Article 208 of the Saudi Companies Law
المادة 208 من نظام الشركات · الباب الثامن: الشركة المهنية
The article bars the authority of the manager or board of a professional company owned by more than one person from including anything that impairs the independence of partners or shareholders in practicing their liberal professions.
Official text (Arabic)
This article has not been amended since the law was issued.
لا يجوز أن تتضمن سلطة المدير أو مجلس إدارة الشركة المهنية -المملوكة لأكثر من شخص واحد- ما يخل باستقلال الشركاء أو المساهمين في ممارستهم لمهنهم الحرة.
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 208 explained in plain English
This article places a limit on management authority in the professional company to protect professional independence.
Scope of the rule: a professional company owned by more than one person. The text does not address a company owned by one person.
Content of the rule: the authority of the manager or board of directors may not include anything that impairs the independence of the partners or shareholders in practicing their liberal professions.
What does this mean in practice? The management may run the company's affairs, but its powers may not extend to anything that touches the independence of the professional partner or shareholder in carrying out his professional work. The article separates the company's administrative affairs from the professional independence of those who practice the profession in it.
This article complements Article 207, which allows persons who are not partners or not licensed to manage under conditions, and has the formation contract or articles of association set the manager's powers; this article places a restriction on those powers. It is also connected to Article 209, which makes each partner or shareholder personally liable for his professional errors toward the company and the other partners.
The article does not specify the forms of impairing independence. If a partner believes that an administrative decision touches his professional independence, it is advisable for him to consult a lawyer specializing in companies and commercial cases.
Practical example
A professional law firm in Dammam is owned by four lawyers, and its manager issued instructions requiring the partner lawyers to adopt a particular legal opinion in their cases, contrary to their professional judgment. These instructions may be regarded as impairing the partners' independence in practicing their profession, which the manager's authority may not include.
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 208 of the Saudi Companies Law
Does the manager of a professional company have the right to interfere in a partner's professional work?
The authority of the manager or board of directors may not include anything that impairs the independence of the partners or shareholders in practicing their liberal professions.
Does this rule apply to a professional company owned by one person?
The text of the article applies to a professional company owned by more than one person.
More articles on Professional Company
- Article 197
The article defines the professional company as a company formed by one or more persons licensed in one or more liberal professions, or by them together with others, for the purpose of practicing those professions.
الشركة المهنية هي شركة يؤسسها شخص أو أكثر من المرخص لهم نظامًا في ممارسة مهنة حرة واحدة أو أكثر، أو منهم مع غيرهم، ويكون غرضها ممارسة تلك المهن.
- Article 198
The article provides that a professional company takes any of the company forms set out in Article 4 of the Companies Law.
تتخذ الشركة المهنية أيًّا من أشكال الشركات الواردة في المادة (الرابعة) من النظام.
- Article 199
The article applies the rules of its form to the professional company where there is no special provision, and provides that a partner or shareholder in it does not acquire the status of merchant by virtue of the partnership.
1- تسري على الشركة المهنية -فيما لم يرد به نص خاص في هذا الباب- الأحكام الخاصة بشكل الشركة الذي تتخذه، وبما لا يتعارض مع طبيعتها. 2- لا يكتسب الشريك أو المساهم
- Article 200
The article sets the ways to form a professional company: between licensed persons, by one person, across several professions or with a non-Saudi professional company, and participation by unlicensed persons under the regulations.
1- للأشخاص المرخص لهم في ممارسة مهنة حرة واحدة أن يؤسسوا فيما بينهم شركة مهنية بأي شكل من الأشكال الواردة في المادة (الرابعة) من النظام. 2- للشخص المرخص له في م
- Article 201
The article bars a partner or shareholder who practices the profession in a professional company from taking part in another professional company practicing the same profession, unless the formation contract or articles of association provide for it.
لا يجوز للشريك في شركة مهنية ولا للمساهم فيها، الممارسين لمهنة حرة، المشاركة ولا المساهمة في شركة مهنية أخرى تمارس المهنة الحرة ذاتها، ما لم ينص عقد تأسيس الشرك
- Article 202
The article provides that a professional company is formed under the formation procedures prescribed for its form, and that partners may dissolve it only after announcement and written notice to everyone dealing with it, under the regulations.
1- تؤسس الشركة المهنية وفقًا لإجراءات التأسيس المقررة لشكل الشركة. 2- لا يجوز للشركاء ولا للمساهمين في الشركة المهنية حلها إلا بعد الإعلان عن ذلك وإبلاغ جميع ال
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.