Article 41 of the Saudi Companies Law

المادة 41 من نظام الشركات · الفصل الثالث: إدارة شركة التضامن

Article 41 bars a non-managing partner in a general partnership from interfering in management, gives them the right to inspect and examine records twice a year, and voids any contrary agreement.

Official text (Arabic)

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

لا يجوز للشريك غير المدير أن يتدخل في إدارة الشركة. ويجوز له -أو لمن يفوّضه- أن يطلع مرتين خلال السنة المالية على سير أعمال الشركة، وأن يفحص سجلاتها ووثائقها، وأن يستخرج بيانًا موجزًا عن حالة الشركة المالية من واقع هذه السجلات والوثائق، وأن يقدم الآراء إلى مدير الشركة. وكل اتفاق على غير ذلك يعد كأن لم يكن.

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 41 explained in plain English

This article balances the non-managing partner's right to know the company's affairs with the manager's right to manage it without interference.

First: the bar on interference. A partner who does not take on management may not interfere in the company's management.

Second: the right of oversight. They may, themselves or through someone they delegate, do the following twice during the financial year:

Inspect the progress of the company's business.
Examine its records and documents.
Obtain a brief statement of the company's financial position from these records and documents.
Give their opinions to the company's manager.

Third: a mandatory rule. The article provides that any agreement to the contrary is considered as if it had never been made, so the partner may not be deprived of these rights by the formation contract or otherwise, nor may it be agreed to give them the right to interfere in management contrary to this rule.

Article 42 follows to regulate the removal of the manager and the majority of the resolution required for it according to the manner of their appointment.

If you are refused your right of inspection, it is advisable to consult a lawyer specialized in company and commercial matters.

Practical example

Noura is a partner in a general partnership company in Riyadh who does not manage it, and she wanted to confirm the company's financial position. She is entitled, herself or through an accountant she delegates, to inspect the progress of business, examine the records, and obtain a brief statement twice during the financial year, and to give her opinions to the manager, but she may not give instructions to employees or sign contracts in the company's name.

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 41 of Companies Law?

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