The Company Articles of Association is a mandatory document required for establishing any company in Saudi Arabia. It serves as the constitutional foundation of the company, detailing its structure, governance, and operational framework in compliance with the Companies Law of 2015 and Shariah principles. This document is essential during company formation and continues to govern the relationship between shareholders, outline management responsibilities, and establish corporate governance procedures throughout the company's lifetime. It must be filed with the Ministry of Commerce and requires careful drafting to ensure compliance with local regulations while meeting the specific needs of the business venture. The Articles of Association becomes particularly crucial during significant corporate events such as capital changes, ownership transfers, or dispute resolution.
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1. Company Name and Parties: Details of the founding shareholders/partners and the official company name in Arabic and English
2. Definitions and Interpretation: Key terms used throughout the document and rules for interpretation
3. Company Type and Purpose: Legal form of the company and detailed description of business activities
4. Capital and Shares: Company's capital structure, share values, types, and distribution among shareholders
5. Share Transfer and Dealing Restrictions: Rules and procedures for transferring shares and any applicable restrictions
6. Management Structure: Composition and powers of the board of directors or managers
7. Shareholder Meetings: Procedures for general and extraordinary meetings, voting rights, and quorum requirements
8. Financial Affairs: Financial year, accounts, auditing requirements, and profit distribution
9. Reserved Matters: Decisions requiring special approval or higher voting thresholds
10. Duration and Termination: Company's term and conditions for dissolution or termination
1. Shariah Compliance: Specific provisions ensuring compliance with Islamic law principles, required for companies engaging in certain activities
2. Foreign Ownership Provisions: Special provisions required when foreign shareholders are involved
3. Preemptive Rights: Detailed procedures for existing shareholders' rights in new share issuances
4. Tag-Along and Drag-Along Rights: Special share transfer provisions for minority shareholder protection
5. Intellectual Property Rights: Provisions regarding ownership and use of intellectual property, important for technology companies
6. Non-Competition: Restrictions on shareholders' involvement in competing businesses
7. Deadlock Resolution: Procedures for resolving serious disagreements between shareholders
8. Committee Structure: Additional governance committees beyond the basic management structure
1. Schedule 1 - Shareholders Information: Detailed information about founding shareholders including ID numbers and contact details
2. Schedule 2 - Share Capital Distribution: Detailed breakdown of share ownership and classes of shares
3. Schedule 3 - Business Activities: Comprehensive list of licensed business activities as per Ministry of Commerce classifications
4. Schedule 4 - Board/Manager Powers: Detailed list of management powers and limitations
5. Schedule 5 - Reserved Matters List: Comprehensive list of decisions requiring special approval
6. Appendix A - Shareholders' Resolution Templates: Standard forms for shareholder resolutions
7. Appendix B - Share Transfer Forms: Template documents for share transfer procedures
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