Article 39 of the Saudi Cooperative Societies Law
المادة 39 من نظام الجمعيات التعاونية · الباب الثامن: حل الجمعية وتصفيتها
The article requires a summary of the liquidation account to be published in a local newspaper, allows any member to challenge it before the Minister within 30 days, and requires the Minister to decide within 30 days.
Official text (Arabic)
This article has not been amended since the law was issued.
ينشر ملخص حساب التصفية في إحدى الصحف المحلية ، ويجوز لأي من أعضاء الجمعية الطعن فيه أمام الوزير خِلال ثلاثين يوماً من تاريخ النشر ، وعلى الوزير الفصل في الطعن خِلال (ثلاثين) يوماً من تاريخ تقديمه .
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 39 explained in plain English
This article adds safeguards of transparency and the right to object at the liquidation stage.
First: publication
A summary of the liquidation account is published in one of the local newspapers, so that members and others know of it.
Second: the right to challenge
- Any member of the society may challenge the liquidation account.
- The challenge is made before the Minister.
- Within 30 days of the date of publication.
Third: time limit for deciding
The Minister must decide the challenge within 30 days of the date it is submitted. The text is mandatory ("the Minister must").
Note that the period for challenging starts from the date of publication, not from the date the member personally learns of it, so following the publication matters to anyone who wants to challenge. The article does not state the consequence if the Minister does not decide the challenge within the period.
The liquidation account is the final account that Article 38 provides is to be prepared by the liquidator the Ministry appoints when the society is dissolved, after he collects the society's rights and pays its debts, and it is reviewed in accordance with Article 20.
Article 40 then sets out how the proceeds of liquidation are distributed to the members, in an amount not exceeding what they actually paid as the price of their shares plus the profits realized, with the remainder deposited toward establishing a new cooperative society or transferred, by decision of the Minister, to a society carrying on the same activity or the closest to it.
Anyone who wants to challenge a liquidation account may consult a lawyer specializing in administrative cases so as to observe the time limit.
Practical example
A summary of the liquidation account of a cooperative society in Dammam is published in a local newspaper, and one member thinks the value of his shares was not calculated correctly. Under this article, he may challenge the account before the Minister within 30 days of the date of publication, and the Minister must decide his challenge within 30 days of its submission.
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 39 of the Saudi Cooperative Societies Law
How do I object to the liquidation account of a cooperative society?
Any member may challenge it before the Minister within 30 days of the date its summary is published in the local newspaper.
When does the Minister decide the challenge?
The Minister must decide the challenge within 30 days of the date it is submitted.
Where is the liquidation account published?
A summary of it is published in one of the local newspapers.
More articles on Dissolving and Liquidating the Cooperative Society
- Article 25
The article governs the extraordinary meeting of the general assembly: who can call it, its cases such as amending the regulations, disposing of real estate, dissolution, merger and division, and its quorum of a majority of the contributing members.
تعقد الجمعية العمومية اجتماعا غير عادي بدعوة من مجلس الإدارة، أو من مراجع الحسابات، أو بطلب من ثلث أعضائها على الأقل، أو بدعوة من الوزارة، وذلك لبحث إحدى الحالا
- Article 37
The article gives the Minister the right to dissolve a society and liquidate it in six cases, including not starting work for two years, losing more than half the paid-up capital, too few members, and a general assembly decision by three quarters of the shareholders.
للوزير الحق في حل الجمعية وتصفية أعمالِها في أي من الحالات الآتية: 1 - إذا مضت سنتان على تاريخ نشر تسجيلها وإشهارها ولم تباشر عملها . 2 - إذا بلغ مجموع خسائرِها
- Article 38
The article provides that on dissolution of a society the Ministry appoints one or more liquidators, who collect its rights and pay its debts, limit their work to finishing existing business, and prepare a final account reviewed under Article 20.
في حالة حل الجمعية، تُعيِّن الوزارة مُصفي أو أكثر لتصفيتِها. ويقوم المُصفي بإجراء كافة التصرُفات النِظامية اللازِمة لاستيفاء حقوق الجمعية والوفاء بديونِها ، لتح
- Article 40
The article provides that liquidation proceeds are distributed to members up to what they actually paid for their shares plus profits realized, with the remainder deposited toward a new society or transferred by the Minister to a similar society.
يوزع ناتج التصفية على الأعضاء، بحيث لا تتجاوز قيمة ما دفعُه الأعضاء فعلاً ثمناً لأسهُمهم وماتحقق من أرباح ، ويودع الباقي في أحد المصارِف على ذمة إنشاء جمعية تعا
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.