Article 209 of the Saudi Bankruptcy Law
المادة 209 من نظام الإفلاس · الفصل الثالث عشر: العقوبات والتعاملات القابلة للإلغاء: نطاق التطبيق
The article doubles the penalties under the Bankruptcy Law in case of repeat offense, defining a repeat offender as one who offends again within 3 years of completing the sentence for a final judgment.
Official text (Arabic)
This article has not been amended since the law was issued.
تضاعف في حال العود العقوبات المقررة بموجب النظام، ويعد عائداً كل من ارتكب فعلاً مجرماً أو مخالفة سبق الحكم عليه فيها بحكم نهائي خلال (ثلاث) سنوات من تاريخ اكتمال تنفيذ العقوبة.
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 209 explained in plain English
This article toughens the penalty for anyone who repeats a violation, providing that the penalties set under the law are doubled in case of repeat offense.
A person is a repeat offender when the following conditions are met together:
- He commits a criminalized act or violation under the law.
- A final judgment was previously issued against him for it.
- This occurs within 3 years from the date the penalty was fully carried out.
Note that the period runs from the full execution of the penalty, not from the date the judgment was issued, and that the earlier judgment must be final. The article covers criminalized acts and violations alike, so it applies to the penalties set under the law generally.
The article is linked to Article 208, which makes investigation and prosecution of the acts criminalized under the law a matter for the Public Prosecution, and the imposition of penalties a matter for the court; the court is the one that imposes the doubled penalty when repeat offense is established. The article does not set the amount of the original penalty; it provides for doubling what is set under the law.
For an assessment of a specific situation, consult a lawyer specializing in bankruptcy and commercial cases or in criminal cases.
Practical example
A final judgment was issued against a merchant for a violation of the Bankruptcy Law, and he completed carrying out the penalty, then committed a violation of the Bankruptcy Law two years after the execution was completed. He is a repeat offender because this happened within 3 years, so the penalty set for him is doubled.
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 209 of the Saudi Bankruptcy Law
What is the penalty for repeating a violation of the Bankruptcy Law?
The penalties set under the law are doubled in case of repeat offense.
When is a person a repeat offender under the Bankruptcy Law?
If he commits a criminalized act or violation for which a final judgment was previously issued against him, within 3 years from the date the penalty was fully carried out.
From what date does the three-year period run?
From the date the penalty was fully carried out.
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.