Article 13 of the Saudi Cooperative Societies Law
المادة 13 من نظام الجمعيات التعاونية · الباب الثاني: إدارة الجمعيات التعاونية
The article requires every society to have a board of directors of at least five members elected by the general assembly to manage it within its purposes and regulations, with the founders appointing the first board for three years.
Official text (Arabic)
This article has not been amended since the law was issued.
يكون لكُل جمعية مجلِس إدارة، يقوم بكافة الأعمال اللازِمة لإدارتها في حدود أغراضِها ولائحتِها، ويتكون مِن خمسة أعضاء على الأقل، تنتخِبُهم الجمعية العمومية من بين أعضائها، واستثناء من ذلك يُعيِّن المؤسِّسون من بينِهم مجلِس الإدارة الأول لمُدة ثلاث سنوات.
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 13 explained in plain English
This article opens the provisions on the board of directors of the cooperative society and lays down its basis:
First: the board is mandatory, and its role
- Every society has a board of directors.
- It carries out all the work needed to manage it.
- Within its purposes and regulations, so its powers are broad but limited by the society's purposes and regulations.
Second: its composition
- It is made up of at least five members.
- They are elected by the general assembly from among its members, and under Article 1 the general assembly is all the members who contribute to the society's capital.
Third: the exception for the first board
As an exception to the rule of election, the founders appoint from among themselves the first board of directors for three years. The reason is clear: at establishment there is as yet no general assembly in session to elect the board.
This article is linked to Article 12, which provides that the society begins its activity on approval of the announcement, and to Article 14, which sets the term of board membership at four years, renewable, and bars pay for its members while permitting them a bonus of no more than 10% of the annual profits after the statutory deductions.
Anyone facing a dispute over the composition of their society's board or the limits of its powers can consult a lawyer who specializes in commercial and corporate cases.
Practical example
After a cooperative society in Madinah was announced, the founders appointed five of themselves as the board of directors. Under this article, the term of this first board is three years, after which the general assembly elects the board from among its members, with no fewer than five members.
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 contentCommercial & Corporate Law lawyers: ask a specialist about your case
Describe your situation briefly and we'll suggest a lawyer who specialises in this law
Commercial & Corporate Law lawyers
Lawyers who handle this kind of case
Ibrahim Al Salem Law Firm
Active contributor
Dr. Ali Al-Rubaie Law Office and Ittihad Al-Asr Legal Company
Frequently asked questions about Article 13 of the Saudi Cooperative Societies Law
How many members does a cooperative society's board of directors have?
At least five members.
Who elects a cooperative society's board of directors?
The general assembly elects them from among its members, except for the first board, which the founders appoint from among themselves.
What is the term of the first board of directors?
Three years.
More articles on Cooperative Society Board of Directors
- Article 14
The article sets the board of directors' term at four years, renewable, bars pay for its members, and allows the general assembly to grant a bonus of up to 10% of annual profits after the statutory deductions.
مُدة عضوية مجلِس الإدارة أربع سنوات، ويجوز للجمعية العمومية التجديد للمجلس لفترة أخرى أو أكثر ، ويستمر المجلس في ممارسة مهامه وصلاحياته إلى أن يتم تعيين المجلس
- Article 15
The article requires the board, when a member's seat falls vacant for any reason, to add the reserve member who obtained the most votes in the general assembly's ballot, to complete the board's remaining term.
إذا خلا مكان أحد أعضاء مجلِس الإدارة لأي سبَّب، فعلى المجلِس أنَّ يضُم العضو – من بين الأعضاء الاحتياطيين - الذي حاز على أكثر الأصوات في إقتراع الجمعية العمومية
- Article 16
The article requires the board of directors of a cooperative society to elect from among its members, at its first meeting, a chairman, a vice-chairman, a board secretary and a treasurer.
ينتخب مجلِس الإدارة من بين أعضائه رئيساً ، ونائباً للرئيس ، وأميناً للمجلس ، وأميناً للصندوق في أول اجتماع له .
- Article 17
The article requires a majority of the board's members to attend for its meeting to be valid, with decisions made by an absolute majority of those present and the side the chair of the meeting voted with prevailing in a tie.
لايكون انعقاد المجلس صحيحا إلا بحضور أغلبية أعضائه ، وتصدر قراراته بموافقة الأغلبية المطلقة لعدد الأعضاء الحاضرين ، فإذا تساوت الأصوات يرجح الجانب الذي صوت معه
- Article 18
The article gives the board continuous supervision of the society's work and oversight of those who manage it, and gives its chairman the right to sign for and represent the society before others and the courts, with the right to delegate and appoint agents.
1- يقوم مجلِس الإدارة بالإشراف على سير العمل بالجمعية بصِفة مُستمِرة، ومُراقبة من يقوم بالإدارة ، ومن يُمثِلون الجمعية والمُفوضين لأعمال مُعيِّنة . 2 - لرئيس مج
- Article 21
The article requires the board of directors to appoint an executive manager to conduct the society's affairs and to set his powers, duties and rights, and makes the board answerable for his work to the general assembly.
يعين مجلس الإدارة مديرًا تنفيذيًا يقوم بتصريف شؤون الجمعية، ويحدد المجلس اختصاصاته، وواجباته، وحقوقه، ويكون مجلس الإدارة مسؤولاً عن أعمال المدير في مواجهة الجمع
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.