Article 153 of the Saudi Bankruptcy Law
المادة 153 من نظام الإفلاس · الفصل السابع: إجراء إعادة التنظيم المالي لصغار المدينين: التصويت
The article requires one voting class for secured creditors and another for unsecured creditors, and lets the court, if voting is not possible, set another date or end the procedure.
Official text (Arabic)
This article has not been amended since the law was issued.
1- لأغراض التصويت على المقترح، يجب تخصيص فئة تصويت للدائنين المضمونين -إن وجدوا- وفئة أخرى للدائنين غير المضمونين.
2- إذا تعذر تصويت الدائنين على المقترح في الموعد المحدد، فتقضي المحكمة بما تراه مناسباً بما في ذلك تحديد موعد آخر للتصويت أو إنهاء الإجراء.
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 153 explained in plain English
This article deals with how creditors are divided when voting on the financial reorganization proposal for small debtors, and what happens if the vote does not take place on time.
First: voting classes. Two classes must be allocated:
- a class for secured creditors, if any.
- another class for unsecured creditors.
This means that the vote of a secured creditor is not mixed with the votes of unsecured creditors, but the position of each class is measured separately. Article 154 explains the quorum required in each class to accept the proposal.
Second: voting not possible. If the creditors cannot vote on the proposal on the date set by the court under Article 152, the court rules as it sees fit, including:
- setting another date for voting, or
- ending the procedure.
The text does not make the inability to vote an automatic reason for ending the procedure, but leaves it to the court to assess the appropriate solution. To learn the effect of this on a particular situation, it is advisable to consult a lawyer specialized in bankruptcy and commercial matters.
Practical example
A date was set for voting on the proposal of a small restaurant in Dammam, but the vote could not take place on that date. The court considers the matter, and may set another date for the vote or rule to end the procedure, as it sees fit.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 153 of the Saudi Bankruptcy Law
Does a secured creditor vote together with the other creditors?
No. A voting class must be allocated for secured creditors, if any, and another for unsecured creditors.
What happens if the vote is not held on the set date?
The court rules as it sees fit, including setting another date for voting or ending the procedure.
More articles on Small Debtor Bankruptcy Procedures
- Article 102
Opening the liquidation leads to the start of liquidating the bankruptcy estate assets, carried out by the trustee, except what the court approves an individual debtor keeping for the living of the debtor and dependents.
1- يترتب على افتتاح إجراء التصفية البدء في تصفية أصول التفليسة. 2- يتولى الأمين تصفية أصول التفليسة عدا ما وافقت المحكمة على احتفاظ المدين ذي الصفة الطبيعية به
- Article 127
The article states that the aim of the protective settlement for small debtors is to let a small debtor agree with its creditors on settling its debts through simple, low-cost procedures while it keeps managing its business.
يهدف إجراء التسوية الوقائية لصغار المدينين إلى تمكين المدين الصغير من التوصل إلى اتفاق مع دائنيه لتسوية ديونه خلال فترة معقولة عبر إجراءات يسيرة بتكلفة منخفضة و
- Article 128
The article lets a small debtor choose the ordinary protective settlement, and bars it from opening a small debtors' settlement if it was subject to it or to a protective settlement in the preceding 12 months.
1- للمدين الصغير طلب افتتاح إجراء التسوية الوقائية بدلاً من افتتاح إجراء التسوية الوقائية لصغار المدينين. 2- لا يجوز للمدين افتتاح إجراء التسوية الوقائية لصغار
- Article 129
The article allows a small debtor that is distressed, bankrupt or expecting distress to issue a decision opening the small debtors' protective settlement and file it with its proposal in the bankruptcy register.
1- للمدين الصغير إذا كان يتوقع مواجهة اضطرابات مالية يخشى معها تعثره أو كان متعثراً أو مفلساً، أن يصدر قراراً بافتتاح إجراء التسوية الوقائية لصغار المدينين وفق
- Article 130
The article requires a small debtor to call the owners to vote on the proposal if it affects their rights, at least 21 days before the voting date and before the creditors vote.
إذا تضمن المقترح ما يؤثر في حقوق الملاك، فعلى المدين الصغير دعوتهم إلى التصويت على المقترح قبل حلول موعد التصويت بـ(واحد وعشرين) يوماً على الأقل وفقاً لما تنص ع
- Article 131
The article lets a small debtor ask the court to suspend claims for no more than 90 days, and explains when that period ends.
1- للمدين الصغير أن يطلب من المحكمة -خلال المدة من افتتاح إجراء التسوية الوقائية لصغار المدينين إلى موافقة الدائنين على المقترح- تعليق المطالبات لمدة لا تزيد عل
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.