Article 271 of the Saudi Companies Law
المادة 271 من نظام الشركات · الباب الثالث عشر: العقوبات
The article requires all officials in the company to give the Ministry's representatives, and the Authority's for listed or soon-to-be-listed joint stock companies, access to its records and documents and to provide information and clarifications.
Official text (Arabic)
This article has not been amended since the law was issued.
على جميع المسؤولين في الشركة أن يُطلعوا ممثلي الوزارة، وممثلي الهيئة إذا كانت شركة مساهمة مدرجة في السوق المالية أو تسعى إلى ذلك، كل بحسب اختصاصه، فيما يتعلق بالأعمال المنصوص عليها في المادة (السبعين بعد المائتين) من النظام؛ على كل ما يطلبونه من سجلات الشركة ووثائقها، وأن يقدموا لهم كل المعلومات والإيضاحات المتعلقة 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 271 explained in plain English
This article places a direct duty on all officials in the company to cooperate with the supervisory authorities when they exercise their supervision over the company.
This duty consists of two things:
- Enabling access: They must give the supervisory authority's representatives access to everything they request of the company's records and documents.
- Providing information: They must give them all the information and clarifications relating to that.
The bodies to which this cooperation is owed under the article are:
- the Ministry's representatives, according to their jurisdiction;
- the Authority's representatives if the company is a joint stock company listed on the capital market or seeking to be listed, according to their jurisdiction.
This duty is linked to the acts provided for in Article 270, which gives the competent authority the right to supervise companies in applying the provisions of the Law and the articles of association or bylaws, including inspecting the company, examining its accounts and requesting data, records, documents and minutes from the managers, board or executive management, through representatives from its staff or experts it chooses, and sending an observer to attend general assemblies. Article 270 establishes the supervisory power, and this article establishes the corresponding obligation on the company's officials.
The phrase "everything they request" is broad, but it is limited by the request needing to relate to the supervisory acts in Article 270 and to fall within each authority's jurisdiction.
If your company faces a practical situation relating to this rule, it is appropriate to consult a lawyer specializing in commercial matters and companies.
Practical example
A representative of the supervisory authority visited a limited liability company in Riyadh to examine its accounts, and requested the minutes of the partners' meetings and the account statements. Under this article the company's manager and officials must allow him access to these documents and provide the clarifications he requests about them.
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 271 of the Saudi Companies Law
Must a company let the Ministry of Commerce see its records?
Yes. The article requires all officials in the company to give the Ministry's representatives access to everything they request of the company's records and documents in relation to the supervisory acts in Article 270.
When are the Authority's representatives entitled to see a company's records?
If the company is a joint stock company listed on the capital market or seeking to be listed, according to the Authority's jurisdiction.
Is it enough just to hand over the documents?
No. The article also requires the officials to provide all the information and clarifications relating to what is requested of them.
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.