Article 83 of the Saudi Implementing Regulations of the Bankruptcy Law

This article of the Regulations deals with the death of the debtor before an application to open a bankruptcy procedure is filed, and gives the heirs a specific route for dealing with the estate's debts.

Conditions for the article to apply:

1. The deceased must have been a bankrupt or distressed debtor.
2. The death must have occurred before an application to open a bankruptcy procedure was filed.
3. The heirs must agree with the creditors to form a company and transfer the estate's assets to it.

The rule: after this agreement, the heirs may apply to the court to open the bankruptcy procedure appropriate to that company. The article does not specify the type of procedure, leaving it to what suits the company's situation. The procedure here is understood according to the definition in Article 1 of the Regulations, as any of the bankruptcy procedures set out in Article 2 of the Law.

Note that agreement with the creditors is a condition that precedes the application; the text gives the heirs this route after the agreement.

It is followed by Article 84, which explains what happens to money that comes to the deceased debtor's estate after the company is formed: it is paid to that company unless the heirs and creditors agree otherwise. Before it comes Article 82, on the meeting of the deceased debtor's heirs and creditors.

Because this situation combines rules on estates, companies and bankruptcy, it is best for the heirs to consult a lawyer specializing in bankruptcy and commercial cases.