Article 76 of the Saudi Bankruptcy Law
المادة 76 من نظام الإفلاس · الفصل الرابع: إجراء إعادة التنظيم المالي: مقترح إعادة التنظيم المالي
Only a creditor whose rights the proposal affects and who has an approved accepted claim may vote on the proposal, as may an owner whose rights it affects.
Official text (Arabic)
This article has not been amended since the law was issued.
1- لا يحق للدائن التصويت على المقترح إلا إذا كان يرتب أثراً في حقوقه النظامية أو التعاقدية وكان له مطالبة مدرجة في قائمة المطالبات المقبولة التي اعتمدتها المحكمة وفقاً لأحكام المادة (الثامنة والستين) من النظام.
2- لا يحق للمالك التصويت على المقترح إلا إذا كان يرتب أثراً في حقوقه النظامية أو التعاقدية.
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 76 explained in plain English
This article determines who may vote on the financial restructuring proposal, and distinguishes between a creditor and an owner:
- Creditor: May vote only if two conditions are both met: the proposal affects the creditor's statutory or contractual rights, and the creditor has a claim included in the list of accepted claims that the court approved under Article 68.
- Owner: May vote only if the proposal affects the owner's statutory or contractual rights.
In both cases what matters is whether the proposal affects the person's rights, not merely being a creditor or an owner. For a creditor there is the added condition that the claim is included in the approved list of accepted claims, so a creditor whose claim is not on it may not vote even if its rights are affected. This is why it matters to file a claim on time and follow up on its inclusion.
This is tied to Article 75, which governs preparing and filing the proposal and the court's setting of the voting date, and to Article 77, which requires the debtor, after the trustee's approval, to notify the creditors whose claims the court has accepted, and the affected owners if the proposal includes anything affecting their rights, of the voting date at least 21 days before it.
To ask about the right to vote in a particular case, you can consult a lawyer specializing in bankruptcy and commercial cases.
Practical example
A bank in Riyadh has a claim against a contracting company that is included in the list of accepted claims the court approved, and the proposal includes deferring payment of its debt for two years. The bank may vote, because the proposal affects its contractual rights and its claim is included in the approved list of accepted claims.
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 76 of the Saudi Bankruptcy Law
Who may vote on the financial restructuring proposal?
A creditor whose statutory or contractual rights the proposal affects and who has a claim included in the list of accepted claims approved by the court, and an owner whose rights the proposal affects.
Can a creditor vote if its claim is not on the accepted list?
No. The creditor's claim must be included in the list of accepted claims the court approved under Article 68.
Do owners vote on the proposal?
An owner votes only if the proposal affects the owner's statutory or contractual rights.
Articles this article refers to
More articles on Creditors' Rights in Bankruptcy
- 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
- Article 20
Article 20 prohibits any action or lawsuit against the debtor or its assets during the stay of claims, and enforcement on security or claims against a guarantor without court approval; any violating action is void.
1- لا يجوز خلال مدة تعليق المطالبات اتخاذ أو استكمال أي من الإجراءات أو التصرفات الآتية: أ- أي إجراء أو تصرف أو دعوى تجاه المدين أو أصوله، بما في ذلك التقدم بطل
- Article 21
Article 21 sets two cases in which the court approves enforcement on security during a stay of claims, addresses the request of a person who finds their property, and lifts the stay for specific claims.
1- توافق المحكمة -خلال مدة تعليق المطالبات- على طلب التنفيذ على أصول التفليسة أو أصول الضامن لدين المدين المقدمة كضمانات في الحالتين الآتيتين: أ- إذا لم يترتب ع
- Article 27
Article 27 limits the right to vote on a protective settlement proposal to a creditor or owner whose statutory or contractual rights are affected by the proposal.
لا يصوت على المقترح إلا الدائن أو المالك الذي يرتب المقترح أثراً في حقوقه النظامية أو التعاقدية، وفقاً لما تحدده اللائحة.
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.