Article 87 of the Saudi Bankruptcy Law
المادة 87 من نظام الإفلاس · الفصل الرابع: إجراء إعادة التنظيم المالي: إنهاء الإجراء
The article lists seven cases in which the court ends the financial restructuring procedure, on the request of the debtor, the trustee, a creditor or an interested party, or where confirmation is refused.
Official text (Arabic)
This article has not been amended since the law was issued.
تقضي المحكمة بإنهاء إجراء إعادة التنظيم المالي في أي من الحالات الآتية:
أ- إذا تقدم المدين بطلب إنهاء الإجراء لأن شروط افتتاح الإجراء لم تعد منطبقة عليه، على أن يرفق بطلبه تقريراً من الأمين يؤيد ذلك.
ب- إذا تقدم الأمين بطلب إنهاء الإجراء لاكتمال تنفيذ الخطة وانتهاء مهماته.
ج- إذا تقدم الأمين بطلب إنهاء الإجراء لعدم تحقق النصاب المطلوب لتصويت الدائنين على المقترح أو تعذر تصويتهم عليه في الموعد المحدد لذلك, وذلك دون الإخلال بحكم الفقرة (5) من المادة (التاسعة والسبعين) من النظام.
د- إذا رفضت المحكمة التصديق على المقترح.
هـ- إذا تقدم الأمين أو الدائن بطلب إنهاء الإجراء لتعذر تنفيذ الخطة.
و- إذا تقدم الأمين بطلب موقع من المدين بإنهاء الإجراء لعدم رغبة المدين في الاستمرار في إدارة نشاطه أو استكمال تنفيذ الخطة، وذلك دون إخلال بأحكام المادة (التاسعة والستين) من النظام.
ز- إذا تقدم ذو مصلحة بطلب إنهاء الإجراء لوجود مخالفات مؤثرة خلال الإجراء أو لارتكاب المدين أحد الأفعال المجرمة في النظام خلال فترة سريان الإجراء، وذلك دون إخلال بأحكام المادة (التاسعة والستين) من النظام.
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 87 explained in plain English
The court ends the financial restructuring procedure in any of the following cases:
- If the debtor asks to end the procedure because the conditions for opening it no longer apply to the debtor, attaching to the request a report from the trustee supporting this.
- If the trustee asks to end it because the plan has been fully implemented and its duties are finished.
- If the trustee asks to end it because the quorum required for the creditors' vote on the proposal was not met, or because the creditors could not vote on the set date, without prejudice to paragraph 5 of Article 79.
- If the court refuses to confirm the proposal.
- If the trustee or a creditor asks to end it because the plan cannot be implemented.
- If the trustee files a request signed by the debtor to end the procedure because the debtor does not wish to continue managing its business or completing implementation of the plan, without prejudice to the provisions of Article 69.
- If an interested party asks to end it because of significant violations during the procedure, or because the debtor committed one of the acts criminalized in the law during the period the procedure was in effect, without prejudice to the provisions of Article 69.
The list shows that the request to end may come from the debtor, the trustee, a creditor or any interested party, depending on the case, and that the court's refusal to confirm the proposal is a separate case of ending.
This article is connected to Article 86, which requires the trustee, when implementation of the plan is complete, to request ending after notifying the creditors, and allows any interested party to object within 14 days of the request being filed, and to Article 88, which provides that a judgment ending the procedure does not relieve the guarantor of the plan's implementation of its obligations, and does not oblige any creditor to return what it received from the debtor before the ending.
To assess whether a particular situation justifies a request to end, you can consult a lawyer specializing in bankruptcy and commercial cases.
Practical example
A financial restructuring plan of an industrial company in Yanbu has been confirmed, and its sales then declined sharply and it can no longer perform what it committed to in the plan. A creditor or the trustee may ask the court to end the procedure because the plan cannot be implemented.
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 87 of the Saudi Bankruptcy Law
When does the court end the financial restructuring procedure?
In seven cases, including full implementation of the plan, refusal to confirm the proposal, the plan being impossible to implement, and the required quorum for the creditors' vote not being met.
Can a creditor ask to end the financial restructuring?
Yes. A creditor may ask to end it because the plan cannot be implemented, and any interested party may ask for it because of significant violations or because the debtor committed one of the acts criminalized in the law during the procedure.
Can the debtor itself ask to end the procedure?
Yes, if the conditions for opening the procedure no longer apply to it, with a supporting report from the trustee, or through a request signed by the debtor and filed by the trustee because the debtor does not wish to continue.
Articles this article refers to
- Article 69
The debtor continues to manage its business during financial reorganization under the trustee's supervision, and at the trustee's request the court may remove its control in cases of negligence, mismanagement or criminal acts.
1- دون إخلال بصلاحيات ومهمات الأمين، يستمر المدين في إدارة أعماله ونشاطه خلال فترة إجراء إعادة التنظيم المالي تحت إشراف الأمين. 2- إذا ارتكب المدين أو أحد المسؤ
- Article 79
Creditors vote on the proposal, and a class accepts it when creditors representing two-thirds of the debts of those voting in it agree, including more than half the debts of non-related parties.
1- يصوت الدائنون على المقترح وفقاً للإجراءات الواردة فيه. 2- يتحقق قبول كل فئة من فئات الدائنين للمقترح إذا صوت بالموافقة عليه دائنون تمثل مطالباتهم ثلثي قيمة د
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.