Article 119 of the Saudi Bankruptcy Law
المادة 119 من نظام الإفلاس · الفصل الخامس: إجراء التصفية: التوزيع على الدائنين
The article requires the trustee to return to the debtor whatever remains of the liquidation proceeds after all its debts are paid, and allows it, at the debtor's request, to ask to postpone ending the liquidation after the creditors are satisfied.
Official text (Arabic)
This article has not been amended since the law was issued.
1- يرد الأمين للمدين ما زاد من حصيلة التصفية بعد الوفاء بجميع ديونه، وفقاً لما تحدده اللائحة.
2- للأمين بعد استيفاء الدائنين لحقوقهم، بناء على طلب المدين التقدم بطلب إلى المحكمة لتأجيل إنهاء إجراء التصفية وفقاً لما تحدده اللائحة.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 119 explained in plain English
This article deals with a relatively rare but possible case: the liquidation proceeds are enough to pay all the debtor's debts and a surplus remains.
1- Returning the surplus: The trustee returns to the debtor whatever exceeds the liquidation proceeds after all its debts are paid, as the Implementing Regulations specify. Liquidation is a means of paying debts, not of stripping the debtor of what exceeds them.
2- Postponing the ending of the procedure: After the creditors have received their rights, the trustee, at the debtor's request, may apply to the court to postpone ending the liquidation procedure, as the Implementing Regulations specify.
Note that the request is made by the trustee to the court, but its initiative is based on the debtor's request, and its condition is that the creditors have received their rights. The article does not state the reasons for postponement or its length, and refers the details to the Implementing Regulations.
This article comes after Article 118, which allows non-cash bankruptcy estate assets to be distributed to creditors, and before Article 120, which makes jointly liable owners responsible for covering any shortfall in the bankruptcy estate assets if their proceeds are not enough to pay its debts; the surplus is returned only after all debts are paid. To assess a particular situation, consult a lawyer specializing in bankruptcy and commercial cases.
Practical example
The assets of a trader in Al-Ahsa in liquidation were sold for more than the total of his debts, so after all the creditors were paid an amount remained. The trustee returns this surplus to the trader as the Implementing Regulations specify, and if the trader asks, the trustee may apply to the court to postpone ending the liquidation procedure.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
How we write and review contentA question about Article 119 of Bankruptcy Law?
Describe what happened and specialist lawyers answer. You can write in English.
- Completely free
- Lawyers from the directory answer
- Your name stays hidden
Commercial & Corporate Law lawyers: ask a specialist about your case
Describe your situation briefly and we'll suggest a lawyer who specialises in this law
Commercial & Corporate Law lawyers
Lawyers who handle this kind of case
شركة امتداد النظام للمحاماة والاستشارات المهنية
- Labour & Employment Law
- Criminal Law
- Criminal Law
- Commercial & Corporate Law
Frequently asked questions about Article 119 of the Saudi Bankruptcy Law
What happens to money left over after a bankrupt's debts are paid?
The trustee returns it to the debtor after all its debts are paid, as the Implementing Regulations specify.
Can ending the liquidation procedure be postponed?
Yes. After the creditors have received their rights, the trustee, at the debtor's request, may ask the court to postpone ending the procedure, as the Implementing Regulations provide.
More articles on Liquidation of the Debtor's Assets
- Article 7
Article 7 bars the liquidation of any person under another law unless its assets cover all its debts and it is not defaulting, and makes management members jointly liable if this is violated.
1- مع مراعاة ما ورد في المادة (الرابعة) من النظام، لا يصفى أي شخص بموجب نظام آخر إلا إذا كانت أصوله تكفي لسداد جميع ديونه وكان غير متعثر. 2- إذا تم حل المدين وت
- Article 69
The debtor continues to manage its business during financial reorganization under the trustee's supervision, and at the trustee's request the court may remove its control in cases of negligence, mismanagement or criminal acts.
1- دون إخلال بصلاحيات ومهمات الأمين، يستمر المدين في إدارة أعماله ونشاطه خلال فترة إجراء إعادة التنظيم المالي تحت إشراف الأمين. 2- إذا ارتكب المدين أو أحد المسؤ
- Article 90
The court opens liquidation or administrative liquidation after financial restructuring ends if the debtor is distressed or bankrupt, the procedure's conditions are met, and the ending was for specified grounds.
تقضي المحكمة -من تلقاء نفسها أو بناء على طلب من ذي مصلحة- بافتتاح إجراء التصفية أو التصفية الإدارية إذا تحققت الشروط الآتية: أ - أن يكون المدين متعثراً أو مفلسا
- Article 92
The article allows the debtor, a creditor or the competent authority to ask the court to open the liquidation procedure if the debtor is distressed or bankrupt.
دون الإخلال بأحكام الأنظمة ذات العلاقة، للمدين أو الدائن أو الجهة المختصة التقدم إلى المحكمة بطلب افتتاح إجراء التصفية للمدين إذا كان المدين متعثراً أو مفلساً.
- Article 93
The article requires that a liquidation request be accompanied by the information and documents the Implementing Regulations specify to be registered, and sets special conditions where one or more creditors file it.
1- يشترط لقيد طلب افتتاح إجراء التصفية لدى المحكمة أن يقدم الطلب مرافقاً له المعلومات والوثائق ذات العلاقة، وفقاً لما تحدده اللائحة. 2- لا يقيد طلب دائن أو أكثر
- Article 94
A creditor's request to open liquidation is not registered if the debtor disputed the debt before the request, and filing it despite proof of the dispute is an abuse of the procedure.
لا يقيد طلب الدائن بافتتاح إجراء التصفية إذا كان المدين قد نازع الدائن في الدين قبل تقدم الدائن بالطلب. ويعد طلب الدائن افتتاح الإجراء مع وجود ما يثبت منازعة ال
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.