Article 82 of the Saudi Bankruptcy Law
المادة 82 من نظام الإفلاس · الفصل الرابع: إجراء إعادة التنظيم المالي: بيع الأصول المضمونة
The trustee sells the bankruptcy estate assets securing the debtor's debt under the plan and with court approval, deposits the net proceeds in a separate account for the secured creditor, and the surplus in the debtor's account.
Official text (Arabic)
This article has not been amended since the law was issued.
يتولى الأمين -بناء على الخطة وبعد موافقة المحكمة- بيع أي من أصول التفليسة الضامنة لدين المدين خلال فترة الإجراء بالأسعار المتداولة وقت البيع. وعليه بعد استيفاء أتعابه ومصروفات البيع إيداع الجزء المتبقي من حصيلة البيع في حساب جار مستقل لسداد دين الدائن المضمون وفقاً لترتيب ضمانه، وإذا فاضت المبالغ المودعة في الحساب الجاري على مقدار الدين المضمون فعلى الأمين أن يودع هذا الفائض في حساب المدين.
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 82 explained in plain English
This article governs the sale of bankruptcy estate assets that secure the debtor's debt during the financial restructuring procedure, and how the proceeds are handled:
- Conditions of sale: The trustee carries out the sale under the plan and after the court's approval, during the period of the procedure.
- Sale price: At the prices prevailing at the time of sale.
- What is paid first: The trustee takes from the proceeds the trustee's fees and the expenses of the sale.
- Separate account: The trustee deposits the remainder in a separate current account to repay the secured creditor's debt in the order of its security.
- Surplus: If the deposited amounts exceed the amount of the secured debt, the trustee deposits the surplus in the debtor's account.
The result is that the proceeds of the secured asset, after the trustee's fees and the expenses of sale, are set aside in a separate account to repay the secured creditor's debt in the order of its security, and only what exceeds the amount of the secured debt goes back to the debtor.
The article does not address the case where the proceeds fall short of the secured debt, and does not set the amount of the trustee's fees. Its provision is connected to Article 81, which prevents the proposal from including anything that contravenes the provisions of the law and the relevant laws on set-off and priority of debts.
A secured creditor or debtor who wants to verify that the sale and the distribution of its proceeds were proper can consult a lawyer specializing in bankruptcy or in banking and finance.
Practical example
A company in Dammam is in financial restructuring, and its plan provides for selling trucks mortgaged to a finance company for a debt of SAR 1.5 million. After the court's approval, the trustee sold the trucks at the prevailing price for SAR 2 million, took the trustee's fees and the expenses of sale of SAR 100,000, deposited SAR 1.9 million in a separate current account to repay the finance company's debt, then deposited the surplus of SAR 400,000 in the debtor company's account.
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 82 of the Saudi Bankruptcy Law
Can the trustee sell a mortgaged asset during financial restructuring?
Yes, under the plan and after the court's approval, at the prices prevailing at the time of sale.
How is the secured creditor paid from the sale proceeds?
After the trustee's fees and the expenses of sale are taken, the remainder is deposited in a separate current account to repay the secured creditor's debt in the order of its security.
Who receives the surplus after the secured debt is paid?
The trustee deposits it in the debtor's account.
More articles on Financial Reorganization
- Article 41
After a protective settlement ends, the court, on its own initiative or at an interested party's request, opens the appropriate bankruptcy procedure if three conditions are met together.
تقضي المحكمة -من تلقاء نفسها أو بناء على طلب ذي مصلحة- بافتتاح إجراء الإفلاس المناسب إذا تحققت الشروط الآتية: أ- أن يكون المدين متعثراً أو مفلساً. ب- استيفاء شر
- Article 42
The article states who may request the opening of financial reorganization and its three cases, and bars the request if the debtor underwent this procedure in the previous 12 months.
1- دون الإخلال بأحكام الأنظمة ذات العلاقة، للمدين أو الدائن أو الجهة المختصة التقدم إلى المحكمة بطلب افتتاح إجراء إعادة التنظيم المالي للمدين في أي من الحالات ا
- Article 43
A request to open the financial reorganization procedure is filed with the court after submission, accompanied by the relevant information and documents as the Implementing Regulations specify.
يقيد طلب افتتاح إجراء إعادة التنظيم المالي لدى المحكمة بعد تقديمه مرافقاً له المعلومات والوثائق ذات العلاقة، وفقاً لما تحدده اللائحة.
- Article 44
If someone other than the debtor submits a financial reorganization request, the court notifies the debtor within 5 days, and the debtor may object at the hearing in three cases.
إذا تقدم غير المدين بطلب افتتاح إجراء إعادة التنظيم المالي، فعلى المحكمة تبليغ المدين به خلال مدة لا تزيد على (خمسة) أيام من تاريخ تقديمه، وللمدين الاعتراض على
- Article 45
The debtor, owner, manager, officer, board member and auditor are exempted from the Companies Law provisions on a company's losses reaching a specified percentage, as the Implementing Regulations specify.
يعفى المدين أو المالك أو المدير أو المسؤول أو عضو مجلس الإدارة أو مراجع الحسابات من تطبيق أحكام نظام الشركات فيما يخص بلوغ خسائر الشركة نسبة محددة في ذلك النظام
- Article 46Amended by M/89
Filing a financial reorganization request or opening the procedure stays claims for 180 days, extendable by up to 180 days, with cases for an early end.
1- يترتب على قيد طلب افتتاح إجراء إعادة التنظيم المالي أو افتتاحه، تعليق المطالبات لمدة (مائة وثمانين) يوماً، وللمحكمة من تلقاء نفسها، أو بناءً على طلب الأمين أ
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.