Article 10 of the Saudi Trade Names Law

المادة 10 من نظام الأسماء التجارية · الفصل الثاني: أحكام الاسم التجاري وحجزه وقيده

The article permits the merchant to deal with his entered trade name independently of the business, and the dealing takes effect only after it is entered and published in the Commercial Register.

Official text (Arabic)

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

1- يجوز للتاجر التصرف في الاسم التجاري المقيد تصرفًا مستقلًا عن المتجر، وتحدد اللائحة الأحكام الخاصة بذلك.

2- لا ينفذ التصرف في الاسم التجاري إلا بعد قيده وشهره في السجل التجاري.

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 10 explained in plain English

This article deals with dealing with the trade name, such as selling or assigning it, and contains two rules:

Permission for independent dealing: the merchant may deal with his entered trade name independently of the business; that is, the name can be transferred without transferring the shop or the activity itself. The Implementing Regulations set the rules on that.
Condition of effectiveness: a dealing with the trade name takes effect only after it is entered and published in the Commercial Register. The agreement between the two parties alone is not enough for the dealing to take effect; entry and publication must be completed.

Note that the article speaks of the entered name, and the details and procedures of the dealing are left to the Implementing Regulations.

This article differs from Article 11, which deals with the case of the trade name passing with the business, and what follows from that in terms of the transfer of rights and obligations and the joint liability of predecessor and successor towards creditors. It also differs from Article 9, which regulates the merchant's modification of his trade name.

If you intend to buy or sell a trade name, it is advisable to consult a lawyer specializing in commercial cases to draft the agreement and complete the entry and publication procedures.

Practical example

Saad owns a well-known trade name for a perfume shop in Makkah, and decided to close his shop and sell the name alone to a company in Jeddah. He may do so because the name is entered, but the sale takes effect only after it is entered and published in the Commercial Register, and the Implementing Regulations set the rules for this dealing.

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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