Article 207 of the Saudi Bankruptcy Law
المادة 207 من نظام الإفلاس · الفصل الثالث عشر: العقوبات والتعاملات القابلة للإلغاء: نطاق التطبيق
The article punishes anyone who violates the Bankruptcy Law or its Implementing Regulations with a fine of up to SAR 500,000, without prejudice to Article 203.
Official text (Arabic)
This article has not been amended since the law was issued.
دون إخلال بأحكام المادة (الثالثة بعد المائتين) من النظام، يعاقب كل من يخالف أحكام النظام واللائحة بغرامة لا تزيد على خمسمائة ألف ريال.
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 207 explained in plain English
This article sets a general penalty for violating the provisions of the Bankruptcy Law and its Implementing Regulations: a fine of up to SAR 500,000.
The main points to note:
- Its scope is wide: it covers anyone who violates the provisions of the law and the Implementing Regulations.
- Only a maximum: the article sets the upper limit of the fine with no minimum.
- Without prejudice to Article 203: this fine does not affect what Article 203 provides, which remains to be consulted within its own scope.
This fine is therefore a general sanction for violating the provisions of the law and the Implementing Regulations, with Article 203 remaining in force alongside it.
The article is linked to Article 206, which requires the bankruptcy trustee, if he suspects the debtor or any of its creditors of any of the criminalized acts, to go to the competent authority, and to Article 208, which makes investigation and prosecution of the acts criminalized by the law a matter for the Public Prosecution, and the imposition of penalties a matter for the court. For an assessment of a specific situation, consult a lawyer specializing in bankruptcy and commercial cases or in criminal cases.
Practical example
An officer of a company under a bankruptcy procedure in Riyadh violated a provision of the law's Implementing Regulations. Under this article, he is exposed to a fine of up to SAR 500,000.
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 207 of the Saudi Bankruptcy Law
What is the fine for violating the Bankruptcy Law?
Anyone who violates the provisions of the law and the Implementing Regulations is punished with a fine of up to SAR 500,000, without prejudice to Article 203.
Does this fine cancel the other penalties in the law?
No. The article applies without prejudice to Article 203, so that article remains in force alongside this fine.
Articles this article refers to
More articles on Bankruptcy Offenses and Voidable Transactions
- Article 71
At an interested party's request, the court may annul the debtor's disposal of estate assets outside its usual business in breach of Article 70 and recover the assets, taking into account the rights of good-faith third parties.
إذا تصرف المدين في أي من أصول التفليسة خارج نطاق مزاولة نشاطه المعتاد بالمخالفة لحكم الفقرة (1/ن) من المادة (السبعين) من النظام، فللمحكمة أن تقضي -بناء على طلب
- Article 174
The article requires the Bankruptcy Committee to refer the matter to the relevant authority if it sees a need for further verification because of suspicion of a crime or violation in any claim or act.
على لجنة الإفلاس -إذا رأت حاجة لإجراء مزيد من التحقق لوجود شبهة جريمة أو مخالفة منصوص عليها في النظام في أي مطالبة أو تصرف- إحالة الأمر إلى الجهة المعنية.
- Article 200
The article lists acts by an individual debtor, a debtor's managers, board members, officers and others that violate the law if committed before or during bankruptcy and harm others.
دون الإخلال بأحكام الأنظمة ذات العلاقة، يعد مخالفاً لأحكام النظام كل مدين ذي صفة طبيعية أو مدير لدى مدين أو عضو في مجلس إدارته أو مجلس مديريه أو أي من مسؤوليه أ
- Article 201
The article lists acts that violate the Bankruptcy Law if committed by any person before bankruptcy and leading to it, or during it, and harming the parties' rights.
دون الإخلال بأحكام الأنظمة ذات العلاقة، يعد مخالفاً لأحكام النظام كل من ارتكب قبل افتتاح أي من إجراءات الإفلاس واحداً أو أكثر من الأفعال الآتية وأدى إلى افتتاحه
- Article 202
The article lists acts by a creditor, or someone claiming to be one, that violate the law, such as fraudulent claims, harmful arrangements with the debtor and abuse of procedures.
دون الإخلال بأحكام الأنظمة ذات العلاقة، يعد مخالفاً لأحكام النظام كل دائن أو من يدعي هذه الصفة ارتكب قبل افتتاح أي من إجراءات الإفلاس واحداً أو أكثر من الأفعال
- Article 203
The article sets the penalty for the acts criminalized in Articles 200, 201 and 202: imprisonment up to 5 years and a fine up to SAR 5 million or either, with possible bans on managing establishments.
1- دون الإخلال بأي عقوبة أشد ينص عليها نظام آخر، يعاقب كل من ارتكب أياً من الأفعال المجرّمة المنصوص عليها في المواد (المائتين) و(الأولى بعد المائتين) و(الثانية
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.