Article 34 of the Saudi Finance Companies Control Law
المادة 34 من نظام مراقبة شركات التمويل
The article permits the Authority to impose a fine not exceeding SAR 250,000 for the violations in Article 29, and a fine not exceeding SAR 10,000 for each day the violation continues.
Official text (Arabic)
This article has not been amended since the law was issued.
تفرض المؤسسة غرامـة مالية لا تتجاوز (250.000) مائتين وخمسين ألف ريال عند ارتكاب أي من المخالفات المنصوص عليها في المادة (التاسعة والعشرين) من هذا النظام، وعند استمرار المخالفة يجوز للمؤسسة فرض غـرامـة مالية لا تتجاوز (10.000) عشرة آلاف ريال عن كل يوم تستمر فيه المخالفة.
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 34 explained in plain English
This article specifies the financial fines that the Authority imposes on finance companies within the scope of Article 29:
- The principal fine: not exceeding SAR 250,000 on committing any of the violations provided in Article 29.
- The daily fine: where the violation continues, the Authority may impose a fine not exceeding SAR 10,000 for each day the violation continues.
Referring back to Article 29, the violations meant are those relating to professional misconduct or to dealings that put the company's shareholders or creditors at risk, or the case where the company's debts exceed its assets. Article 29 lists the fine provided in this article among the measures the Authority takes by written decision and in proportion to the size of the violation, and it may be combined with other measures such as a warning or barring profit distribution.
The two amounts stated are maximum limits; the Authority assesses the fine without exceeding them. The daily fine is discretionary ("may"), and its purpose is to push the company to remove the violation quickly.
It is followed by Article 35, which provides other penalties, including a fine for delay in paying a debt and a penalty for violating the provisions of the Law and its Implementing Regulations, and provides that this is without prejudice to what this article provides. It is preceded by Article 33 on early repayment.
If a fine is imposed on a company, consult a lawyer who specializes in banking and finance.
Practical example
The Authority found that a finance company in Jeddah had committed professional misconduct that puts its creditors at risk, so it imposed a fine of SAR 150,000 on it, which is below the maximum. When the violation continued for ten days, the Authority could impose a fine not exceeding SAR 10,000 for each day of it.
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 34 of the Saudi Finance Companies Control Law
What is the maximum fine for a finance company's violation under this article?
It does not exceed SAR 250,000 on committing any of the violations provided in Article 29.
Is there a daily fine for a continuing violation?
Yes. Where the violation continues, the Authority may impose a fine not exceeding SAR 10,000 for each day it continues.
Articles this article refers to
More articles on Finance Company Violations and Penalties
- Article 4
The article bars carrying on finance activities or using anything indicating them without a license, and excepts a person financing the goods or services of his establishments to his customers as the Regulations provide.
1- تحظر مزاولة أي من نشاطات التمويل المحددة في هذا النظام إلا بعد الحصول على ترخيص بذلك وفق أحكام هذا النظام، أو الأنظمة المرعية الأخرى. 2- يحظر على أي شخص غير
- Article 29
The article sets the measures the Authority takes by written decision against a violating finance company or one whose debts exceed its assets, and requires it to file an action if it considers revoking the license or liquidation appropriate.
إذا ارتكبت الشركة مخالفات تتعلق بتجاوزات مهنية أو بتعاملات تعرض مساهميها أو دائنيها للخطر، أو إذا تجاوزت ديون الشركة أصولها؛ فعلى المؤسسة - بقرار كتابي وبما يتن
- Article 35Amended by M/24
The article provides a fine for a debtor who defaults on his debt, a fine or imprisonment for violators of the Law, precautionary attachment of the property of whoever violates Article 4, and publication of a summary of the judgment.
1- يعاقب كل من ثبتت مماطلته في الوفاء بدينه بغرامة مالية، على ألا تتجاوز تلك الغرامة ضعف ربح الالتزام محل المماطلة لمدتها، وتتكرر العقوبة بتكرار المماطلة وتودع
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.