Article 18 of the Saudi Bankruptcy Law
المادة 18 من نظام الإفلاس · الفصل الثالث: إجراء التسوية الوقائية: تعليق المطالبات
Article 18 sets the stay of claims at no more than 90 days, extendable by 30 days at the debtor's request up to a maximum of 180 days, and explains when the stay ends.
Official text (Arabic)
This article has not been amended since the law was issued.
1- دون إخلال بأحكام الفصل (الرابع عشر) من النظام، للمحكمة تعليق المطالبات لمدة لا تزيد على (تسعين) يوماً من تاريخ افتتاح الإجراء، ولها تمديد هذه المدة لـ (ثلاثين) يوماً لمرة أو أكثر بناء على طلب المدين، وفي جميع الأحوال يجب ألا تزيد مدة تعليق المطالبات على (مائة وثمانين) يوماً.
2- تنتهي مدة تعليق المطالبات بانقضاء المدة المحددة في الفقرة (1) من هذه المادة أو قبل ذلك بتصديق المحكمة على المقترح 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 18 explained in plain English
This article governs the duration of the stay of claims in a protective settlement, without prejudice to the provisions of Chapter Fourteen of the Bankruptcy Law.
Original period: The court may stay claims for no more than 90 days from the date the procedure is opened.
Extension:
- The court may extend the period by 30 days, once or more than once.
- An extension is made at the debtor's request.
- In all cases, the total period of the stay may not exceed 180 days.
End of the stay: The stay of claims ends in one of the following cases:
- The period set by the court expires (including any extension).
- The court approves the proposal before the period expires.
- The procedure is terminated before the period expires.
This means a creditor knows that the maximum period during which its claim can be held up in this procedure is limited to 180 days under this article, which balances protecting the debtor with the creditor's right.
Article 17 requires that a request for a stay be accompanied from the outset by a report from a trustee listed in the register of bankruptcy trustees, while Article 19 requires the debtor to notify its creditors of the stay decision as soon as it is issued.
Practical example
The court stayed the claims of a company's creditors in Khobar for 90 days. Before it ended, the company requested an extension and the stay was extended by 30 days, then by another 30 days. The total reached 150 days, so it may be extended one last time by 30 days to reach the maximum of 180 days, and it may not be extended after that.
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 18 of the Saudi Bankruptcy Law
How long is the stay of claims in a protective settlement?
No more than 90 days from the date the procedure is opened. It may be extended by 30 days, once or more than once, provided the total period does not exceed 180 days.
Who requests an extension of the stay of claims?
An extension is made at the debtor's request.
When does the stay of claims end before its period expires?
It ends before its period expires when the court approves the proposal or when the procedure is terminated.
More articles on Protective Settlement
- Article 13
Article 13 allows a debtor at risk of default, defaulting or bankrupt to request the opening of protective settlement, and bars it if it underwent the procedure in the previous twelve months.
1- دون الإخلال بأحكام الأنظمة ذات العلاقة، للمدين التقدم إلى المحكمة بطلب افتتاح إجراء التسوية الوقائية في أي من الحالات الآتية: أ- إذا كان من المرجح أن يعاني م
- Article 14
Article 14 requires the protective settlement request to be accompanied by the proposal, information and documents, and the proposal to include the debtor's financial position and a classification of creditors into classes.
1- يقيد طلب افتتاح إجراء التسوية الوقائية لدى المحكمة بعد تقديمه مرافقاً له المقترح والمعلومات والوثائق ذات العلاقة، وفقاً لما تحدده اللائحة. 2- يجب أن يتضمن ال
- Article 15
Article 15 governs how the court hears a protective settlement application within 40 days, and when it opens the procedure, rejects the application, or adjourns the hearing for up to 21 days.
1- تحدد المحكمة موعداً للنظر في طلب افتتاح إجراء التسوية الوقائية على أن يكون الموعد خلال مدة لا تزيد على (أربعين) يوماً من تاريخ قيد الطلب، وتبلغ المحكمة المدي
- Article 16
Article 16 requires the ruling opening a protective settlement to set a creditors' vote within 40 days, extendable by another 40 days, and requires the debtor to announce the opening within 7 days.
1- تحدد المحكمة في حكمها الصادر بافتتاح إجراء التسوية الوقائية موعداً لتصويت الدائنين على المقترح، على أن يكون الموعد خلال مدة لا تزيد على (أربعين) يوماً من تار
- Article 17
Article 17 allows the debtor to request a stay of claims when applying for a protective settlement, provided it attaches a report from a trustee listed in the register of bankruptcy trustees.
للمدين -عند طلب افتتاح إجراء التسوية الوقائية- أن يطلب من المحكمة تعليق المطالبات، على أن يرفق بطلبه تقريراً معداً من أمين مدرج بقائمة أمناء الإفلاس يتضمن ترجيح
- Article 19
Article 19 requires the debtor to notify its creditors of the stay of claims decision as soon as it is issued, and to exercise due diligence to persuade them to approve the proposal.
يلتزم المدين بتبليغ دائنيه بقرار المحكمة بتعليق المطالبات فور صدوره، وعليه بذل العناية الواجبة خلال مدة تعليق المطالبات لإقناع دائنيه بالتصويت بالموافقة على الم
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.