Article 56 of the Saudi Bankruptcy Law

المادة 56 من نظام الإفلاس · الفصل الرابع: إجراء إعادة التنظيم المالي: الإعلان عن الإجراء

Within 7 days of appointment, the trustee announces the opening ruling for financial reorganization and invites creditors to submit claims within 90 days, and notifies the creditors known to it of the ruling.

Official text (Arabic)

This article has not been amended since the law was issued.

1- يعلن الأمين خلال (سبعة) أيام من تاريخ تعيينه في الوسيلة التي تحددها اللائحة حكم المحكمة بافتتاح إجراء إعادة التنظيم المالي، ويدعو الدائنين إلى تقديم مطالباتهم خلال مدة لا تزيد على (تسعين) يوماً من تاريخ الإعلان.

2- يبلغ الأمين الدائنين المعلومين لديه بالحكم، ويدعوهم إلى تقديم مطالباتهم خلال مدة لا تزيد على (تسعين) يوماً من تاريخ التبليغ.

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 56 explained in plain English

This article sets out the trustee's first steps after being appointed, which are informing creditors of the opening of the financial reorganization procedure and inviting them to submit their claims.

First: the public announcement

The trustee announces the court's ruling opening the procedure within 7 days of the date of its appointment.
The announcement is made by the means the Implementing Regulations specify; the article does not name them.
It invites creditors to submit their claims within a period of no more than 90 days from the date of the announcement.

Second: direct notification

The trustee notifies the creditors known to it of the ruling.
It invites them to submit their claims within a period of no more than 90 days from the date of notification.

Note that the start of the 90-day period differs by method: for the public announcement it runs from the date of the announcement, and for direct notification from the date of notification. The text says "no more than 90 days," so it is a maximum for the period the trustee sets. The article does not address the effect of submitting a claim after the period expires.

This article is linked to Article 57, which makes the trustee the supervisor of the debtor's business during the procedure, and to Article 55, which refers to the Implementing Regulations for the mechanism of setting the fees of the trustee and expert.

If you are a creditor of a business for which this procedure has been opened, it is advisable to follow the announcement and consult a lawyer specializing in bankruptcy and commercial cases promptly so that you submit your claim in time.

Practical example

Abdullah owns a supply establishment in Taif that is owed money by a company for which a financial reorganization procedure was opened. The trustee was appointed and announced the opening ruling 5 days after its appointment, and sent Abdullah a direct notice because he is one of the creditors known to it. Abdullah must submit his claim within the period stated in the notice, which is no more than 90 days from its date.

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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