Article 80 of the Saudi Companies Law

المادة 80 من نظام الشركات · الفرع الأول: مجلس الإدارة

The article requires a joint stock company's board to meet at least four times a year, sets the quorum, the majority for resolutions and the chairman's casting vote, and allows meetings by modern technology.

Official text (Arabic)

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

1- يجتمع مجلس إدارة شركة المساهمة (أربع) مرات على الأقل في السنة بدعوة من رئيسه وفقًا للأوضاع المنصوص عليها في نظام الشركة الأساس، وللجهة المختصة تعديل الحد المنصوص عليه في هذه الفقرة. ويجب على رئيس المجلس دعوة المجلس إلى الاجتماع متى طلب إليه ذلك كتابةً أي عضو في المجلس لمناقشة أي موضوع أو أكثر.

2- لا يكون اجتماع مجلس إدارة شركة المساهمة صحيحًا إلا إذا حضره نصف الأعضاء (أصالة أو نيابة) على الأقل، ما لم ينص نظام الشركة الأساس على نسبة أكبر.

3- تصدر قرارات مجلس إدارة شركة المساهمة بأغلبية أصوات الأعضاء الحاضرين (أصالة أو نيابة) على الأقل، وعند تساوي الأصوات يرجح الجانب الذي صوت معه رئيس الاجتماع، وذلك ما لم ينص نظام الشركة الأساس على غير ذلك.

4- يحدد مجلس الإدارة مكان عقد اجتماعاته، ويجوز عقدها باستخدام وسائل التقنية الحديثة.

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 80 explained in plain English

This article sets the rules for how the board of a joint stock company operates in its meetings.

1- Number of meetings and the call:

The board meets at least (4) times a year on the call of its chairman, as the articles of association provide. The competent authority may change this minimum.
The chairman must call the board whenever any member requests it in writing to discuss one or more subjects.

2- The quorum: A meeting is valid only if at least half of the members attend, in person or by proxy, unless the articles of association require a higher proportion.

3- Issuing resolutions:

They are issued by a majority of the votes of the members present, in person or by proxy, at least.
When the votes are tied, the side the chairman of the meeting voted with prevails.
All this unless the articles of association provide otherwise.

4- Place and means: The board decides the place of its meetings, and they may be held using modern technology.

The article refers to attendance "by proxy", and Article 81 explains the rule on proxies: as a general rule a member may not appoint someone else to act for him, and as an exception a member may appoint another member if the articles of association so provide, provided that the member acting as proxy holds no more than one proxy. Article 79 regulates representing the company before the courts and third parties, which is separate from the quorum of meetings. If the validity of a board resolution is challenged, it is advisable to consult a lawyer specialized in companies.

Practical example

The board of a joint stock company in Riyadh has 6 members, and its articles of association do not require a higher quorum. Three members attended by video call, so the meeting was valid because they are half of the members. One member voted for the resolution and one against, and the chairman of the meeting voted for the resolution, so it was passed by a majority of those present.

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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