Skip to content
Qanoon
Sign in

Article 19 of the Saudi Companies Law

المادة 19 من نظام الشركات · الفصل الثاني: مالية الشركة

The article exempts micro and small companies and the general partnership company from the requirement to appoint an auditor in Article 18, with specified exceptions, and allows holders of 10% of voting rights to request that one be appointed.

Official text (Arabic)

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

1- لا يسري على الشركة متناهية الصغر والصغيرة الحكم المتعلق بإلزامية تعيين مراجع الحسابات الوارد في المادة (الثامنة عشرة) من النظام، عدا الشركة متناهية الصغر والصغيرة الآتية:

أ- التي ينص عقد تأسيسها أو نظامها الأساس على ذلك.

ب- المدرجة في السوق المالية.

ج- التي تصدر أدوات دين أو صكوكًا تمويلية متداولة أو أسهمًا ممتازة أو أسهمًا قابلة للاسترداد.

د- التي يلزم فيها تعيين مراجع حسابات وفقًا للأنظمة ذات العلاقة.

هـ- الأجنبية.

و- التي تمتلك شركة أخرى أو تكون تابعة لشركة أخرى إلا في حال انطباق وصف الشركة متناهية الصغر أو الصغيرة على جميع تلك الشركات.

ولأغراض تطبيق هذه الفقرة، تحدد اللوائح المعايير التي يكون بناء عليها وصف الشركة بأنها شركة متناهية الصغر أو صغيرة.

2- يشترط لسريان الحكم الوارد في الفقرة (1) من هذه المادة أن ينطبق على الشركة وصفها بأنها شركة متناهية الصغر أو صغيرة خلال السنة المالية الأولى من قيدها لدى السجل التجاري، أو خلال سنتين ماليتين متتاليتين.

3- يجوز لشريك أو مساهم أو أكثر في الشركة -التي يسري عليها ما ورد في الفقرة (1) من هذه المادة- الذين يمثلون (عشرة في المائة) على الأقل من حصصها أو أسهمها التي لها حقوق تصويت، أن يطلبوا -كتابة- من الشركة تعيين مراجع حسابات وفقًا للضوابط التي تحددها اللوائح.

4- لا يسري الحكم المتعلق بإلزامية تعيين مراجع الحسابات الوارد في المادة (الثامنة عشرة) من النظام على شركة التضامن إلا في إحدى الحالات الآتية:

أ- إذا كان جميع الشركاء فيها أشخاصًا اعتباريين متخذين أي شكل من أشكال الشركات غير شركة التضامن.

ب- إذا كان جميع الشركاء فيها أشخاصًا اعتباريين متخذين شكل شركة التضامن وكان الشركاءُ فيها أشخاصًا اعتباريين متخذين أي شكل من أشكال الشركات غير شركة التضامن.

ج- إذا نص في عقد تأسيس الشركة على تعيينه.

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 19 explained in plain English

This article relieves some companies of the requirement to appoint an auditor set in Article 18.

First: the micro and small company is not subject to the requirement, unless it is:

  1. one whose founding contract or articles of association provide for appointing one.
  2. listed on the capital market.
  3. issuing debt instruments or tradable financing sukuk, or preferred or redeemable shares.
  4. required to appoint one under the relevant laws.
  5. foreign.
  6. one that owns another company or is a subsidiary of another company, unless the micro or small description applies to all those companies.

The regulations determine the criteria for describing a company as micro or small. For the exemption, it is a condition that this description applies during the first financial year from registration, or during two consecutive financial years.

The partners' right to request: even with the exemption, one or more partners or shareholders representing at least 10% of the shares or stock carrying voting rights may request in writing that an auditor be appointed, in accordance with controls set by the regulations.

Second: the general partnership company is not subject to the requirement unless all its partners are legal persons other than general partnership companies, or are general partnership companies whose partners are legal persons other than general partnership companies, or its founding contract provides for appointing one.

Practical example

Mona runs a small limited liability company in Abha that is not listed and is not linked to other companies. If it meets the small company criteria set by the regulations under the conditions of this article, it need not appoint an auditor, unless partners holding at least 10% of the shares carrying voting rights request it in writing.

Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.

How we write and review content

A question about Article 19 of Companies Law?

Describe what happened and specialist lawyers answer. You can write in English.

  • Completely free
  • Lawyers from the directory answer
  • Your name stays hidden
Ask a lawyer for free

Commercial & Corporate Law lawyers: ask a specialist about your case

Describe your situation briefly and we'll suggest a lawyer who specialises in this law

Commercial & Corporate Law lawyers

Lawyers who handle this kind of case

See all lawyers

Frequently asked questions about Article 19 of the Saudi Companies Law

Is a small company required to appoint an auditor?

As a rule the requirement does not apply to it, except in the excepted cases, such as where its founding contract provides for one or it is listed or foreign.

Who determines whether a company is small or micro?

The regulations set the criteria by which a company is described as micro or small.

Can a partner require a small company to appoint an auditor?

One or more partners or shareholders representing at least 10% of the shares or stock carrying voting rights may request it in writing, in accordance with the controls in the regulations.

Is a general partnership company required to have an auditor?

No, unless all its partners are legal persons as the article explains, or its founding contract provides for appointing one.

Articles this article refers to

More articles on Company Management and Managers' Liability

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.