Article 267 of the Saudi Companies Law
المادة 267 من نظام الشركات · الباب الثالث عشر: العقوبات
The article establishes a committee in the Ministry to hear Article 262 violations for unlisted companies, with a right of grievance before the court within 30 days, and makes the Authority's board competent for listed companies.
Official text (Arabic)
This article has not been amended since the law was issued.
1- تكوّن بقرار من الوزير لجنة في الوزارة من أعضاء لا يقل عددهم عن ثلاثة، ويرأسها ذو تأهيل نظامي، وتختص بالنظر في المخالفات المنصوص عليها في المادة (الثانية والستين بعد المائتين) من النظام، وإيقاع العقوبات بشأنها، وذلك فيما عدا المخالفات المتعلقة بشركات المساهمة المدرجة في السوق المالية. ويكون للوزير تحديد المخالفات التي يجوز إيقاع عقوبات مباشرة بشأنها دون عرضها على اللجنة. ويحق لمن صدر ضده قرار العقوبة التظلم أمام المحكمة المختصة خلال (ثلاثين) يومًا من تاريخ التبليغ به وفقًا لوسائل التبليغ التي تحددها اللوائح. وتصدر قواعد عمل اللجنة، وتحدد مكافآت رئيسها وأعضائها وأمانتها، بقرار من الوزير.
2- يختص مجلس الهيئة بإيقاع العقوبات المقررة عن المخالفات المنصوص عليها في المادة (الثانية والستين بعد المائتين) من النظام المتعلقة بشركات المساهمة المدرجة في السوق المالية، ويحق لمن صدر ضده قرار من مجلس الهيئة التظلم أمام لجنة الفصل في منازعات الأوراق المالية وفقًا لأحكام نظام السوق المالية.
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 267 explained in plain English
This article specifies who imposes the penalties for violations set out in Article 262, and how they are challenged.
First: unlisted companies (paragraph 1)
- A committee in the Ministry is formed by decision of the Minister, with no fewer than three members, headed by someone with legal qualifications.
- It is competent to hear the violations of Article 262 and impose penalties for them, except for violations relating to joint stock companies listed on the capital market.
- The Minister may specify the violations for which penalties may be imposed directly without referring them to the committee.
- Anyone against whom a penalty decision is issued has the right to file a grievance before the competent court within 30 days of the date of notification of it, according to the means of notification the regulations specify.
- The committee's rules of work are issued, and the remuneration of its chair and members and its secretariat are specified, by decision of the Minister.
Second: listed companies (paragraph 2)
The Authority's board is competent to impose the penalties for the Article 262 violations relating to joint stock companies listed on the capital market, and anyone against whom a decision is issued by it has the right to file a grievance before the Committee for the Resolution of Securities Disputes in accordance with the provisions of the Capital Market Law.
This article is consistent with Article 266, which separates the jurisdiction of the competent court from that of the Committee for the Resolution of Securities Disputes depending on whether the company is listed or unlisted. Article 268 gives the employees charged with detecting these acts the status of judicial officers.
Because the period for filing a grievance is short, anyone against whom a penalty decision has been issued should consult a lawyer specializing in commercial matters and companies without delay.
Practical example
An unlisted company in Riyadh was notified of a decision of the Ministry's committee imposing a fine on it for one of the violations provided for in Article 262. If it wishes to object, it must file a grievance before the competent court within 30 days of the date it was notified of the decision.
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 267 of the Saudi Companies Law
How long is the period to challenge a Companies Law fine?
Anyone against whom the committee issued a penalty decision has the right to file a grievance before the competent court within 30 days of the date of notification of it.
Who imposes the penalties for violations on listed companies?
The Authority's board is competent to impose them, and the grievance against its decision is before the Committee for the Resolution of Securities Disputes.
Can a penalty be imposed without referring it to the committee?
Yes. The Minister may specify the violations for which penalties may be imposed directly without referring them to the committee.
Articles this article refers to
More articles on Penalties under the Companies Law
- Article 240
The article makes a foreign company and those who carried on its activity jointly liable if it operated before completing licensing and commercial register registration or went beyond what it was licensed for.
إذا زاولت الشركة الأجنبية نشاطها وأعمالها قبل استيفائها إجراءات الترخيص، إن وجدت، وقيدها لدى السجل التجاري، أو قامت بأعمال تجاوزت المرخص لها فيها، كانت الشركة و
- Article 260
The article punishes with up to 3 years in prison and a fine of up to SAR 5,000,000, or either, anyone who falsifies a company's financial data, uses its funds and powers against its interests, or a liquidator who abuses his role.
دون إخلال بأي عقوبة ينص عليها نظام آخر، يعاقب بالسجن مدة لا تزيد على (ثلاث) سنوات وبغرامة لا تزيد على (5,000,000) خمسة ملايين ريال، أو بإحدى هاتين العقوبتين: أ-
- Article 261
The article punishes with up to 1 year in prison and a fine of up to SAR 1,000,000, or either, acts including buying votes, distributing profits in bad faith, disclosing secrets and overstating the value of stakes.
دون إخلال بأي عقوبة ينص عليها نظام آخر، يعاقب بالسجن مدة لا تزيد على (سنة) وبغرامة لا تزيد على (1,000,000) مليون ريال، أو بإحدى هاتين العقوبتين: أ- كل مراجع للح
- Article 262
The article punishes with a fine of up to SAR 500,000 administrative and regulatory violations, including obstructing assemblies, neglecting records and financial statements, and failing to register in the commercial register.
دون إخلال بأي عقوبة ينص عليها نظام آخر، يعاقب بغرامة لا تزيد على (500,000) خمسمائة ألف ريال: أ- كل من تسبب في تعطيل دعوة الجمعية العامة للشركاء أو المساهمين أو
- Article 263
The article requires taking into account the seriousness, circumstances and effects of the offense or violation when setting the penalty, and doubles the penalties for offenses under Articles 260 and 261 on repetition within 3 years.
1- يراعى في تحديد العقوبة جسامة الجريمة أو المخالفة، وظروفها، وملابساتها، وآثارها. 2- تضاعف في حالة العود العقوبات المقررة على الجرائم المنصوص عليها في المادتين
- Article 264
The article allows the competent judicial authority to take measures such as a warning, requiring correction and a ban from the board of a listed company, in addition to the penalties of Articles 260 and 261 or instead of them.
1- للجهة القضائية المختصة أن تتخذ بالإضافة إلى العقوبات المقررة في المادتين (الستين بعد المائتين) و(الحادية والستين بعد المائتين) من النظام، أو بدلًا عنها؛ أيًّ
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.