Article 273 of the Saudi Companies Law
المادة 273 من نظام الشركات · الباب الرابع عشر: أحكام ختامية
The article provides that the provisions of the Companies Law apply to stakes and shares owned by an endowment (waqf).
Official text (Arabic)
This article has not been amended since the law was issued.
تسري أحكام النظام على الحصص أو الأسهم التي تعود ملكيتها إلى وقف.
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 273 explained in plain English
This article is short, but it settles a practical question: what is the rule if stakes in a company or shares in it are owned by an endowment (waqf)?
The article provides that the provisions of the Companies Law apply to these stakes and shares. In practice this means:
- That the owner of the stake or share being an endowment does not remove it from the provisions of the Law.
- That what the Law provides for stakes and shares generally applies to them, depending on the type of company to which these stakes or shares belong.
The article does not set special rules for managing the endowment itself or for whoever represents it, and it does not address the rules on endowments in other laws; it is limited to stating that stakes and shares whose ownership belongs to an endowment are subject to the Companies Law.
Related articles include Article 272, which deals with companies formed by the State or persons with public legal personality if their formation requires an exception from the Law, and Article 274, which sets out the powers of the competent authority. Unlike Article 272, this article does not mention any exception for endowment stakes or shares.
The administrator of an endowment, or anyone dealing with endowment stakes in a company, may consult a lawyer specializing in commercial matters and companies to learn the provisions that apply to the company concerned.
Practical example
A charitable endowment in Makkah owns stakes in a limited liability company. Under this article, these stakes are subject to the provisions of the Companies Law like any other stakes in the company.
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 273 of the Saudi Companies Law
Does the Companies Law apply to endowment shares?
Yes. The article provides that the provisions of the Law apply to stakes or shares whose ownership belongs to an endowment.
Do endowment shares have a special exception in the Companies Law?
This article mentions no exception; it provides that the provisions of the Law apply to these stakes and shares.
More articles on Company Formation
- Article 1
This article defines the key terms of the Companies Law, such as the Ministry, the Authority, the competent authority, relatives and day, and leaves the definition of other terms to the regulations.
1- يقصد بالكلمات والعبارات الآتية -أينما وردت في هذا النظام- المعاني الموضحة أمام كل منها، ما لم يقتضِ السياق غير ذلك: المملكة: المملكة العربية السعودية. النظام
- Article 2
Article 2 defines a company as a legal entity in which two or more persons contribute to a profit-seeking venture to share its profit and loss, and allows a company to be formed by one person or as a non-profit.
الشركة كيان قانوني يؤسس وفقًا لأحكام النظام بناء على عقد تأسيس أو نظام أساس يلتزم بمقتضاه شخصان أو أكثر بأن يساهم كل منهم في مشروع يستهدف الربح بتقديم حصة من ما
- Article 3
Article 3 provides that every company formed under the Companies Law is of Saudi nationality and must have its principal center in the Kingdom.
تعد الشركة التي تؤسس وفقًا لأحكام النظام سعودية الجنسية، ويجب أن يكون مركزها الرئيس في المملكة.
- Article 4
Article 4 sets out the five forms, one of which every company formed under the Companies Law must take.
تتخذ الشركة التي تؤسس وفقًا لأحكام النظام أحد الأشكال الآتية: أ- شركة التضامن. ب- شركة التوصية البسيطة. ج- شركة المساهمة. د- شركة المساهمة المبسطة. هـ- الشركة ذ
- Article 5
The article regulates a company's trade name: its language and sources, the former partner's consent to the use of his name, the indication of the company's form, and amendment of the name without affecting its rights and obligations.
1- يكون لكل شركة اسم تجاري باللغة العربية أو بلغة أخرى، ويجوز أن يكون الاسم مشتقًا من غرضها، أو اسمًا مميزًا، أو اسم واحد أو أكثر من الشركاء أو المساهمين فيها ا
- Article 6
Article 6 states who counts as a founder, regulates submitting the formation application to the commercial register, and gives founders the right to appeal a refusal to the Ministry and then to the competent judicial body.
1- يعد مؤسسًا كل من اشترك فعليًّا في تأسيس الشركة وساهم في رأس مالها بحصة نقدية أو عينية. 2- يقدم المؤسسون طلب تأسيس الشركة وقيدها إلى السجل التجاري، مرافقًا له
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.