest in the transactions conducted and contracts concluded for the company’s account without the authorization of the partners, general assembly, or shareholders or their designees.
2. Neither the company’s manager nor board member may engage in any business that may compete with the company or with any of its activities without the authorization of the partners, general assembly, or shareholders or their designees.
3. Neither the company’s manager nor board member may exploit the company’s assets or information or any investment opportunity offered to the company or to him/her in his/her capacity as a manager or board member for his benefit whether directly or indirectly.
4. The Implementing Regulations shall specify the rules necessary for the implementation of paragraphs (1), (2), and (3) of this Article.
5. Paragraph (1) of this Article shall not apply to the following:
   1. Transactions conducted and contracts concluded pursuant to public tenders.
   2. Transactions and contracts that aim to meet personal needs if they are carried out under the same terms and conditions the company applies to all persons and contractors it deals with and are within the company’s regular activities.
   3. any other transactions or contracts specified by the Implementing Regulations which are not inconsistent with the company’s interest.
6. If the company’s manager or a board member violates Paragraph (1) of this Article, the company may petition the competent judicial authority to invalidate the contract and order him/her to return any profit or benefits realized from such violation.
7. If the company’s manager or a board member violates paragraph (2) of this Article, the company may petition the competent judicial authority for appropriate compensation.

1. The authorization delegation shall be in accordance with the following conditions:

1. 1. The total amount of business or contract -or the total of the businesses and contracts during the fiscal year- is less than (1%) of the Company’s revenues according to the latest audited financial statements and less than 10 million Saudi Riyals.
   2. The business or contract falls within the normal course of the Company’s business.
   3. The business or contract shall not include preferential terms to the Board members and shall be in accordance with the same terms and conditions followed by the Company with all contractors and dealers.
   4. The business or contract shall not be part of the consultation businesses and contracts which a Board member carries out by a professional license for the Company.
2. The Board member shall be responsible for calculating the transaction, stipulated in sub-paragraph (1) of paragraph (a) of this Article, in which he has a direct or indirect interest during the same fiscal year.
3. The Ordinary General Assembly [OGA] shall have the right to delegate the authorisation powers stipulated in paragraph (2) of Article (27) of the Companies Law to the Board, provided that the resolution of that General Assembly specifies the competing businesses and activities that delegated Board may authorize during the delegation period.
4. The period for the delegation shall be a maximum of one year from the date of approval by the General Assembly to delegate its powers, stipulated in paragraph (1) and (2) of Article (27) of the Companies Law, to the Company’s Board, or until the end of the term of the delegated Board, whichever is earlier.
5. Any member of the Board shall not be allowed to vote on the items of delegation and the revocation in the OGA.
6. Any member of the Board shall not be allowed to vote on the resolution taken by the General Assembly or the delegated Board with respect to businesses and contracts that are executed for the Company’s account if he/she has a direct or indirect interest therein or in engaging in a business that may compete with the Company or any of its activities.
7. The OGA shall have the right to add additional terms to the terms stated in this Article,

With respect to other types of companies:

The implementing regulations specified the necessary requirements to implement the paragraph (3) of this Article as follows:
An investment opportunity must falls within the normal course of the Company’s business Or if the company desires to benefit from this opportunity or is expected that she desires this.
Regarding paragraphs (1) and (2) of this Article, similar explanatory provisions above apply except that any reference to CMA law and its implementing regulations must be removed.

1. has no personal interest in the subject matter of the decision;
2. understands and is familiar with the subject matter of the decision to an extent he/she deems reasonable according to the circumstances of the decision; and
3. believes firmly and rationally that the decision serves the company’s interests.

The burden of proving otherwise shall rest with the plaintiff. For the purposes of this Article, a decision shall refer to an action or omission relating to the company’s business.

The company’s bylaws shall specify the manner by which membership of the Board may end or in which it may be terminated upon a request from the Board. The OGA may, however, remove some or all Board members, even if the Company’s bylaws provides otherwise.

In such case, the OGA shall elect a new board of directors or a replacement for the removed member – as the case may be – in accordance with the provisions of the NCL.

The Competent Authority may specify the rules governing the removal of board members by the OGA.

With respect to Public Joint Stock Companies:

Directors removal in Public Joint Stock Companies (PJSCs) shall be implemented with consideration to any rules set out by the CMA. It should be noted that upon the end of the membership of a Board member by any way, the Company shall immediately notify the CMA and the Exchange (Tadawul) and shall specify the reasons thereof.
Upon receiving a request from one or more shareholders representing (10%) of the Company’s voting shares for removal of some or all Board members in accordance with the Companies Law, the Board shall include, in the invitation to convene the OGA, the name of the shareholder who submitted the request and the justifications of such request. The concerned Board member shall have the right to make a statement regarding the request in the relevant OGA meeting.
Similar explanatory provisions above apply on Closed Joint Stock Companies (CJSCs) except that any reference to CMA and Exchange (Tadawul) shall be replaced by the Ministry of Commerce.

1. The board of directors shall call the OGA to convene in ample time prior to the expiration of the board’s term , to elect a board of directors for a new term. If the election cannot be held and the term of the current Board expires, its members shall continue to perform their duties until a board of directors is elected for a new term, provided that they do not continue to carry out their duties beyond the period specified in the Implementing Regulations.
2. If the chairman and members of the board resign, they shall call for an OGA meeting to elect a new board, such resignation shall not take effect until a new board is elected, provided that the resigning board does not continue to carry out its duties beyond the period specified in the Implementing Regulations.
3. A board member may resign pursuant to a written notice submitted to the chairman of the board. If the chairman of the board resigns, the notice shall be submitted to the remaining members of the board and the board’s secretary. In both cases, the resignation shall take effect from the date specified in the notice.
4. Unless the company’s bylaws stipulate otherwise, if the position of a member of the board of directors of a joint-stock company becomes vacant due to his/her death or resignation, and if the minimum number of members required for the validity of board meetings as stipulated in this Law or the company’s bylaws is not affected by such vacancy, the board may appoint a qualified person with relevant expertise to provisionally fill the vacancy. The appointment shall be reported to the Commercial Register, and to the CMA if the company is listed in the capital market, within (fifteen) days from the date of such appointment, and it shall be submitted to the OGA in its first meeting. The appointed member shall complete the term of his/her predecessor.
5. If the number of board members falls below the minimum number required for the validity of board meetings as stipulated in the NCL or its bylaws, the remaining members must call for an OGA meeting within (sixty) days to elect the required number of members.
6. If the board of directors is not elected for a new term or if the required number of board members is not satisfied, in accordance with paragraphs (1), (2) and (5) of this Article, any person with interest may petition the competent judicial authority to appoint qualified persons with expertise, and in the appropriate number, to oversee the management of the company and call on the general assembly to convene within (ninety) days to elect a new board of directors or appoint board members to satisfy the required number, as the case may be, or may petition the competent judicial authority to dissolve the company.

With respect to Public Joint Stock Companies:

The implementing regulations specified the necessary requirements to implement the paragraphs (1) and (2) of this Article as follows:

In the event of failure to elect a Board for a new term and the term of the current Board has lapsed, the members of such Board shall continue to perform their duties until a new Board is elected, provided that the period of such continuation of the lapsed Board does not exceed (90) days from the end date of the Board’s term. And the Board shall undertake all necessary procedures to elect a new replacement Board before the expiry of the period specified in this paragraph.

In the event that the chairman and members of the Board resign, they shall call for the OGA meeting to convene in order to elect a new Board, and such resignation shall not be effective until a new Board is elected, provided that the period of such continuation of the resigned Board does not exceed (120) days from the date of such resignation. And the Board shall undertake all necessary procedures to elect a new replacement Board before the expiry of the period specified in this paragraph.

Similar explanatory provisions above apply on Closed Joint Stock Companies (CJSCs).

1. Without prejudice to the provision of Article (27) of the NCL, a board member shall immediately disclose to the board of directors any direct or indirect interest he/she may have in the company transactions and contracts. Such disclosure shall be recorded in the minutes of the board meeting. Said member may not vote on a resolution by the board of directors and the general assemblies relating to such transactions and contracts. The board shall notify the general assembly, when it convenes, of the transactions and contracts in which such member has direct or indirect interest; the notice shall be accompanied with a special report prepared by the company auditor in accordance with auditing standards approved in the Kingdom.
2. If a board member fails to disclose his/her interest as provided for in paragraph (1) of this Article, the company or any person with interest may petition the competent judicial authority to invalidate the contract or obligate the member to return any profit or benefit realized therefrom.
3. Liability for damages arising from the transactions and contracts referred to in paragraph (1) of this Article shall be borne by the board member having interest in such transactions or contracts; liability shall also be borne by other board members for their omission or negligence in the performance of their duties in violation of said paragraph, or if it is established that the transactions and contracts are unfair or involve a conflict of interest and shareholders sustain damage therefrom.
4. Board members who object to the decision shall not be liable if their objection is explicitly recorded in the meeting minutes. Absence from the meeting at which the decision is issued shall not exempt the absentee from liability, unless it is proven that he/she was not aware of the decision or was unable to object to it after becoming aware thereof.

1. The board of directors of a joint-stock company shall convene no less than four meetings per year upon a call by its chairman, as stipulated in the company’s bylaws. The Competent Authority may amend the minimum number of meetings provided for in this paragraph. The chairman shall call for a board meeting to discuss one or more matters if requested in writing by a board member.
2. Board meetings shall only be valid if attended by at least half of the members, whether in person or by proxy, unless the company’s bylaws stipulate a higher percentage.
3. Board decisions shall be passed by the majority vote of attending members, whether in person or by proxy, and the chairman of the meeting shall, in case of a tie, have the casting vote, unless the company’s bylaws stipulate otherwise.
4. The board of directors shall determine the location of its meetings, and may hold its meetings through means of technology.

1. A member of the board of directors of a joint-stock company may not attend meetings nor vote on board decisions by proxy. As an exception, he may designate another board member to act as his proxy if stipulated in the company’s bylaws, provided that the designated member does not act as proxy for more than one member.
2. A board decision shall become effective on the date of its issuance, unless the decision provides for a specific date or condition for its effectiveness.

1. The OGA shall hold its annual meeting at least once during the (six) month period following the end of the company’s fiscal year. Other OGA meetings may be held as necessary.
2. The agenda of the annual meeting of the OGA shall include the following items:
   1. Reviewing and discussing the board of directors’ report for the ending fiscal year.
   2. Reviewing the financial statements of the ending fiscal year.
   3. Reviewing the auditor’s report for the ending fiscal year, if any, and making a decision thereon.
   4. Deciding on board proposals relating to the distribution of dividends, if any.
3. The condition for holding the annual meeting of the OGA shall be deemed satisfied if an extraordinary general assembly convenes during the (six) month period following the end of the company’s fiscal year if its agenda includes the items stated in paragraph (2) of this Article.

1. General and special assemblies shall convene upon a call by the board of directors, in accordance with the conditions stipulated in the company’s bylaws. The board of directors shall call for an OGA meeting within (thirty) days if requested by the auditor or by a shareholder, or more, representing at least (ten percent) of the company’s voting shares. If the board fails to call for a general assembly meeting within (thirty) days from the date of the auditor’s request, the auditor may call for such meeting.
2. The request referred to in paragraph (1) of this Article shall indicate the items on which shareholders are required to vote.
3. The Competent Authority may call for an OGA meeting in the following cases:
   1. If the period specified for the OGA meeting, as provided for in Article 88(1), lapses without holding a meeting.
   2. If it is established that the provisions of the NCL or the company’s bylaws are violated or that there is a fault in the company’s management, including cases in which the number of board members falls below the minimum number required for the validity of board meetings.
   3. If the board of directors fails to call for an OGA meeting within the period specified in paragraph (1) of this Article from the date of the auditor’s request or the request of a shareholder, or more, representing at least (ten percent) of the company’s voting shares.

The Competent Authority may take the measures necessary for holding the OGA and it may chair the assembly meeting if the meeting cannot be chaired in accordance with Article 84(1) of the NCL.

1. The call for an assembly meeting shall be made at least (twenty-one) days prior to the date set for the meeting in accordance with the rules specified in the Implementing Regulations, provided that:
   1. shareholders are notified of the meeting by registered mail sent to the addresses registered in the shareholders’ register, or by an announcement using means of technology; and
   2. a copy of the invitation and the meeting agenda are sent to the Commercial Register, and to the CMA if the company is listed in the capital market at the time of the announcement.
2. The invitation for the assembly meeting shall include at least the following:
   1. A statement defining those with the right to attend the meeting and their right to designate persons other than board members to act as their proxy; a statement of a shareholder’s right to discuss items on the meeting agenda and direct questions as well as the manner of exercising the right to vote.
   2. Meeting venue, date, and time.
   3. Type of assembly, whether general or special.
   4. Meeting agenda, including the items on which shareholders are required to vote.
3. Shareholders of an unlisted joint-stock company representing all of the company’s voting shares may hold a general assembly meeting without adhering to the conditions and periods prescribed for calling for meetings to review matters the decisions on which fall within the powers of the general assembly.

With respect to Public Joint Stock Companies:
The implementing regulations specified the necessary requirements to implement the paragraphs (1) of this Article as follows:
the Company’s board of directors may send General Assemblies and Special Assemblies meeting invitations through means of contemporary technology which shall indicate the invitation’s date and time and its content as well the identity of the sender and recipient.

1. Contemporary technology may be used to allow the shareholders to participate in General Assembly and Special Assembly meetings and their deliberation, review agendas of such meetings and related documents, in accordance with the following rules:
   1.  the shareholders’ participation at the General and Special Assembly must be through instant video and audio transmission;
   2. the participation must be through a live connection between the Company and the shareholders, in a way that enables the shareholder to actively and instantaneously participate in the General Assembly and Special Assembly, and to listen to and follow presentations, present opinions and discuss and vote on resolutions;
2. A Company must allow shareholders to vote on the agenda of the General and Special assembly meetings electronically, even if they did not attend those meetings, in accordance with the following rules:
   1. electronic voting must allow shareholders to cast their votes, whether before or during the General Assembly and Special Assembly meeting, without the need to appoint a proxy to attend such meetings on their behalf; and
   2. The electronic voting on the agenda items of any General Assembly and Special Assembly meeting commences after the date of publishing the meeting’s invitation, provided that such period shall not be less than three (3) days prior to the date of the meeting. The electronic voting on any item of the meeting agenda shall stop when the discussion and the voting on the item are concluded in that General or Special Assembly.

If contemporary technology is used in General Assembly or Special Assembly meetings, the Board must establish the rules and guidelines for checking the identity of the shareholder who votes electronically and the shareholder who participates in General Assembly and Special Assembly meetings through contemporary technology; the Board shall also verify the eligibility of each shareholder to vote on any of the meeting’s agenda items.
The attendance and votes of shareholders who participate in General Assemblies and Special Assemblies meetings by means of contemporary technology and shareholders who vote electronically are counted towards the quorum required for a validly held meeting of the General Assemblies and Special Assemblies.

Similar explanatory provisions above apply on Closed Joint Stock Companies (CJSCs).

1. An OGA meeting shall be deemed valid only if attended by shareholders who represent at least a quarter of the company’s voting shares, unless the company’s bylaws stipulate a higher percentage, provided that such percentage does not exceed half of the voting shares.
2. If the quorum required for an OGA meeting is not satisfied as stipulated in paragraph (1) of this Article, a call shall be made for a second meeting to be held under the same conditions stipulated in Article (91) of NCL within (thirty) days following the date set for the first meeting. The second meeting may be held one hour after the end of the period set for the first meeting, provided this is permitted by the company’s bylaws and the invitation for the first meeting provides for the possibility of holding a second meeting. In all cases, the second meeting shall be deemed valid regardless of the number of voting shares represented therein.
3. Decisions of an OGA meeting shall be passed by the majority vote of voting rights represented therein.

1. An EGA meeting shall be deemed valid only if attended by shareholders who represent at least (half) of the company’s voting shares, unless the company’s bylaws stipulate a higher percentage, provided that such percentage does not exceed (two-thirds) of the voting shares.
2. If the quorum required for EGA meeting is not satisfied as stipulated in paragraph (1) of this Article, a call shall be made for a second meeting to be held under the same conditions stipulated in Article 91 of the NCL. The second meeting may be held one hour after the end of the period set for the first meeting, provided that the invitation for the first meeting provides for the possibility of holding a second meeting. In all cases, the second meeting shall be deemed valid if attended by shareholders who represent at least a (quarter) of the company’s voting shares.
3. If the quorum required for the second meeting is not satisfied, a call shall be made for a third meeting to be held under the same conditions stipulated in Article 91 of the NCL. The third meeting shall be deemed valid regardless of the number of voting shares represented therein.
4. Decisions of an EGA meeting shall be passed by the vote of (two-thirds) of the voting shares represented therein. Decisions relating to the increase or decrease of capital, extension of the company’s term, dissolution of the company prior to the expiry of the term specified in its bylaws, merger of the company with another company, or division of the company into two companies or more shall be deemed valid only if made by the vote of (three-quarters) of the voting shares represented in the meeting.
5. Decisions of the EGA which are required to be registered with the Commercial Register as prescribed by the Implementing Regulations shall be registered therewith by the board of directors within (fifteen) days from their issuance date.

1. The board of directors shall, when preparing the agenda of the general assembly, take into consideration the matters that shareholders wish to include. A shareholder, or more, representing at least (ten percent) of the company’s voting shares may add an item, or more, to the agenda during its preparation; the competent authority may amend said percentage.
2. The board of directors shall list each matter included in the general assembly’s agenda as an independent item. The board shall not combine fundamentally distinct matters under one item, nor shall it include under one item the transactions and contracts in which any board member has a direct or indirect interest for the purpose of voting on the whole item.
3. Any shareholder may discuss the items included on the agenda of the general assembly and direct related questions to board members and the auditor. Any provision to the contrary in the company’s bylaws shall be deemed null and void. The board of directors or the auditor shall answer the questions of shareholders to the extent that does not undermine the company’s interests. If a shareholder is not satisfied with the response to his question, he/she may request the general assembly to decide thereon and its decision shall be final.

With respect to Public Joint Stock Companies:

Filing of the Company’s financial statements, Board’s report and external auditor’s report shall be in accordance with the provisions related to the disclosure of financial statements and Board’s report in the Rules on the Offer of Securities and Continuing Obligations.

With respect to Closed Joint Stock companies:

The Company’s manager or the chairman of the board shall deposit the financial statements and the external auditor’s report (if applicable) with the Saudi Business Center through electronic method.
The Chairman shall also provide the Ministry of Commerce with a copy of the board report at least (twenty-one) days prior to the date set for the annual OGA meeting.

1. The partners may remove the manager, or managers in case of multiple managers, whether appointed in the company’s AoA or in a separate contract; in such case, the partners shall appoint a new manager to replace the removed manager. If the manager is a partner in the company, he may not vote on the decision relating to his removal.
2. A partner, or more, representing at least (one-fourth) of the company’s capital may petition the competent judicial authority to remove the manager or managers, as the case may be.

1. If the holding company is a partner or shareholder in the subsidiary company and owns interests or shares in its capital that grants it the majority of voting rights therein.
2. If the holding company is a partner or shareholder solely controlling the appointment of the manager or the majority of board members, or if it has the power to remove the manager or the majority of board members.
3. If the holding company is a partner or shareholder solely controlling the majority of the voting rights pursuant to an agreement with the other partners or shareholders.
4. If the subsidiary company is affiliated with a subsidiary of the holding company.

1. A subsidiary company may not acquire interests or shares in a holding company. Any action resulting in the transfer the ownership of interests or shares from a holding company to a subsidiary company shall be deemed null and void.
2. If a subsidiary company owns interests or shares in a holding company prior to becoming a subsidiary thereof, the following shall be observed:
   1. The subsidiary company may not make decisions in the holding company or vote on such decisions.
   2. The subsidiary company shall dispose of such interests or shares within (twelve) months from the date it becomes a subsidiary to the holding company. The Competent Authority may extend such period.
   3. The provisions of paragraphs (1) and (2) of this Article shall not apply to persons licensed under the Capital Market Law and its implementing regulations, if their ownership of interests or shares in a holding company falls within the scope of their regular activities. The Competent Authority may specify other cases that are excluded from the provision of this article.

1. Upon termination, a company shall enter into liquidation in accordance with the provisions of the NCL. The partners, the general assembly, or the shareholders shall initiate liquidation procedures and the company shall retain its legal personality to the extent necessary for liquidation.
2. If a company is terminated for any of the reasons stipulated in the NCL, the company’s partners, shareholders, managers, or board of directors – as the case may be – must prepare the statement referred to in Paragraph (1) of Article (242) of the NCL, unless such statement was prepared prior to the company’s termination and the date on which it was prepared does not exceed (thirty) days.
3. If a company is terminated and its assets are not sufficient to pay its debts or if it is in distressed under the Bankruptcy Law, it shall petition the competent judicial authority to initiate any liquidation proceedings under the Bankruptcy Law.
4. If a company is liquidated in violation of the provisions of this Article, the company’s partners, shareholders, manager or board members – as the case may be – shall be jointly and severally liable for any remaining debt owed thereby.
5. A public non-profit company may not be liquidated without obtaining the approval of the Ministry of Commerce.

1. A liquidator shall be appointed pursuant to a decision by the partners, general assembly, or shareholders subject to the conditions prescribed for amending the company’s AoA or bylaws as the company form, within a period not exceeding (sixty) days from the termination date of the company. If a liquidator is not appointed during said period, the competent judicial authority shall, upon a petition filed by any of the partners, shareholders or person with interest, appoint a liquidator.
2. Notwithstanding paragraph (1) of this Article, if the termination of the company is due to its dissolution or annulment pursuant to a final judgment, the liquidator shall be appointed by the judicial authority which rendered said judgment.
3. The competent judicial authority shall, prior to issuing the decision to appoint a liquidator in accordance with the provisions of paragraphs (1) and (2) of this Article, request the company’s partners, shareholders, managers of the company or its board of directors – as the case may be – to submit, within a period not exceed (thirty) days from the date of such request, the statement referred to in paragraph (1) of Article (two hundred forty two) of the NCL or the necessary data and records, or financial statements, if any, which establish that the company’s assets are sufficient to pay its debts by the end of the liquidation period as stipulated in this Part, and that the company is not distressed under the Bankruptcy Law. If the competent judicial authority finds that the company’s assets are not sufficient to pay its debts, it shall take the measures necessary to initiate any liquidation proceedings under the Bankruptcy Law.
4. In all cases, the decision to appoint a liquidator shall determine the liquidator’s powers, remuneration, and any imposed restrictions, as well as the period of liquidation.