Article 9 of the Saudi Cooperative Societies Law
المادة 9 من نظام الجمعيات التعاونية · الباب الأول: أحكام عامة
The article sets the particulars a cooperative society's founding contract must contain, such as date of drafting, founders' names, the society's name, seat, type, purposes, capital and nominal share value.
Official text (Arabic)
This article has not been amended since the law was issued.
يجب أن يتضمن عقد تأسيس الجمعية ما يأتي:
1 - تاريخ ومكان تحريرِه.
2 - أسماء المؤسَّسين ومحال إقامتِهم ومهنِهم.
3 - اسم الجمعية.
4 - مقر الجمعية ومنطِقة عملِها.
5 - نوع الجمعية وأغراضِها.
6 - قيمة رأس المال والقيمة الاسمية لكُل سهم.
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 9 explained in plain English
This article sets the minimum particulars that the society's founding contract must contain, which are six:
- The date and place of its drafting.
- The names of the founders, their places of residence and their occupations.
- The name of the society.
- The society's seat and area of work.
- The type of society and its purposes.
- The amount of capital and the nominal value of each share.
The text is mandatory («must contain»), so omitting any of these particulars leaves the contract short of what the Law requires.
The importance of these particulars is practical: they establish the society's identity (name, type and purposes), its geographical scope (seat and area of work), its financial basis (capital and share value), and who stands behind it (the founders).
This contract is prepared by the founders defined in Article 8, who are the persons who take part in forming the society and prepare the preliminary founding contract and the basic regulations, and who jointly bear the founding expenses.
The founding contract differs from the basic regulations governed by Article 10. The regulations are more detailed, containing in particular the conditions of membership and members' duties, the conditions for nomination to the board of directors and its powers, the general assembly's powers, the financial year, the rules for distributing profits and settling losses, and the rules for merger, dissolution and liquidation.
Anyone preparing a founding contract for a cooperative society can use a lawyer who specializes in commercial and corporate cases to review it.
Practical example
In preparing the founding contract of a cooperative society for beekeepers in Al-Baha, the founders must state the date and place of drafting the contract, their names, places of residence and occupations, the society's name, seat and area of work, its type and purposes such as producing and marketing honey, and the amount of capital and the nominal value of each share.
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 9 of the Saudi Cooperative Societies Law
What particulars are required in a cooperative society's founding contract?
The date and place of drafting, the founders' names, places of residence and occupations, the society's name, seat and area of work, type and purposes, and the amount of capital and the nominal value of each share.
What is the difference between the founding contract and the basic regulations?
The founding contract contains the six basic particulars, whereas the basic regulations govern in more detail membership, the board of directors, the general assembly, profits and dissolution, according to Article 10.
More articles on Establishing and Registering the Cooperative Society
- Article 3
The article requires a society to have at least twelve individuals and caps each member's holding at 10% of capital, with establishment by at least five members allowed exceptionally with a 20% cap.
تتكون الجمعية من أفراد لا يقل عدَّدُهم عن اثني عشر شخصاً، ولكُل عضو أنَّ يمتلِك عدَّدا من الأسهُم، بشرط ألا يزيد ما يمتلِكُه العضو الواحد عن (10%) من رأس مال ال
- Article 4
The article provides that a cooperative society acquires legal personality on completing registration, announcement and publication in two local newspapers, and may set up branches with a Ministry license under the Regulations' controls.
تكتسِب الجمعية الشخصية الاعتِبارية بمُجرد إتمام عمليتي التسجيل والإشهار المنصوص عليها في هذا النِظام، والنشر عن ذلك في صحيفتين محليتين. ويجوز للجمعية أن تنشئ له
- Article 8
The article identifies the society's founders and their task of preparing the preliminary founding contract and basic regulations, makes them jointly bear founding expenses, repaid from capital after registration, with no recourse if the society cannot be formed.
يُعد الأشخاص الذين يشترِكون في تكوين جمعية تعاونية مؤسَّسين لها، وهُم الذين يتولون إعداد عقد التأسيس الابتدائي، واللائحة الأساسية للجمعية. ويتحملون بالتضامُن ما
- Article 10
The article requires every cooperative society to have basic regulations that include in particular the society's particulars, capital, membership conditions, board of directors, general assembly, profits and dissolution.
يكون لكُلِ جمعية لائحة أساسية تعد وفقا لأحكام هذا النظام متضمنة -على الأخص - ما يأتي: 1 - اسم الجمعية، ومنطِقة عملِها ، ومقرها والغرض أو الأغراض التي أنشئت من أ
- Article 11
The article requires a society's founders to apply to the Ministry for registration, attaching seven documents, including the feasibility study, the founding contract, the basic regulations and the receipt for depositing the share value.
على مؤسِّسي الجمعية التقدُّم للوزارة بطلب تسجيل الجمعية، على أنَّ يُرفق بِه المُستندات الآتية: 1 - دراسة جدوى تأسيس الجمعية . 2 - محضر اجتِماع المؤسِّسين. 3 - ن
- Article 12
The article governs the Ministry's review of registration documents and announcement or refusal within 60 days, failing which the announcement is deemed to have taken place, and gives the founders the right to appeal a refusal to the Minister within 60 days.
تقوم الوزارة بمُراجعة المُستندات الواردة في المادة (الحادية عشرة) من هذا النظام ، فإذا كانت مستوفية لمتطلبات هذا النِظام قامت بإتمام إجراءات الإشهار، وإلا فلها
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.