Article 37 of the Saudi Commercial Maritime Law
المادة 37 من النظام البحري التجاري · الفصل الأول: بناء السفينة وملكيتها
The article provides that the majority view, meaning owners of more than half the shares, governs decisions on operating a jointly owned ship, and lets the dissenting minority ask a court to annul a decision within 15 days.
Official text (Arabic)
This article has not been amended since the law was issued.
1- يُتَّبع رأي الأغلبية في كل قرار يتعلق باستغلال سفينة مملوكة على الشيوع، ما لم ينص النظام أو يتفق المالكون على غير ذلك.
2- تتوافر الأغلبية لمالكي أكثر من نصف الحصص في السفينة، ما لم يتفق المالكون على أغلبية أخرى.
3- يجوز لكل مالك من الأقلية التي لم توافق على القرار إقامة دعوى بطلب إلغاء القرار خلال خمسة عشر يوماً من تاريخ صدوره أمام المحكمة المختصة التي يقع في نطاقها مكتب تسجيل السفينة. وللمحكمة الإبقاء على القرار أو إلغاؤه، ولا يترتب على إقامة الدعوى وقف تنفيذ القرار إلاَّ إذا أمرت المحكمة بذلك.
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 37 explained in plain English
This article regulates decision-making for a ship owned by several persons in joint ownership.
1. The majority rule: the majority view is followed in every decision concerning the operation of the ship, unless the law provides, or the owners agree, otherwise.
2. The meaning of majority: it is held by the owners of more than half the shares, not more than half the number of owners, unless the owners agree on another majority.
3. The minority's right:
- Each owner in the minority that did not approve the decision may file a suit to annul it.
- The period: 15 days from the date the decision was issued.
- The court: the competent court in whose jurisdiction the ship's registration office is located.
- The court may uphold or annul the decision.
- Filing the suit does not stay implementation of the decision unless the court so orders.
In practical terms, a partner holding a small share cannot block operating decisions, but has a judicial means of objecting, provided he acts within 15 days. The period runs from the date the decision was issued. The article does not specify the grounds on which decisions are annulled.
A person who is a co-owner of a ship and objects to a decision affecting them would do well to consult a lawyer specializing in commercial cases before the period expires.
Practical example
Four partners own a ship: one holds 55% and each of the others 15%. The 55% holder decides to charter the ship for certain voyages, and he holds the majority because he owns more than half the shares. Each of the three who did not approve may file a suit to annul the decision within 15 days.
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 37 of the Saudi Commercial Maritime Law
How are decisions made for a ship owned by several partners?
The majority view is followed on decisions about its operation, and the majority is held by the owners of more than half the shares unless otherwise agreed.
Can a decision of the majority of partners be challenged?
Yes. Each owner in the dissenting minority may file a suit to annul the decision within fifteen days of its issuance.
Does the suit stay implementation of the decision?
No, unless the court orders it.
More articles on Ship Construction and Co-Ownership
- Article 31
The article requires a ship construction contract, and any amendment to it, to be proved in writing, and the contract is valid only if signed by its parties.
يثبت عقد بناء السفينة وأي تعديل يطرأ عليه بالكتابة، ولا يكون صحيحاً إلا بتوقيع أطرافه عليه.
- Article 32
The article provides that ownership of the ship remains with the builder and passes to the party ordering it only on accepting delivery after trials, unless agreed otherwise.
تبقى ملكية السفينة لمتعهد البناء، ولا تنتقل ملكيتها إلى طالب البناء إلا بقبول تسلمها بعد تجربتها، ما لم يتفق على غير ذلك.
- Article 33
The article makes the ship builder guarantee that the ship is free of hidden defects, even if the party ordering it accepted delivery after trials.
يضمن متعهد بناء السفينة خلوها من العيوب الخفية، وإن قبل طالب البناء تسلم السفينة بعد تجربتها.
- Article 34
The article provides that a suit for guarantee of hidden defects is not heard after one year from the date of learning of the defect.
لا تسمع دعوى ضمان العيوب الخفية بعد مضي سنة من تاريخ العلم بالعيب.
- Article 35
The article extends the hidden-defect guarantee and the one-year period from learning of the defect, set in Articles 33 and 34, to ship repair contracts.
تسري أحكام المادتين (الثالثة والثلاثين) و(الرابعة والثلاثين) على عقود إجراء إصلاحات السفينة.
- Article 36
The article requires acts creating, transferring or ending ownership of a ship or other real rights in it to be proved by an official document, otherwise void, and they are effective against third parties only once entered in the ship's register.
1- تُثبت التصرفات التي يكون موضوعها إنشاء حق الملكية أو نقله أو انقضاءه، أو غير ذلك من الحقوق العينية على السفينة؛ بمحرر رسمي، وإلاَّ كانت باطلة. وإذا وقعت هذه
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.