Article 30 of the Saudi Bankruptcy Law
المادة 30 من نظام الإفلاس · الفصل الثالث: إجراء التسوية الوقائية: التصويت على المقترح
Article 30 requires an expert to be appointed to value disputed claims for voting purposes, and allows creditors' claims omitted from the proposal for a reason attributable to the debtor to be included with court approval.
Official text (Arabic)
This article has not been amended since the law was issued.
1 - إذا كان هناك مطالبات للدائنين متنازع فيها، فعلى المدين تعيين خبير من بين المدرجين بقائمة الخبراء توافق عليه المحكمة؛ لتقدير قيمة تلك المطالبات، وتدرج في المقترح لأغراض التصويت عليه.
2 - تدرج في المقترح -بعد موافقة المحكمة- مطالبات الدائنين التي لم تضمّن في المقترح لسبب عائد للمدين.
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 30 explained in plain English
This article addresses two problems that may arise when preparing the proposal and voting on it.
First: disputed claims. If there are creditor claims that the debtor disputes (for example, by disagreeing on the amount of the debt or whether it exists):
- The debtor must appoint an expert to value those claims.
- The expert must be one listed in the register of experts.
- The expert must be approved by the court.
- The estimated value is included in the proposal for the purposes of voting on it.
Note that the text makes the inclusion "for voting purposes": the aim is to enable the holder of a disputed claim to vote with an estimated value. The article does not address resolving the underlying dispute.
Second: claims not included. If some creditors' claims are not included in the proposal for a reason attributable to the debtor (for example, the debtor omitted to mention them), they are included in the proposal after court approval. This protects a creditor from being deprived of participation because of the debtor's error or omission.
This article is linked to Article 31, which governs the creditors' vote: the proposal is accepted if every class approves it, and a class is considered to approve if creditors whose claims represent two thirds of the value of the debts of those voting in it vote in favor, including creditors whose claims represent more than half of the value of the debts of unrelated parties (if any). The valuation of a claim therefore directly affects the weight of a creditor's vote. It is also linked to Article 29 on classifying creditors into classes.
A creditor whose claim is disputed or was not included in the proposal should consult a lawyer specializing in commercial and bankruptcy cases.
Practical example
A supplier in Riyadh claims SAR 500,000 from a company in a protective settlement, while the company says the debt is only SAR 300,000. The company appoints an expert from the register of experts whom the court approves to value the claim, and the estimated value is included in the proposal for the supplier to vote with.
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 30 of the Saudi Bankruptcy Law
What happens if a debt is disputed in a protective settlement?
The debtor must appoint an expert from the register of experts, approved by the court, to value the claim, and it is included in the proposal for voting purposes.
What if the debtor forgot to include a creditor in the proposal?
Creditors' claims not included in the proposal for a reason attributable to the debtor are included in it after court approval.
Who chooses the expert to value disputed claims?
The debtor appoints the expert from those listed in the register of experts, subject to the court's approval.
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 18
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.
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 (ثلاثي
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.