Based on Law No. (6) of 2005 Regulating Dubai Courts and its amendments; Law no. (13) of 2016 concerning the Judicial Authority in the Emirates of Dubai; Federal Law No. 10 of 1992 on the Issuance of the Evidence Act for Civil and Commercial Transactions; Federal Law No. (1) of 2006 on Electronic Commerce and Transaction and its amendments; Federal Law No. 5 of 2017 on the Use of Remote Communication Technology in Criminal Proceedings; the Resolution of Minister of Justice No. 260 of 2019 on the Procedural Handbook of Organizing the Remote Litigation using Electronic means and Remote Communication in Civil Proceedings; and Resolution No. (33) of 2020 on Adjourning Judicial Hearings and Remote Work in Dubai Courts, and upon the directions of the Executive Council and the recommendation made at meeting of the Leadership Council for Development and Institutional Innovation in Dubai Courts No. 3/2020 dated 14/04/2020, and in support of determined efforts and precautionary measures to ensure the highest levels of health and safety for all Dubai Courts customers, and pursuant to what was been presented to us, and in the best interest of work in the light of corona crisis, we have decided the following,

Dubai Courts Electronic Servives

Article (1)

1. Lawyers or customers wishing to benefit from court services shall use electronic systems of Dubai Courts Department or log in to smart application system.
2. A natural person shall register in “Al Salifa” system with a verified user account, through all available registration channels, when submitting any application, order,case or appeal to Dubai courts.

Filling Lawsuits, Requests and Amicable Settlements

Article (2)

 

All lawsuits, applications or amicable settlements shall be remotely through law firms or outsourcing offices or via the courts e-system.

Family Guidance and Divorce Certification

Article (3)

1. Family guiance cases shall be filed and divorce certificate shall be established remotely.
2. Family counsel shall send a WhatsApp message to the parties including the date and time of the session, the documents required to be prepared by each party, and the action according to the legal proceedings.
3. On the session day, the family conselor shall make a conference call using the office telephone or mobile phone, by entering the phone number of the plaintiff, the defendant and the interpreter if either or both parties are foreigners.

Marriage Contracts, Certificates and Attestations

 

Article (4)

 

1. Marriages shall be concluded by legal marriage officers. Legal Marriage officer may use remote communication technology to conclude marriage contracts with the parties, whether in their presence in one real sitting- after obatining the necessary permits- or online through the use of the remote commucnication technology.
2. In respect of legal certifications and attestations, applications shall be filed and relevant fees ashall be paid remotely. The legal attestation officer shall communicate with the parties and witnesses, check their identity and verify the completion of all required documents, and issue the attestation and send it electronically to the applicant via e-mail.

Summons and Details of the Parties

 

Article (5)

 

1. All Judicial summons, whether at the time of filing cases or notification of judgments or executive deed shall be served by SMS, e-mail or other electronic means.
2. Data derived from the smart log in account shall be adopted and used to summon the account holder of all petitions, orders, claims and appeals subsequent to the date of the account creation and submitted by or against him, and the same way in no case be denied or refuted.
3. Data derived from the smart log in account must contain the following: Username, ID number, email address, mobile number, home address, business address (if any), and any other additional information.
4. Registration departments shall, according to their respective cpmpetence verify the conformity of all data and addresses provided by the applicant with the data and addresses adopted through the smart log in system in respect of all relevant parties, and shall make the necessary corrections therein.
5. Any lawyer who submits applications for registration on behalf of his/her individual or corporate clients, must provide the Courts Deparment with particulars of his/her client (copy and details of the ID, email address and mobile number in case of individuals and copy and details of the commercial license and office number in case of companies), in addition to his/her details and addresses.

Case Remote Management

 

Article (6)

 

1. The Case Department shall follow up the preparation of all cases remotely through video or audio communication technology.
2. Video or audio commucation technology shall include remote attendance, exchange of documents and issuance of necessary decisions.
3. Attendances and proceedings shall be recorded in the transcript of hearing.

Case Remote Consideration

 

Article (7)

 

1. Remote communication technology shall be used in considering all cases hearings in first instance, appeal and cassation courts, including remote attendance, exchange of documents, hearing witnesses, deliberation, and issuance of decisions and rulings.
2. Hearing attendance and procedures shall be recorded in transcript of hearing.
3. Case files shall administratively adjourned in case a litigant fails to remotelty attend hearings for any reason. The same applies to cases referred to experts.
4. In order to preserve the lights of litigants, no case shall be dismissed even if a litigants fails to electronically attend the hearings, taking into account the current circumtances.

Remote Expertise

Article (8)

1. Expert appointment order or decision shall be electronically sent from the competent court to Advocates, Experts and Interpreters Affairs Department, and expert fees shall be deposited remotely through the electronic payment portal available on Dubai Courts website.
2. Advocates, Experts and Interpretaers Affairs Department shall delegate an expert using the electronic system.
3. The Expert shall accept the assignment through the electronic system and shall review the case file electronically.
4. If meetings are required with the expert, the expert shall hold the same through the video conferencing system used in court’s circuit or any video conferencing system used at the expert’s office, after iniviting the parties electronically, by sending a link to remote attendance and specifying the time of the meeting, so that the parties can attend the expert meetings via the video conferencing technology by a simple click on such link.
5. The expert may submit requests to the competent court and file its report through the electronic system.
6. The expert shall submit a request for disbursement of the expert fees and through the electronic system.

Execution and Enforcement of Judgments

Article (9)

1. All applications shall be submitted abd lawsuits and execution cases shall be filed remotely through law firms, via the electronic case management system (Al Salifa), or by using the smart log in system (smart applications) if filled by the litigants themselves.
2. Cases and applicants for execution shall be considered remotely through the electronic system of courts and the video communication program. Persons detained in police stations and penitentiary facilities shall be interrogated via video calls.
3. Applications for paying judged amounts in installments and allowing wanted persons times and applications for attachment in execution files or cancellation of attachment shall be entertained remotely together with travel ban or ban lifting decisions through the direct link to the G.H.Q of Dubai Police.
4. Execution amounts shall be deposited remotely through (ldhafa) online portal for e-disbursement service into the bank account of the judgment creditor.
5. Parenting time and visitation orders shall be enforced only (through) online visitation using video communication program of courts or competent entities.

Criminal Cases

Article (10)

 

1. All criminal cases shall be entertained, and detentions shall be extended using remote communication technology.
2. The defendant’s lawyer may appear with his/her client during trial via remote communication technology.
3. If the defendant is a foreigner and is not fluent on Arabic, the court shall seek the assistance of an interpreter via the remote interpretation rrom.
4. Courts shall coordinate with Oublic Prosecution and detention places in respect of remote consideration of crminal cases and extension of detention.

Article (11)

All sectors and departments of Dubai Courts shall, according to their respective copmpetences take the technical, material and administrative measures necessary to implement the provisions of this Resolution.

Article (12)

This Resolution shall come into force on 19/4/2020, shall be circulated among those concerned with its implementation and shall be published on Dubai Courts website.

For Dubai Courts President

//signed & stamped//

Dubai Courts

Virtual Courts’ hearings Dubai Courts

 

Preamble
We, Khalifah Bin Zayed Al Nahyan, President of the United Arab Emirates State,
Pursuant to the perusal of the Constitution; and:
Federal Law No. (1) of 1972 On the Jurisdiction of the Ministries and the Powers of the
Ministers and its amending laws;
Federal Law No. (10) of 1973 On the Federal Supreme Court and its amending laws;
Federal Law No. (6) of 1978 On the Establishment of Federal Courts and the Transfer of
the Jurisdictions of the Local Courts in Some of the Emirates to These Federal Courts and
its amending laws;
Federal Law No. (17) of 1978 On Organization of the Cases and Procedures of Appeal in
Cassation Before the Federal Supreme Court and its amending laws;
Federal Law No. (3) of 1983 On the Federal Judicial Authority and its amending Laws;
The Penal Law issued by Federal Law No. (3) of 1987;
The Civil Transactions Law issued by Federal Law No. (5) of 1985 and its amending
laws;
Federal Law No. (22) of 1991 On the Notary Public and its amending laws;
The Law of Evidence in Civil and Commercial Transactions, issued by Federal Law No.
(10) of 1992;
The Law on Civil Procedures, issued by Federal Law No. (11) of 1992;
Federal Law No. (21) of 1997 on Fixing the Dowry in the Contract of Marriage and its
Expenses; and
Acting upon the proposal of the Minister of Justice and Islamic Affairs and Wakfs, the
approval of the Council of Ministers and ratification of the Federal Supreme Council;
We have promulgated the following Law:
Federal Law No. (28) of 2005 On Personal Status
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GENERAL PROVISIONS
Article (1)
1. The present Law shall apply to all facts occurring subsequent to the coming into force of
its provisions.
It shall retrospectively apply to divorce attestations and divorce lawsuits that have not
received final settlement.
2. The provisions of this Law shall apply to citizens of the United Arab Emirates State
unless non-Muslims among them have special provisions applicable to their community
or confession. They shall equally apply to non-citizens unless one of them asks for the
application of his law.
Article (2)
1. In understanding, interpreting or construing the legislative provisions of this Law, the
principles and rules of the Muslim doctrine shall be consulted.
2. The provisions of this Law shall apply to all matters dealt with herein, in words and
context. For the purposes of interpretation and completion of their provisions, the
doctrinal school of thought from which these matters derived shall be consulted.
3. In the absence of a text in this Law, judgment shall be given in accordance with what is
widely known of Malik’s doctrine, then Ahmed’s, then El Shaffei’s, then Abi Hanifa’s
doctrine.
Article (3)
Unless otherwise provided, the lunar computation shall be adopted in calculating the time
limits mentioned in this Law.
Article (4)
In the absence of any text in this Law regulating the procedures of any matter, the
provisions of the Civil Procedures Law and the Law of Evidence in Civil and Commercial
Transactions shall apply.
Federal Law No. (28) of 2005 On Personal Status
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Article (5)
The State courts shall have jurisdiction on Personal Status litigations in which citizens, or
aliens, having a domicile or residence or place of business in the State, are defendants.
Article (6)
The State courts shall have jurisdiction on Personal Status lawsuits raised against an alien
who has not, in the State, a domicile or residence or place of business, in the following
instances:
1) Where the lawsuit is an opposition to a marriage to be contracted in the State.
2) Should the lawsuit concern a claim in rescission or annulment of a marriage, in
repudiation or in divorce and the claim is introduced by either a citizen wife or a wife
having lost her citizenship, whenever any of the two have a domicile or residence in the
State, against her husband who had a domicile, residence or place of business in the State,
whenever the husband had abandoned his wife and established his domicile, residence or
place of business abroad or had been deported from the State.
3) If the lawsuit concerns a claim of alimony to the parents, the wife or the minor whenever
they have in the State a domicile, residence or place of business.
4) Where the lawsuit concerns the affiliation of a child, having in the State a domicile or
residence, or is related to the guardianship on the person or property, whenever the minor
or the person to be interdicted has, in the State, a domicile or residence or if the absent
had therein his last domicile, residence or place of business.
5) Should the lawsuit concern a matter of Personal Status and the plaintiff is a citizen, or an
alien having in the State a domicile, residence or place of business, in case the defendant
has no known domicile or residence in a foreign country or if the national law is, in the
State, the governing law.
6) Where there are more than one defendant and one of them has, in the State, a domicile,
residence or place of business.
7) If he has a domicile of choice in the State.
Federal Law No. (28) of 2005 On Personal Status
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Article (7)
In instances where the State courts have jurisdiction in accordance with Article (6) of this
Law, the court of the plaintiff’s domicile, residence or place of business shall be
competent otherwise the court of the Capital.
Article (8)
1. The first instance court of restricted jurisdiction, composed of a single judge, shall have
jurisdiction to settle Personal Status matters.
2. The authentications’ judge shall authenticate the attestations delivered by the court.
The Minister of Justice and Islamic Affairs and Wakfs shall issue a regulation on the
procedures to be followed in attestations and their authentication.
Article (9)
1. The court of the defendant’s domicile, residence or place of business shall be competent
and, in case there are several defendants, the court of the domicile, residence or place of
business of one of them shall have jurisdiction.
2. The court of the plaintiff’s or defendant’s domicile, residence or place of business, or the
conjugal domicile, shall have jurisdiction to examine the lawsuits introduced by the
children, the wife, the parents or the fostering nurse, as the case may be, in the following
instances:
a) Costs, wages and the like.
b) Fostering, visitation and related matters.
c) Dowry, trousseau, gifts and the like.
d) Divorce, divorce in return of money, discharge, rescission and separation between
spouses of all kinds.
3. The court of the deceased’s last domicile, residence or place of business in the State shall
have jurisdiction to verify the evidence of heredity, wills and liquidation of the estate. If
the deceased has no domicile, residence or place of business in the State, the competent
court shall be the one in whose jurisdiction one of the estate’s immovable property is
situated.
4. In matters of tutelage, the competence ratione loci shall be determined as follows:
Federal Law No. (28) of 2005 On Personal Status
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a) In matters of tutelage, the domicile or residence of the tutor or the minor; in matters
of guardianship, the last domicile or residence of the guardian or that of the minor.
b) In matters of interdiction, the domicile or residence of the interdicted-to-be.
c) In matters of absence, the last domicile, residence or place of business of the absent.
d) In case any of the above-mentioned in paragraphs (a, b, and c) have no domicile or
residence in the State, competence shall be given to the court of the claimant’s
domicile or residence or the court in whose jurisdiction the property of the person to
be protected is located.
e) The court which ordered interdiction, withdrawal or cessation of tutorship shall refer
the case to the court of the minor’s domicile or residence in order to appoint a tutor
or guardian in case the domicile or residence of the minor or the interdicted has
changed.
5. Should the defendant have no domicile, residence or place of business in the State and it
was not possible to designate the competent court, under the foregoing provisions, stated
in the above paragraphs, competence shall be given to the court of the plaintiff’s domicile,
residence or place of business, otherwise to the court of the Capital.
Article (10)
1. Where the law requires an authorisation or approval from the court, or to submit the
matter to the judge, the request for the order shall be submitted to the court of the
applicant’s domicile or residence, unless otherwise provided by law.
2. Every interested person may, within one week from his notification of the order, submit a
grievance against such order; the court shall decide to uphold, amend or cancel it and its
decision shall be subject to appeal by all means specified by law.
3. The application for appointment of a trustee shall be submitted on a request for the order
that has to be notified to the public prosecution and the potential heirs.
Article (11)
Unless otherwise decided by the court, a stay of execution shall not result from the
opposition to the implementation of judgments, summary or provisional decisions, the
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minutes drawn-up or authenticated or the ratified conciliation reports concerning alimony,
fostering; or appeal thereof.
Article (12)
In case of applying for the declaration of absence of a person, the litigation shall be
directed against the potential heirs of the absent, his proxy, the one appointed to represent
him and to the public prosecution.
Article (13)
Where the Court of Cassation quashes the appealed judgment, totally or partially, it shall
have to decide on the merits of the case.
Shall be excepted from the foregoing paragraph:
1) Where the appealed judgment has been cancelled on grounds of nullity, due to a reason
related to the notification of the initial pleadings, the court shall, in addition to the
declaration of nullity, order to return the case to the court of first instance for
examination, after notifying the litigants, considering that the appeal against the
notification judgment concerns the claims submitted in the case.
2) In case the appealed judgment has decided the non-jurisdiction of the court or the
acceptance of an incidental plea that resulted in staying the procedures of examining the
case or in upholding the appealed judgment on these two counts and the Court of
Cassation quashed the appealed judgment, it has to remit the case to the court that has
rendered the appealed judgment unless it decides to transmit to a circuit composed of
other judges or to the competent court for review of the case. The court to which the case
is transmitted has to abide by the decision of the Court of Cassation in the matter settled
by it, unless it is the second appeal, then, should the Court of Cassation quash the
appealed judgment, it has to decide on the merits of the case.
Article (14)
1. The defendant or the person to be notified shall be served the notification at his domicile,
residence, place of business, elected domicile or wherever he is present and if such
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notification is not possible, the court may notify him by fax, electronic mail, registered
mail with acknowledgment of receipt or by any equivalent means.
2. In case the process server does not find the concerned person at his domicile, or residence
he may deliver the notice to any of the persons living with him: spouse, relatives sons-inlaw;
or if he does not find him at his place of business he may deliver it to his superior at
work or one deemed by him as occupying a managerial position. Under all circumstances,
the notice should be delivered only to a person who appears to have completed his
eighteen years of age and who, in person or through a representative, has no apparent
interest in conflict with that of the notified person.
3. If the service processor does not find any of those having the capacity to receive a copy of
the notice or if they refuse to sign the original acknowledging receipt or to take delivery
of a copy of the notice after verifying his identity or if the place is closed, he must deliver,
the same day, the copy to the officer or his substitute in charge of the police station of the
domicile of the person to be served, his residence or place of business, as the case may be.
In addition, the service processor must address by mail to the concerned person, at his
domicile, residence, place of business or elected domicile, a registered letter informing
him that the copy has been delivered to the police station.
4. The Court may, by exception to the foregoing paragraph, order the posting of a copy of
the notice on the bulletin board and on the door of the concerned person’s place of
residence, or of the place of his last residence, or, if necessary, by publishing the notice in
two dailies, issued in the State or abroad in the Arabic or foreign languages, as the case
may be.
5. Where the court has verified that the person to be notified has no domicile, residence,
place of business, fax, E-mail or a postal address, it shall notify through publication in
two dailies issued in the State or abroad in the Arabic or foreign languages, as the case
may be, and the date of the publication shall be considered as the date of notification.
6. As concerns persons who have abroad a known domicile, residence or place of business,
copy of the notice shall be delivered to deputy – minister of Justice to be notified to them
through diplomatic channels or by registered mail with acknowledgement of receipt.
Federal Law No. (28) of 2005 On Personal Status
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7. Publication of the notice shall be effective as of the date of notifying the copy,
dispatching of the Fax or E-mail, reception of the registered mail with acknowledgement
of receipt or as of the date of publication, in accordance with the foregoing provisions.
Article (15)
1. A judgment shall be notified to the condemned person either at his domicile, place of
business or residence, otherwise through the means specified in Article (14) of this Law,
upon order of the Court that has rendered the judgment or upon request from the party in
whose favour the judgment was rendered.
2. The period set for appeal of the judgment shall start the day following the date of its
issuance if given in the presence of the parties, or the day following notification of the
losing party if the judgment was given in the supposed presence of the parties.
3. The period set for appeal and for further appeal to the Court of Cassation is thirty days for
each.
4. The party in whose favour a judgment has been rendered for divorce, separation,
rescission, nullity of a contract or declaration of death of the absentee, must notify the
judgment to the losing party or the party against whom the judgment was rendered, as if
he was present, in order that the periods of appeal start to run.
Article (16)
1. The lawsuit concerning personal status matters shall not be admitted before the court
unless it has previously been submitted to the Family Orientation Committee. Are
excepted from this provision, matters concerning wills, inheritance and like matters,
summary and provisional lawsuits concerning alimony, fostering, guardianship as well as
cases that cannot be settled by conciliation such as evidence of marriage or divorce.
2. Where conciliation between the parties takes place before the Family Orientation
Committee, it shall be recorded in a minutes signed by the parties and the competent
member of the Committee. The minutes shall be sanctioned by the competent judge,
enforced as an executory deed and shall not be subject to any means of appeal except if it
is in violation to the provisions of this Law.
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3. The Minister of Justice, Islamic Affairs and Wakfs shall issue the implementing
regulation organising the work of the Family Orientation Committee.
BOOK ONE. MARRIAGE
Title One. Engagement
Article (17)
1. Engagement is a request and a pledge for marriage but is not considered marriage.
2. Engagement of an impeached woman, even if impeachment is provisional, is prohibited
and the engagement of a widow during the period of widowhood may be attacked.
Article (18)
1. Any of the parties may renounce to his engagement and if a prejudice is sustained as a
result of an unjustified renouncement, the injured party may claim damages for the
prejudice sustained. The person causing renunciation shall be treated as the one who
renounces.
2. The party who renounces to the engagement or dies may recoup the dowry paid in kind
or, if it cannot be restituted as such, its equivalent at the date of payment.
3. Where the engaged woman purchases a trousseau for the total or part of the dowry then
the engaged man renounces to his engagement, she will have a choice either to restitute
the dowry or hand over its equivalent of the trousseau at the time of purchase.
4. Shall be considered among the dowry, gifts that are considered customarily as part
thereof.
5. In case any of the parties unjustifiably renounces to the engagement, and in the absence of
a condition or custom, he shall not be entitled to recover any of the gifts offered by him
and the other party may recoup what he has offered.
6. Where the renunciation is justified, the renouncing party may recover what he has
offered, if it still exists, or its amount at the date of payment, if it has perished or is
consummated, but the other party may recoup nothing.
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7. In case the engagement is terminated by mutual renunciation of the parties, each one of
them is entitled to recover what he offered, if still existing.
8. Where the engagement is terminated because of death or for a reason not attributed to any
of the parties, or because of an impediment to marriage, the gifts offered may not be
restituted.
Title Two. General Provisions of Marriage
Article (19)
Marriage is a contract that legitimates enjoyment between spouses; its aim is protection
and forming a steady family under the husband’s care on basis ensuring to the spouses the
assumption of its charges with affection and compassion.
Article (20)
1. Spouses are bound by the conditions exchanged except those legitimising the illicit or
banning the legitimate.
2. Where the contract of marriage contains a condition that is inconsistent with the
foundations of marriage, the contract is void.
3. Where the contract is subject to a condition that is not inconsistent with the foundations of
marriage but is in contradiction with its requirements or is considered illicit by law, the
condition is void but the contract valid.
4. If neither inconsistent with the foundations of marriage nor in contradiction with its
requirements and if not legally banned, the condition is valid and should be fulfilled. In
default thereof, the party benefiting of such condition may rescind the marriage, whether
he be the husband or the wife, and the former shall be exempted from alimony, payable
during the waiting period following the dissolution of marriage, if the defaulter is the
wife.
5. Should any of the spouses conditions in the other a specific attribute but the contrary was
revealed, the party requiring such attribute may ask for rescission of the marriage.
6. Disavowal negates the effect of any condition unless it is written in the registered contract
of marriage.
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7. The right to rescind a contract is foreclosed if forfeited by its owner or if he expressly or
impliedly accepts the contrary. Shall be considered an implied acceptance, the lapse of
one year following the occurrence of the violation with knowledge thereof and in case of
irrevocable divorce.
Article (21)
1. As a condition for the binding effect of a marriage, the man must be suitably qualified to
deserve the woman, but only at the formation of the contract. The woman and her tutor
are entitled to ask for the rescission of the contract on grounds of lack of such
qualification. The contract shall not be affected by the disappearance of such qualification
thereafter.
2. If the engaged persons are of inadequate age, i.e. the man’s age is double the age of the
woman, or more than that, the marriage shall take place only with the consent and
knowledge of the parties thereto after securing the authorisation of the judge who will
withhold it unless there is an interest in such marriage.
Article (22)
Fitness in religion is the measure of aptitude for the husband but, aside religion, custom
shall determine the other grounds of aptness.
Article (23)
1. Aptness is a right to both the woman and her fully capacitated tutor.
2. The remote, in rank, among tutors may not object for lack of aptitude except in case of
inexistence of the nearest tutor or his incapacity.
Article (24)
If the man alleges his aptness or uses deceitful devices to give this impression or if it was
made a condition in the contract and it was thereafter revealed that he was not apt, both
the wife and her tutor are entitled to ask for rescission.
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Article (25)
The right to ask for rescission is forfeited if the wife is pregnant, if a year has elapsed
since knowledge of the marriage or by previous consent of the one who has the right to
ask for rescission.
Article (26)
The tutor may not ask for rescission on grounds that the dowry is below that paid in equal
condition.
Article (27)
1. Marriage shall be officially recorded but, in consideration of a certain fact, it may be
established by other means of proof admitted by the Sharia.
2. Marriage is conditioned upon the submission of a medical report from a competent
medical Committee formed by the Minister of Health, certifying that the spouses are free
of any disease that the law considers a ground for separation.
3. The recording of the marriage shall be done by the authorised representatives of the
religious authority. The Minister of Justice, of Islamic Affairs and Wakfs shall issue a
regulation in their respect.
Article (28)
1. The tutor may not conclude the marriage of the insane, the imbecile or persons in their
status without the authorisation of the judge and the fulfilment of the following
conditions:
a) Acceptance of the other party to marry him after he has been informed of his
condition.
b) His disease is not transmitted to his progeny.
c) His marriage is in his interest.
2. The fulfilment of the two conditions (b) and (c) shall be verified by a report drawn up by
a competent Committee to be formed by the Minister of Justice, Islamic Affairs and
Wakfs in coordination with the Minister of Health.
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Article (29)
A male prodigal having attained the age of majority or one whose prodigality accrued
later may engage in marriage but the tutor may object to the portion of the dowry in
excess of the customary limit. Shall be excepted the foreclosure of financial rights
resulting from marriage.
Article (30)
1. Capacity to marriage is completed by reason and maturity. The age of maturity is 18
years, completed unless the person concerned matures earlier in conformity with the law.
2. Whoever matures before reaching the age of eighteen may not marry unless he obtains the
authorisation of the judge and after verifying the existence of an interest.
3. Should the person having completed the age of eighteen request marriage but did not
succeed in obtaining the approval of his tutor, he may raise the matter before the judge.
4. The judge shall fix a period for the tutor, after his notification, to appear before him to
hear his argument. Should he fail to appear, or his opposition to the marriage is not
convincing, the judge shall celebrate the marriage.
Article (31)
Whoever gets married, according to Article (30), shall acquire capacity in all what relates
to the marriage and its effects, with the exception of forfeiture of his pecuniary rights
resulting from marriage.
Article (32)
The tutor, in marriage, is the father then the agnates by themselves according to the
succession order: son, then brother, then uncle. Should two tutors be equal in degree of
kinship, the marriage that was concluded according to the conditions set forth by any of
them shall be valid. The one authorised by the engaged female shall be appointed.
Article (33)
The tutor must be a male of sound reasoning, fully capacitated, not prohibited on account
of pilgrimage and Muslim if tutorship is to be given to a Muslim.
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Article (34)
Should the most closely related tutor be interruptedly absent, his place of living unknown
or impossible to be contacted, tutorship shall pass to the one following him in rank with
the judge’s permission and, in case of prevention of marriage, tutorship shall pass to the
judge.
Article (35)
The judge is the tutor of whoever has no tutor.
Article (36)
The judge may not marry his ward for himself, his ascendant or descendant.
Article (37)
1. Proxy in marriage is possible.
2. The proxy may not marry for himself his principal unless it is so provided in the
procuration deed.
3. Should the proxy go beyond the limits of his authority, the contract is suspended.
Title Three. Elements and Conditions
Article (38)
The elements of a marriage contract are:
1) The two contracting parties (the husband and the Tutor).
2) The Object.
3) Offer and Acceptance.
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Chapter I. The Spouses
Article (39)
The tutor of the capacitated woman shall proceed with her marriage, with her consent and
the religious authorised official shall obtain her signature on the contract.
The contract is invalid in the absence of a tutor. If marriage has been consummated the
spouses shall be separated and the affiliation of the born child is established.
Article (40)
As a condition for the formation of marriage, the woman must not be permanently or
provisionally prohibited to the man.
Chapter II. Contract Text
Article (41)
Offer and acceptance are subject to the following:
1) The word “marriage” must be expressly used therein.
2) They must be of immediate fulfillment and not indicating a future time. Consequently,
the marriage shall not be concluded if made subject to an unrealised condition, or if the
contract is carried for a future date or the marriage is temporary.
3) The acceptance should meet, expressly or impliedly, the offer; the parties maintaining
their capacity until the formation of the contract.
4) Unity of the meeting of the parties: in their presence, the acceptance should verbally
occur immediately following the offer and, between absents, the acceptance should be
during the meeting in which the letter is read before witnesses or they be informed of its
contents or by informing the emissary. The acceptance shall not be late as to the offer if
they are not separated by what amounts to rejection.
5) Maintenance of the validity of the offer until the issuance of the acceptance. The offeror
has the right to withdraw his offer until the issuance of the acceptance.
6) Each of the contracting parties has to hear the words uttered by the other, being aware that
the objective is marriage although he did not understand the meaning of such words.
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In case of incapacity to express oneself, writing shall be the substitute and, if impossible,
then a significant sign would suffice.
Chapter III. Prohibitions
Section 1. Permanent Prohibitions
Article (42)
Due to kinship, a person is prohibited to marry:
1) his ascendant to the highest degree;
2) his descendant to the remotest degree;
3) descendants of the two parents or one of them, to the remotest degree;
4) the first category of the descendants of one of the grandparents.
Article (43)
Due to affinity, a person is prohibited to marry:
1) one who was the spouse of one of his ascendants, to the highest degree, or one of his
descendants, to the lowest degree;
2) ascendants of the husband, to the highest degree;
3) descendants of his wife in a consummated marriage, to the lowest degree.
Article (44)
A person shall be prohibited from marriage to his adulterous descendant, to the lowest
degree or his daughter proscribed for adultery.
Article (45)
A man shall be prohibited to marry the one he cursed as adulterous, after completion of
the curse.
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Article (46)
Shall be prohibited from fostering what is prohibited by kinship or affinity excluding
what is excepted by law; under the two following conditions:
1) Fostering should occur in the first two years.
2) Fostering should reach five different feedings.
Section 2. Temporary Prohibitions
Article (47)
Shall be temporarily prohibited:
1) Grouping, even during the waiting period, between two women, should one of them,
supposed by a male, he would have been prohibited to marry the other.
2) Grouping more than four women.
3) The wife of another person.
4) A woman in her waiting period from another man.
5) A repudiated woman whose repudiation is not retractable, the repudiator may not remarry
her repudiator unless after the expiry of her waiting period from another husband who
consummated a valid marriage.
6) A prohibited woman on account of pilgrimage.
7) A non-Muslim woman unless she is a believer in one of the Revealed religions.
8) The marriage of a Muslim woman from a non-Muslim.
Chapter IV. Conditions of the Contract
Article (48)
1. The validity of the marriage is subject to the presence of two witnesses, males, of full
capacity, sound minded, hearing the words pronounced by the contracting parties and
aware that the aim of such words is marriage.
2. The two witnesses must be Muslims but two witnesses from one of the Revealed religions
may witness the marriage of a Muslim with a woman of such Revealed religion.
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Chapter V. The Dowry
Article (49)
Dowry is what is offered by the husband, in money or property, for the purpose of
marriage. There is no minimum limit to it but the maximum is subject to the Law on
Dowries.
Article (50)
Notwithstanding anything to the contrary, dowry is the property of the bride, she can
freely dispose of it.
Article (51)
1. If the amount of dowry is validly determined in the contract, the amount spelt out is due
to the woman.
2. In case it is not determined in the contract, invalidly stated or originally denied, she is
entitled to an equal dowry payable to a bride under the same circumstances.
Article (52)
1. Dowry may, in whole or part, be advanced or deferred upon the formation of the contract.
2. Dowry is due by virtue of a valid contract. It becomes certain by a consummation of the
marriage, valid privacy or death. The deferred part of it shall become due by death or
repudiation.
3. The repudiated woman, before consummation of the marriage, is entitled to half the stated
dowry and, if not determined, the judge may adjudge to her a compensation not exceeding
half the dowry payable under similar circumstances.
Article (53)
1. The wife may refuse intercourse until the due part of the dowry is paid.
2. Should the wife accept intercourse before receiving her dowry from her husband, it
becomes a debt owed by him.
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Chapter VI. Mutual Rights
Article (54)
Mutual rights and obligations between the spouses are:
1) Legitimate mutual enjoyment of each other within what is allowed by law.
2) Lawful cohabitation.
3) Good treatment, mutual respect and compassion and preservation of the family welfare.
4) Care of the children and their education thus assuring upbringing on a sound basis.
Article (55)
Rights of the wife towards her husband:
1) Alimony.
2) Non-obstruction to complete her education.
3) Non-opposition to visit her ascendants, descendants and brothers.
4) Non-interference with her personal properties.
5) Non-infliction of bodily or moral prejudice to her.
6) Equitable treatment between her and the other wives, in case the husband has taken more
than one wife.
Article (56)
Rights of the husband towards his wife:
1) Willful obedience.
2) House supervision and preservation of its contents.
3) Suckling his children from her unless there is an impediment.
Title Four. Kinds of Marriages
Article (57)
Marriage is either valid or invalid and the latter includes the defective and the void
contracts.
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Article (58)
1. A valid marriage is one in which all basic elements are present, its conditions fulfilled and
free of impediments.
2. A valid marriage shall produce its effects upon its formation.
Article (59)
1. A defective marriage is one where some of its conditions are missing.
2. A defective marriage does not produce any effect prior to coitus.
Article (60)
A defective marriage shall, after coitus, produce the following effects:
1) The specified dowry or a reciprocal dowry under same circumstances, whichever is
smaller.
2) Establishment of kinship.
3) The prohibition because of affinity.
4) Waiting period because of dissolution of marriage.
5) Alimony as long as the wife ignores the defectiveness of the contract.
Article (61)
1. A void marriage is the one where one of its basic elements is defective.
2. Unless otherwise provided by this Law, a void marriage shall not produce any effect.
Title Five. Effects of Marriage
General Provisions
Article (62)
1. A woman having reached the age of full capacity is free to dispose of her property and the
husband may not, without her consent, dispose thereof; each one of them has independent
financial assets. If one of the two participates with the other in the development of a
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property, building a dwelling place or the like, he may claim from the latter his share
therein upon divorce or death.
2. In donations or similar dispositions, between the children or the wives equality must exist
unless the judge deems that there is an interest thereto. Should there be no equality, the
judge shall bring it into effect and shall exclude it from the succession.
Chapter I. Alimony
Article (63)
1. Alimony includes food, clothing, dwelling, medical care, servicing charges for the wife, if
she is performing such services within her family, and all what the conjugal relationship
kindly requires.
2. In assessing the amount of alimony, it shall be taken into consideration the possibilities of
the debtor thereof, the circumstances of the beneficiary and the economic situation, in
place and time, provided it does not fall below the sufficiency level.
3. In adjudging alimonies of all kinds, fostering and dwelling charges and all conditions on
which depends adjudging all these, eye-witnessing shall suffice.
Article (64)
1. Alimony may be increased or reduced according to the change of circumstances.
2. Save in exceptional circumstances the action in increment or reduction of the alimony
may not be heard prior to the lapse of one year as of the date of deciding it.
3. The increase or decrease of alimony is computed from the date of claim in court.
Article (65)
The continuous alimony has privilege over all debts.
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Section 1. Alimony of the Wife
Article (66)
Alimony is due to the wife by virtue of a valid contract if she abandons herself to her
husband even inevitably.
Article (67)
Alimony to the wife is due as of the date of refrainment from payment when due as a debt
on the husband, independently of a court judgment or agreement. It is not forfeited except
by payment or discharge.
A claim for alimony, for a past period exceeding three years from the date of introducing
action in court, shall not be heard unless it is imposed by agreement.
Article (68)
The judge shall, upon request of the wife, order to pay her a temporary alimony and his
decision shall be executory summarily and by force of law.
Article (69)
Alimony and sheltering, during the waiting period (“idda”), are due to the divorcee in a
reversible divorce, in a non-retractable divorce if the divorced woman is pregnant and, if
she is not, only sheltering is due.
Article (70)
No alimony is due to the widow during her waiting period because of the death of her
husband but she is entitled to live in the conjugal domicile during the said period.
Article (71)
Alimony to the wife is forfeited in the following instances:
1) Should she refuse to give herself to her husband or refuse to reintegrate the conjugal
domicile without lawful excuse.
2) Should she abandon the conjugal domicile without lawful excuse.
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3) If she forbids her husband to enter the conjugal domicile without a lawful excuse.
4) If she refuses to travel with her husband without a lawful excuse.
5) If a judgment or decision is rendered by the court, restraining her freedom, in a matter to
which the husband is not entitled, and the said judgment or decision is in the process of
execution.
Article (72)
1. A wife may go out of her home in the instances that allow her to do so by law, custom or
in case of necessity and this is not considered a transgression to the duty of obedience.
2. Shall not be considered a transgression to the duty of obedience her going out to work if
he married her while engaged in work, if he accepted, after marriage, that she be
employed or if she put it as a condition in the contract and, in this latter case the
authorised marriage official has to ascertain the existence of such condition upon
contracting. This of course unless the fulfilment of such condition is against the interest of
the family.
Article (73)
The obligation of alimony to the wife is terminated upon the occurrence of any of the
following events:
1) Payment.
2) Discharge.
3) The death of one of the spouses unless it has been ordered by court decision.
Article (74)
The husband is under obligation to prepare to his wife, at his domicile, a convenient
dwelling commensurate with their standing.
Article (75)
The wife shall live with her husband in the dwelling prepared for the purpose and shall
move with him from it unless she provided otherwise in the contract or if the purpose of
moving is to cause her a prejudice.
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Article (76)
1. The husband may accommodate, with his wife, in the conjugal domicile, his parents and
children from another woman as long as he is financially in charge of them but provided
no prejudice is caused to the wife from such accommodation.
2. The wife may not accommodate with her in the conjugal domicile her children from
another man unless they have no other caretaker, they may be harmed from separation or
by express or implied agreement of the husband, provided he has the right to go back on
his acceptance should he sustain a prejudice therefrom.
Article (77)
The husband may not accommodate with his wife another wife of his unless she accepts
provided she can go back on this acceptance whenever it becomes detrimental to her.
Section 2. Kinship Alimony
Article (78)
1. Alimony of the small child who has no financial resources is on his father until the
marriage of the girl or until the boy reaches the age at which his fellow-mates earn their
living, unless he is a student continuing his studies with normal success.
2. Alimony of the elder child unable to earn his living, because of a disability or other cause,
is on his father should the child have no other funds from which his expenses could be
drawn from.
3. Alimony of the female is on her father if she divorced or has become a widow, unless she
has funds of her own or has a person in charge of her other than the father.
4. Should the child have no sufficient funds to meet his maintenance expenses, the father is
under obligation to complete the required amount within the aforementioned conditions.
Article (79)
The suckling expenses of the child are on his father, should the mother be unable to
nurture him, and this is considered as alimony.
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Article (80)
The child’s alimony is on his well-to-do mother if he lost his father, without funds, or if
he was unable to support him. The mother may revert on the father for the amount spent
in case he improves his financial capacity and the expenditures were authorised by him or
by the judge.
Article (81)
1. A well-to-do child, male or female, grown-up or small, must provide alimony to his
parents if they have no funds from which they can spend.
2. Should the parents’ funds be insufficient for their maintenance, the children are under
obligation to cover the shortage.
Article (82)
1. The parents’ alimony shall be repartitioned between their children, each in proportion to
his ability.
2. Should a child voluntarily spend money on his parents, he may not revert on his brothers.
3. Should the spending take place subsequent to a judgment ordering them to pay alimony,
he may revert on each one of his brothers according to what was adjudged, provided he
made these expenses with an intention to claim back the excess paid by him.
Article (83)
If the child’s earnings are not in excess of his needs and the needs of his wife and
children, he shall be under obligation to add his parents, deserving alimony, to his family.
Article (84)
Alimony to each deserving payee shall be the obligation of his heirs from among his wellto-do
relatives according to their rank and their shares in the estate and if the heir is
insolvent the obligation shall pass to the succeeding heir with due compliance to Articles
(80) and (81) of this Law.
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Article (85)
Should the persons deserving alimony be several and the payee is unable to satisfy them
all, the wife’s alimony shall have precedence, then the children’s alimony, followed by
that of the parents, then the alimony of the relatives.
Article (86)
1. The alimony of relatives, other than the children shall be due as of the date of the claim in
court.
2. The lawsuit claiming a past due alimony for the children from their father shall not be
heard if it goes back to a period in excess of one year from the date of submitting the
claim to court.
Section 3. Alimony to Those Who Have No One to Support Them
Article (87)
The State shall be in charge of the alimony to those having no one to support them.
Article (88)
Alimony of the foundling of unknown parents shall be paid out of his funds, if any, and in
case he has no funds and no one benevolently proposed to spend on him, his alimony
shall be on the State.
Chapter II. Affiliation
Article (89)
Affiliation shall be established by wedlock, by avowal, presumptions or through scientific
methods if bed-sharing is established.
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Article (90)
1. The child is born in wedlock if the shortest period of pregnancy has lapsed since the valid
marriage and it is not established that carnal knowledge was impossible between the
spouses.
2. The affiliation of the child shall be established from suspected copulation if he is born for
less than the shortest period of pregnancy after the said carnal knowledge.
3. Affiliation of the born child shall be established to his mother upon evidence of his birth.
4. Once the affiliation is legally established, the action in disavowal shall not be heard.
Article (91)
The shortest period of pregnancy is one hundred and eighty days and the longest period is
three hundred and sixty five days, unless a committee of medical physicians formed for
the purpose decides otherwise.
Article (92)
1. Acknowledgement of affiliation, even in death-bed, is evidence of consanguinity, unless
the acknowledged person is out of wedlock, under the following conditions:
a) The acknowledged person is of unknown descent.
b) The acknowledging party is of full capacity, of sound judgment and of free choice.
c) The difference of age between the acknowledging party and the acknowledged may
sustain the veracity of the acknowledgement.
d) The acknowledged person, of full capacity and sound judgment, approves the
acknowledging party.
2. Affiliation is an acknowledgement of consanguinity in lineal descent made by the father
of an acknowledged non-adulterous person. Acknowledgement of affiliation by the
grandparent is not valid.
Article (93)
Should the acknowledging party be a married woman or a woman in her waiting period,
the affiliation of the child to her husband is not established unless he consents or there is
corroborating evidence to this effect.
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Article (94)
The acknowledgement by the person of unknown descent of his father or mother shall
establish consanguinity if approved by the acknowledged or there is evidence to this
effect whenever the age difference allows such possibility.
Article (95)
Acknowledgement of kinship, other than consanguinity in lineal descent, paternity or
maternity does not bind other than the acknowledging party unless approved or
established by evidence.
Article (96)
1. Curse may only be uttered before the court in accordance with the rules as set forth by
law.
2. Divorce by curse is permanent.
Article (97)
1. The man may disavow affiliation of the child by throwing a curse within seven days from
his knowledge of birth provided he did not acknowledge expressly or impliedly his
paternity. Action for malediction shall be submitted to the court within thirty days as of
knowledge of birth.
2. Where curse is for the disavowal of affiliation, the latter shall be negated.
3. Should the husband take the oath of malediction and the wife refused to take it, refused to
appear before the court or has been absent and it was impossible to give her notice, the
judge shall adjudge the negation of affiliation.
4. The affiliation of the disavowed child because of malediction shall, after issuance of the
decision negating his affiliation, shall be reinstated if the man retracted his curse.
5. The court may resort to scientific methods to negate affiliation provided it has not been
previously established.
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BOOK TWO. DISSOLUTION OF MARRIAGE
General Provisions
Article (98)
1. The contract of marriage shall be rescinded if it includes an impediment that is in
contradiction with its requirements or the occurrence of something that prevented its legal
continuation.
2. Disunion between the spouses occurs by divorce, rescission or death.
3. Prior to deciding disunion between spouses, the court has to endeavour reconciliation.
4. Should the divorced woman marry another man with whom she has carnal knowledge, the
number of divorces pronounced by her previous husband shall be considered as nonexistent.
Title One. Divorce by Repudiation
Article (99)
1. Repudiation is the dissolution of the valid contract of marriage in the form legally
prescribed.
2. Repudiation takes place verbally or in writing and, in case of inability, by an
understandable sign.
Article (100)
Repudiation takes place by the husband or his proxy, designated in a special power of
Attorney or the wife if her husband gave her complete autonomy of herself.
Article (101)
1. The repudiator must be of sound mind and have free choice.
2. Repudiation done by a man of unsound mind due to a banned substance shall be
considered a choice.
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Article (102)
Repudiation of the wife may occur only if she is party to a valid marriage and she is not
within the waiting period (known as Idda).
Article (103)
1. Divorce subject to a condition precedent to do or depart from something shall not be
effective unless there is an intention to divorce.
2. In the absence of an intention to divorce, there is no divorce in case of perjury to an oath.
3. A divorce made verbally, in writing or by sign, whether repeated or in conjunction with a
number, shall be construed to be once only.
4. A divorce may not be contingent on the happening of a future event.
Article (104)
Repudiation is either retractable or non-retractable:
1) The retractable repudiation does not put an end to marriage unless after the expiry of the
waiting period (Idda).
2) The non-retractable repudiation ends the marriage upon its occurrence. It may take one of
the following two forms:
a) Repudiation with right to remarry: The divorcee may not return to the man who
divorced her except after a new contract of marriage and a new dowry;
b) Final and decisive repudiation: The divorcee may not return to the man who
divorced her except after expiry of the waiting period (Idda) from another husband
who had carnal knowledge of her pursuant to a valid marriage.
Article (105)
Every repudiation is retractable except the repudiation completing the third, the one
occurring prior to sexual penetration and the one considered by law final and decisive.
Article (106)
1. Divorce occurs through a declaration made by the husband and recorded by the judge.
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2. Each divorce occurring contrary to the preceding clause must be confirmed before the
court by evidence or avowal. The divorce shall take effect as of the date of the
acknowledgement unless a prior date is established to the court. The Sharia rules shall
apply to the effects of divorce by avowal.
Article (107)
Upon request of the concerned persons and after divorce, the competent judge issues an
order fixing the woman’s alimony during her waiting period as well as the alimony of the
children, determine the person who has the right to foster the child and the right to visit
the fostered child. This order is considered as being of summary execution by force of law
and the prejudiced party may appeal this order by all means of appeal prescribed by law.
Article (108)
The husband is entitled to get back his divorcee, should the divorce be revocable and as
long as she is within her waiting period. His right thereto is not forfeited even if
surrendered. Should the divorcee’s waiting period expire, she may return to him by a new
contract without the permission of her tutor, if he refuses to give her in marriage to him,
provided that her first marriage from him has been concluded with the tutor’s consent or
by order of the court.
Article (109)
1. Getting back a divorcee occurs verbally, in writing and, where impossible, by sign as well
as by action with intent.
2. Retrieval shall be recorded and the wife should be informed of it during her waiting
period.
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Title Two. Divorce by Agreement (Khul’)
Article (110)
1. Divorce for consideration is a contract between the spouses whereby they agree to
terminate the contract of marriage against consideration to be paid by the wife or by
another person.
2. The amount to be paid as a consideration shall be governed by the same rules as dowry
but it is not allowed to agree on forfeiture of the children’s alimony or their fostering.
3. Should the consideration to be paid in case of divorce by agreement be not validly
determined, divorce shall occur and the husband shall be entitled to the dowry.
4. Khul’ is a rescission.
5. By exception to the provisions of clause 1 of this Article, where the husband is unduly
obstinate in his rejection and it was feared not to observe God’s will, the judge shall
decide the “Mukhala’a” (divorce) against an adequate consideration.
Article (111)
Validity of the consideration for such divorce is conditioned upon capacity of the payor
and capacity of the husband to divorce.
Title Three. Judicial Separation
Chapter I. Separation on Account of Defects
Article (112)
1. Should one of the spouses find in the other a deep-rooted repulsive or harmful defect such
as insanity and leprosy, or those preventing sexual pleasure such as obstruction of genital
canals or similar defects, he may ask for the rescission of the marriage whether this flaw
existed prior to the contract or occurred later.
2. His right to rescission shall be forfeited if he had knowledge of the defect before the
contract or accepted it expressly or impliedly thereafter.
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3. However, the wife’s right to claim rescission on grounds of defects preventing sexual
pleasure shall not, under any circumstance, be forfeited.
4. The court shall examine, in chambers, the case of rescission of marriage on grounds of
sexual defects.
Article (113)
Should the defects mentioned in Article (112) of this Law be not susceptible to disappear,
the court shall rescind the marriage immediately and without delay.
Where it is likely to disappear, the court shall adjourn the case for an adequate period, not
exceeding one year, and in case it does not disappear during this period and the party
claiming rescission insists, the court shall rescind the marriage.
Article (114)
Each of the two spouses is entitled to ask for separation in the following instances:
1) In case of deceit perpetrated by the other spouse or with his knowledge inducing to the
formation of the marriage contract. Intentional silence about a fact is deceit if it is
established that the deceived party would not have concluded the marriage contract had
he been aware of such fact.
2) If it is established by a medical report the sterility of the other spouse, after a marriage
that lasted five years and after medical treatment, provided that the claimant has no
children and that he is not in excess of forty years of age.
3) If the other party is condemned for adultery or a similar offence.
4) Where it is established that the other spouse contracted a contagious fatal disease such as
Aids or similar, so if it is feared that this disease be contracted by the other spouse or their
descendants, the judge must order their separation.
Article (115)
1. The assistance of a medical committee specialised in detecting the defects for which
separation is claimed shall be sought.
2. Separation, in this chapter, is a rescission.
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Chapter II. Separation Due to Non-Payment of the Due Dowry
Article (116)
1. The wife in a non-consummated marriage shall be adjudged separation due to nonpayment
by her husband of the due dowry, in the following instances:
a) If the husband has no apparent funds from which the dowry could be drawn;
b) If the husband is manifestly insolvent or of unknown status and the period fixed by
the judge for payment of her dowry has expired without payment.
2. The wife shall not, after consummation of the marriage, be adjudged separation for nonpayment
of her due dowry which shall remain a debt on her husband.
Chapter Three. Separation Due to Prejudice and Discordance
Article (117)
1. Each of the two spouses is entitled to ask for divorce due to prejudice that would make
the continuity of the friendly companionship between them impossible. The right of each
of the spouses thereto shall not be forfeited unless their reconciliation is established.
2. In accordance with Article (16) of this Law, the Family Orientation Committee shall
endeavour the reconciliation of the two spouses and, in case of failure, the judge shall
propose reconciliation to the spouses. If this reconciliation is not possible and the
prejudice is established, the judge shall order divorce.
Article (118)
1. In case the prejudice is not established, the discordance is still continuing between the
spouses and the Family Orientation Committee as well as the judge were not successful in
reconciling them, the judge shall issue a judgment appointing two arbitrators from among
their parents, if possible, after asking each of the spouses to nominate, in the next hearing
at most, his arbitrator from among his parents, if possible, otherwise from those who have
the experience and ability to reconcile. Should one of the spouses procrastinate in
nominating his arbitrator or abstain from attending this hearing, the judgment shall not be
subject to any appeal.
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2. The judgment appointing the two arbitrators must include the starting and closing dates of
their assignment provided it does not exceed ninety days extendable by a decision of the
court. The court shall notify the two arbitrators and the parties to the litigation of the
judgment appointing the arbitrators and shall ask each of them to take the oath that he will
perform his assignment with equity and probity.
Article (119)
The two arbitrators have to find out the reasons of discordance and deploy efforts to
reconcile between the spouses. Abstention from any of the spouses to attend the
arbitration sitting, whenever notified of the date fixed for it, or the next sittings if set at
different intervals, shall not affect the progress of the arbitrators work.
Article (120)
In case the arbitrators fail to reconcile the spouses:
1) Should the offence be entirely from the husband’s part and the wife, or both parties are
claiming separation, the arbitrators shall decide a non-retractable divorce without
prejudice to the rights of the wife resulting from marriage and divorce.
2) In case the offence is entirely from the wife’s part, the arbitrators shall decide divorce for
a consideration deemed adequate by them and payable by the wife.
3) Where both parties participated in the offence, the arbitrators shall decide separation
without consideration or with one in proportion to each one’s share in the offence.
4) If the case is not clear as to who is the offender among them and if the husband is the
claimant, the arbitrators shall recommend dismissal of his case; but if the wife or both of
them are claiming separation, the arbitrators shall decide separation between them without
consideration.
Article (121)
1. The arbitrators shall submit to the judge their reasoned decision that shall include the
extent to which each of the spouses offended the other.
2. The judge shall render his judgment in accordance with the decision reached by the
arbitrators if they agreed, otherwise, he shall appoint others or join to them a third as
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the umpire. The court shall ask the arbitrator or the umpire to take an oath that he will
perform his duties with equity and probity.
Article (122)
In the case of divorce due to prejudice, the prejudice shall be established by the legal
means of proof and by the court judgments rendered against one of the spouses.
The hearsay testimony is accepted if the witness explained, or it was understood from his
statement that the prejudice is widespread in the spouses’ life environment as decided by
the court.
A hearsay testimony to negate the prejudice is not accepted.
The testimony of a male or female witness, except the testimony of an ascendant against a
descendant or vice-versa, shall be accepted if the witness fulfils the conditions set forth by
law for testimonial evidence.
Article (123)
Where the wife asks for divorce, before consummation of marriage or legal privacy, and
she deposited the amount received as dowry, the gifts obtained and the amount spent by
the husband because of marriage, but the husband abstained from doing so and in case the
judge did not succeed in reconciling them, he shall order separation against consideration
(Khul’).
Chapter IV. Separation for Abstention from Support
Article (124)
1. If the present husband abstains from supporting his wife and he does not have apparent
funds from which he can pay, within a short time, the due alimony, the wife may ask
separation.
2. Should he allege to be insolvent but with no evidence as to his allegation, the judge shall
order immediate divorce. If he keeps silent as to his being solvent or insolvent and insists
on non-support, even if there is evidence of his insolvency, the judge shall grant him a
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respite of not more than a month after which, if he does not comply with his duty of
support, the judge shall order divorce.
Article (125)
1. In case the husband is absent in a known place:
If he has apparent funds, the alimony judgment shall be enforced on these funds.
Where he has no apparent funds, the judge shall warn him and grant him a respite not in
excess of one month to which shall be added the prescribed period of distance and, in case
he does not execute his duty of support or does not bring the alimony, the judge shall
order divorce after expiry of the respite.
2. If he is absent in an unknown place, in a place difficult to reach or missing and there is
also evidence that he has no funds from which alimony could be withdrawn, the judge
shall order divorce.
Article (126)
The husband may avoid divorce by submitting evidence of his solvency and his ability to
pay the alimony. In this case, the judge shall grant him the respite prescribed in Article
(125) of this Law.
Article (127)
The husband may retrieve his wife, while she still is in her waiting period, if there is
evidence of his solvency and he shows his readiness to support his wife by paying the
usual alimony, otherwise the retrieval is not valid.
Article (128)
If the lawsuit for non-support is brought to court more than twice and it is established to
the court the non-support in each and the wife asks divorce for non-support, the judge
shall order a non-retractable divorce.
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Chapter V. Separation Due to Absence and Disappearance
Article (129)
The wife is entitled to claim a judicial divorce due to the absence of her husband who has
a known domicile or residence even though he has funds from which alimony can be
drawn. She will get a judgment in satisfaction of her claim only after warning him: either
to reside with her or have her move to live with him or divorce her and provided he is
given a delay of not more than one year.
Article (130)
The wife of the disappeared, whose residence is unknown, is entitled to ask for a judicial
divorce and she will be granted relief only after investigation and search for him and the
lapse of one year as of the date of filing the claim.
Chapter VI. Separation for Imprisonment
Article (131)
1. The wife of the incarcerated, who is condemned by a decisive judgment to a penalty
restraining his liberty for a period of three years or above, is entitled to ask the court, after
the lapse of one year of his imprisonment, to divorce him irreversibly even though he has
funds from which she can spend.
2. Where the wife is also incarcerated but has been freed alone, she may ask for separation,
after the lapse of one year of her release, under the same conditions mentioned in Clause
1 of this Article.
3. In both the preceding instances, judgment for the wife is conditioned upon the non-release
of the husband during the examination of the case and that the remaining period of his
incarceration be not less than six months.
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Chapter VII. Separation for “Ila’ ” and “Zihar”
Article (132)
The wife is entitled to ask for divorce if her husband swore not to have sexual relations
with her for four months or more, unless he has such relations before the expiry of the
four months. Divorce, in this case, is non-retractable.
Article (133)
The wife is entitled to divorce on grounds of “Zihar”.
Article (134)
The judge shall warn the husband to expiate from “Zihar” within four months from taking
the oath. Should he refuse without giving a reason, the judge shall order a non-retractable
divorce.
Article (135)
In examining the divorce case, the judge shall decide which provisional measures he
deems appropriate to take in order to secure alimony for the wife and the children and all
that relates to the fostering and visiting of children upon request of any of the spouses.
Title Four. Effects of Separation
Chapter I. The Waiting Period (Al Idda)
Article (136)
“Idda” is an obligatory waiting period during which the wife remains without marriage, as
a result of separation.
Article (137)
1. The waiting period starts as of the occurrence of separation.
2. The waiting period, in case of doubtful copulation, starts as of the last sexual intercourse.
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3. Waiting period in marriage shall begin from the date of separation, divorce or death of the
husband.
4. In case of ruling divorce, separation, rescission, nullity of the contract or judicial
declaration of death of the disappeared, the waiting period starts as of the time the
judgment becomes final.
Article (138)
1. The duration of the waiting period, for the woman whose husband from a valid marriage
died, even before consummation of the marriage, is four months and ten days unless she
is pregnant.
2. The waiting period for a pregnant woman ends upon delivery or miscarriage.
3. In a consummated marriage resulting from a void or suspected contract, if the husband
dies, the woman shall have to undergo the waiting period of the divorcee to clear her
uterus.
Article (139)
1. There is no waiting period prior to consummation of marriage and valid privacy.
2. The waiting period for the non-pregnant divorcee:
a) Three purities for those who have their menstruation and she is to be believed at the
expiry of this period within a reasonable time.
b) Three months for those who did not have at all their menstruation or those who have
reached the menopause and their menstruation stopped. Should the latter see
menstruation prior to the expiry of the period, the waiting period shall be resumed
for three purities.
c) Three months for extended blood secretion if the woman has no known menstrual
cycles but if she recalls having such cycle it shall follow it in computing the waiting
period.
d) The shorter period between three purities and one year without menstruation for
those whose menstruation stopped before reaching the age of menopause.
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Article (140)
In case the husband divorces his wife from a valid consummated marriage by his
unilateral will without a request from her, she is entitled to a compensation other than the
alimony paid during the waiting period depending on the financial status of the husband
provided it does not exceed a one-year alimony payable to those in similar condition. The
judge may order that it be paid by instalments depending on the degree of solvency or
insolvency of the husband. In assessing the amount thereof, the prejudice sustained by the
wife shall be taken into consideration.
Article (141)
1. Should the husband die and the wife is in her retractable divorce waiting period, she
passes to the widowhood waiting period and the lapsed period shall not be taken into
account.
2. Should the husband die while the woman is in her waiting period for repudiation or
rescission, she shall complete it and is not bound by the death waiting period unless
repudiation took place during the last illness, then the longest of the two periods shall be
taken into account.
Chapter II. Fostering
Article (142)
Fostering is to safekeeping the child, educate and ward him in a manner that does not
contradict the tutor’s right of tutelage over the person of the child.
Article (143)
The fosterer must satisfy the following conditions:
1) sound judgment;
2) having attained the age of maturity;
3) fidelity;
4) ability to raise the fostered child and provide for his maintenance and care;
5) safety from dangerous contagious diseases; and
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6) not previously condemned for a crime against honour.
Article (144)
In addition to the conditions mentioned in the above Article, the fosterer must:
1) If a woman:
a) Be not married, in a consummated marriage, to a man not related to the fostered
child, unless the court decides otherwise in the interest of the child.
b) Be of the same religion as the fostered child, with due compliance with Article (145)
of this Law.
2) If a man:
a) He must have around him a woman able to be a fosterer.
b) Be related to the fostered girl with such close kinship prohibiting him to marry her.
c) Be of the same religion as the fostered child.
Article (145)
Should the fosterer be a mother of a different religion than that of the fostered child, her
fosterage shall be forfeited unless the judge deems otherwise in the interest of the fostered
child provided the period of fosterage ends upon his completing the age of five whether
the child is a boy or a girl.
Article (146)
1. Fosterage of the child is a right to the mother, then to the females, within the prohibited
degrees of kinship, giving preference to those from the mother’s side over these from the
father’s side taking into consideration the closest degree from both sides, with the
exception of the father, and the judge shall in his decision consider the interest of the
fostered child. In deciding who is the fosterer, the following order shall be observed:
a) The mother.
b) The father.
c) The grandmother, from the mother’s side, and upwards.
d) The grandmother, from the father’s side and upwards.
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e) The sisters, giving preference to the full sister, then to the stepsister from the
mother’s side, then the stepsister from the father’s side.
f) The daughter of the full sister.
g) The daughter of the stepsister from the mother’s side.
h) The aunts from the mother’s side, in the same order as the sisters.
i) The daughter of the stepsister from the father’s side.
j) The daughters of the brother in the same order as the sisters.
k) The aunts from the father’s side, in the above order.
l) The mother’s aunts from the maternal side, in the above order.
m) The father’s aunts from the maternal side, in the above order.
n) The mother’s aunts from the paternal side, in the above order.
o) The father’s aunts from the paternal side, in the above order.
2. Where no fosterer is found among the above women, or if none is qualified, fosterage
shall pass to the male agnates, in the same order followed in inheritance, giving
preference to the paternal grandfather and his ascendants (provided the sequence is not
interrupted by a female ascendant) over the brothers.
3. If none of the above exist, the right to fosterage passes to the males, within the prohibited
degrees of kinship with the child other than the agnates, in the following order: the
maternal grandfather, the stepbrother from the mother’s side, the son of the maternal
stepbrother, the unilinear uncle from the father’s side, then the maternal uncles by giving
preference to the consanguineous, then the unilinear uncle (his mother’s stepbrother) from
his father’s side, then the unilinear uncle (his mother’s stepbrother) from his mother’s
side.
4. Should fosterage be refused by those entitled, male or female, the right passes to the next
entitled who shall be notified thereof by the judge and if he refuses or keeps silent for
fifteen days, the right passes to the next in rank.
5. Under all circumstances, is not entitled to fosterage, in case of difference in sex, whoever
is not within the prohibited degree of kinship with the child, whether male or female.
6. Unless the judge deems in the interest of the fostered child, the mother, in case of
litigation, is entitled to fosterage.
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7. In case of difference between the spouses and where the mother leaves the conjugal
domicile, even if the bond of marriage has not been dissolved, the mother or the father
may apply to have the children join him/her and the judge shall decide in accordance with
the children’s best interest.
Article (147)
In the absence of the two parents and in case the fosterage is not accepted by those
entitled to it, the judge shall choose the adequate person from among the relatives of the
fostered child or others or one of the institutions qualified for this purpose.
Article (148)
1. The father or else another tutor of the fostered child must look after his affairs, discipline,
orientation and education.
2. Whoever is in charge of the fostered child’s alimony must provide the rent of a dwelling
for a woman fosterer unless the latter owns a dwelling in which she resides or affected for
this purpose.
3. The female fosterer is not entitled to remuneration if she is the wife of the fostered child’s
father or is in her waiting period during which she is entitled to alimony from him.
Article (149)
The fosterer may not travel with the fostered child outside the State except with the
written approval of his tutor. Should the tutor refuse to give his consent, the matter shall
be submitted to the judge.
Article (150)
1. The mother, during her wedlock or during her waiting period after a retractable
repudiation, may not travel with her child or move him from the conjugal domicile
without the written approval of his father.
2. The mother may, after the waiting period, take the child to another city within the State in
case this move does not affect his education, is not prejudicial to the father and does not
cost him unusual effort and expense to be informed about the fostered child’s condition.
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Article (151)
1. Should the fosterer be other than the mother, she may not travel with the child without a
written authorisation from his tutor.
2. The tutor, whoever he is, or another person, may not travel with the child during fosterage
without a written authorisation of the fosterer.
3. The fosterage of the repudiated mother may not be forfeited just because the father moved
to a city other than that in which the fosterer resides, unless the move is for the purpose of
settling, is not prejudicial to the mother and the distance between the two cities does not
allow the mother to see the fostered child and return the same day by the usual
transportation means.
Article (152)
The fosterer’s right to fosterage is forfeited in the following instances:
1) Derogation to one of the conditions stated in Articles (143) and (144).
2) In case the fosterer elects a domicile in another city thus making it difficult for the tutor to
attend to his duties.
3) Should the person entitled to fosterage keep silent and do not claim this right for a period
of six months without excuse.
4) Should the new fosterer live with the one whose fosterage has been forfeited for a reason
other than physical disability.
Article (153)
Fosterage shall be reinstated to the one from whom it was forfeited whenever the cause of
it has disappeared.
Article (154)
1. Where the fostered child is under the fosterage of one of his parents, the other is entitled
to visit and be visited by the child and accompany him wherever decided by the judge
provided he fixes the place and time and the person in charge to bring the fostered child.
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2. Should one of the parents of the fostered child pass away or be absent, the fostered child’s
relatives, to a degree prohibiting marriage, may visit him as decided by the judge.
3. If the fostered child is with other than his parents, the judge shall designate the person
entitled to visit him from among his close relatives.
4. The judgment shall be enforced coercively should the person with whom the fostered
child lives refuse to execute it.
5. The Minister of Justice, Islamic affairs and Wakfs shall issue a regulation determining the
procedures to see, deliver and visit the fostered child provided these do not take place in
police stations or prisons.
Article (155)
In case the persons entitled to fostering are more than one and they are all of the same
degree, the judge shall choose the one that is best for the child.
Article (156)
1. The right of women to fosterage of a child shall end upon his reaching the age of eleven
years, if a male, and thirteen years, if a female, unless the court deems that extending this
age to the age of maturity, for the male, and up to her marriage, for the female, is in
his/her best interest.
2. Unless the interest of the fostered child otherwise require, the women fosterage shall
continue in case the child is of unsound mind or suffering of a disabling illness.
Article (157)
1. Without prejudice to the provisions of Article (149) of this Law, the tutor may keep with
him the passport of the fostered child, except in case of travel, where he should hand it
over to the woman fosterer.
2. The judge may order to maintain the passport in the hands of the fosterer should he notice
an obstinateness from the tutor’s part to refuse delivering it to the fosterer in case of
necessity.
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3. The woman fosterer may keep the originals, or true official copies of the birth certificate
and any other evidential documents, pertaining to the fostered child, as well as his identity
card.
Article (158)
Court decisions concerning the affiliation and protection of the child and delivering him
to a custodian as well as the separation between spouses and like matters pertaining to
personal status shall be enforced coercively even through the use of force and forced entry
of homes. The official in charge of execution shall, in this respect, follow the instructions
given to him by the judge of execution in the court of the place of execution. The
judgment, whenever required, shall be re-executed.
The judgment rendered against the wife to follow her husband may not be executed
coercively.
BOOK THREE. CAPACITY AND TUTORSHIP
Title One. Capacity
Chapter I. General Provisions
Article (159)
Every person has capacity to contract unless this capacity is withdrawn or limited by a
law provision.
Article (160)
Is considered as a minor:
1) The fetus.
2) The insane, the imbecile and the prodigal.
3) The missing person and the absentee.
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Article (161)
Is considered devoid of capacity:
1) The undiscerning minor.
2) The insane and the imbecile.
Article (162)
Is considered lacking capacity:
1) The discerning minor.
2) The prodigal.
Article (163)
Minor’s affairs shall be attended to by his representative called, as the case may be, Tutor,
Guardian (which includes the named guardian and the one appointed by the judge) or
curator on the minor’s property.
Chapter II. Provisions Relating to the Minor
Article (164)
A minor is discerning or undiscerning.
The undiscerning minor, according to this Law provisions, is the one who did not
complete seven years of age.
The discerning minor is the one who has completed seven years of age.
Article (165)
Without prejudice to the provisions of Articles (30) and (31) of this Law:
1) The verbal acts of disposition of an undiscerning minor are absolutely null and void.
2) The verbal financial acts of disposition of a discerning minor are valid if purely beneficial
to him; void if absolutely detrimental.
3) The verbal financial acts of disposition of a discerning minor that are vacillating between
being beneficial or detrimental depend on authorisation.
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Article (166)
1. The tutor shall authorise the minor who has completed eighteen years of age to take
possession of the whole or part of his property to manage it.
2. The court may, after hearing the guardian, authorise the minor who has completed
eighteen years of age to take possession of the whole or part of his property to manage it.
Article (167)
The authorised minor, whose acts are included in the authorisation, is considered as one
who has the attained the legal age of maturity.
Article (168)
In case the discerning minor completes eighteen years of age and finds himself capable of
sound judgment but the guardian refused to authorise him to take over the management of
part of his property, he may submit the matter to the judge.
Article (169)
The minor authorised by his guardian shall have to submit to the judge periodical
accounts of his acts.
Article (170)
Should the interest of the minor so require, the judge and the guardian may cancel or limit
the authorisation.
Chapter III. Majority
Article (171)
Every person attaining the age of majority, enjoying his mental abilities and not
interdicted has full capacity to exercise his rights provided for in this Law.
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Article (172)
A person shall attain the age of majority when he completes twenty one lunar years of
age.
Article (173)
After attaining the age of majority, the minor is entitled to ask the guardian to account for
his acts during the period of guardianship.
Chapter IV. Capacity Impediments
Article (174)
Capacity impediments are:
1) Insanity: The insane is a person who has lost his mental faculties continuously or at
intermittent intervals. Imbecility is treated the same way as insanity.
2) Prodigality: The prodigal is a spendthrift person.
3) Illness leading to death: It is the illness which impairs the human being from continuing
his usual activities and death is most likely to occur within one year. Should he remain in
the same condition for one year or more, without deterioration, his acts are similar to
those of a sound person.
4) Shall be considered as an illness leading to death circumstances where the person is
surrounded by danger of death and where perishing is prevalent in such circumstances
even though he is not ill.
Article (175)
1. Financial acts of the insane are valid if in a state of consciousness and void after putting
him under guardianship.
2. Acts of the imbecile subsequent to his interdiction shall be governed by the provisions
applied to the acts of the discerning minor.
3. Acts of the imbecile prior to his interdiction are valid unless they are the result of illicit
exploitation or connivance.
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Article (176)
Acts performed by a person on his deathbed, or in a similar state, are governed by the
Islamic doctrine as provided for by Article (2) of this Law.
Article (177)
The interdicted is entitled to file in person a lawsuit to remove the interdiction.
Title Two. Tutelage
Chapter I. General Provisions
Article (178)
1. Tutorship: It is tutelage on the person and on property.
A) Tutelage on the person:
It is the care of whatever is related to the person of the minor, his supervision,
protection, education, teaching, orientation and proper raising; this includes consent
to his marriage.
B) Tutelage on property:
It is the care of all what concerns the property of the minor, its safe-keeping,
management and investment.
2. Tutelage includes: guardianship, curatorship and judicial procuration.
Article (179)
With due compliance with the provisions relating to the marriage of a female stated in
Article (39) of this Law, shall be subject to tutelage the minor until he reaches the age of
majority, as well as the insane and imbecile of full age.
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Chapter II. Tutor Conditions
Article (180)
1. The tutor must be of sound mind having attained the full legal age, trustworthy able to
perform the tutelage requirements.
2. The tutor on the person must be trustworthy on the person of the minor, able to attend to
his affairs and of the same religion as the minor.
Chapter III. Tutelage on the Person
Article (181)
1. Tutelage on the person is for the father, then to the agnates from the father’s side by order
of their inheritance.
2. In case several persons are entitled and they are all in the same degree, of the same
strength of kinship and they are equal in maturity, tutelage shall be to the eldest; and if
they are different in maturity then the court shall choose the best among them.
3. Where there is no one entitled, the court shall appoint a tutor on the person from among
the minor’s relatives, if any is qualified, otherwise from among others.
Chapter IV. Withdrawal of Tutelage on the Person
Article (182)
Tutelage must be withdrawn from the tutor on the person in the following instances:
1) If he satisfies no more some of the tutelage conditions provided for in this Law.
2) If he perpetrates with the person under his tutelage, or with others, the crime of rape or
ravishment or has led him to prostitution or any similar criminal offence.
3) If the tutor has been condemned though a final judgment in an intentional misdemeanour
or felony perpetrated by him, or by others, against the person under his tutelage, or a
lesser offence.
4) If the tutor is condemned to detention for a period in excess of one year.
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Article (183)
1. Tutelage may be withdrawn from the tutor on the person, totally or partially permanently
or provisionally, in the following instances:
a) In case the tutor has been sentenced to a penalty restricting his freedom for a year or
less.
b) Should the person under tutelage become exposed to severe danger to his safety,
health, honour, morality or education due to mistreatment by the tutor or bad
example, because of the tutor’s bad reputation, addiction to alcohol or narcotics, or
absence of care.
It is not necessary, in this case that the tutor be sentenced to a penalty because of what is
mentioned above.
2. The court may, instead of withdrawing tutelage, in the above instances, entrust the minor
to a specialised social institution together with the continuity of the tutor’s tutelage.
Article (184)
In the cases mentioned in Articles (182) and (183) of this Law, the court may on its own
motion, or upon request of the investigation Authority, entrust the minor provisionally to
a trustee or to one of the specialised social associations until the tutelage matter is settled.
Article (185)
In case the tutelage is withdrawn as concerns some of those under his tutorship, it should
be withdrawn from the others as well.
Article (186)
Should the court decide to withdraw tutelage from the tutor on the person of his ward, to
limit it or stop it, tutelage shall pass to the one following in rank if he is qualified.
In case he refuses or is not qualified, the court may entrust tutelage to whomever it deems
qualified, even if he is not related to the minor, or entrust it to one of the specialised social
associations.
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Article (187)
In cases other than those where tutelage must be withdrawn, the court may reinstate, in
whole or in part, tutelage to the tutor on the person of the minor upon his request and
provided six months have elapsed since the disappearance of the cause of withdrawal.
Chapter V. Tutelage on Property
Article (188)
Tutelage on property is for the father alone then to the guardian named by him, if any,
then to the grandfather from among the agnates, then to the guardian named by him, if
any, then to the judge. None of these may renounce to his tutorship without authorisation
of the court.
Article (189)
The Property donated as a gift to the minor shall not be included in the tutelage should the
donator so provide.
Article (190)
The minor’s property and its accessories may not be leased or donated otherwise such acts
shall be void and shall entail liability and guaranty.
Article (191)
The tutor may not dispose of a real estate owned by the minor in such a way as to transfer
title thereto or establish a real right thereon without the authorisation of the court and for
reasons of necessity or evident interest as estimated by it.
Article (192)
The tutor may not borrow money to the benefit of the minor unless he is so authorised by
the court and without prejudice to the provisions of the Islamic Sharia.
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Article (193)
The tutor may not, without the court’s authorisation, lease an immovable property owned
by the minor for a period extending beyond one year after attaining the age of majority.
Article (194)
The tutor may not continue a trade that devolved to the minor without the authorisation of
the court and within the limits thereof.
Article (195)
The tutor may not, without the authorisation of the court, accept a donation or a will for
the minor if they are charged with obligations.
Article (196)
1. The tutor shall make a list of the minor’s property owned by, or devolving to him, and
shall deposit this list with the Clerks’ Office of the court of his domicile within two
months from the beginning of the tutelage or from acquiring title by the minor of the
property.
2. The court may consider the non-submission of the list or the delay in submitting it as
exposing the minor’s property to danger.
Article (197)
The tutor, by authorisation of the court, may spend on himself from the minor’s funds, if
the latter has a duty to provide alimony for the former. He may also spend from these
funds on those supported by the minor.
Chapter VI. Withdrawal of Tutelage on Property
Article (198)
Should the property of the minor be exposed to danger because of the tutor’s misdealing
or for any other cause, the court has to withdraw or limit the tutelage.
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Article (199)
The court shall order the cessation of tutelage should the tutor be considered absent or
incarcerated by virtue of a judgment sentencing him to a penalty restricting his freedom
for a period of one year or less.
Article (200)
The judgment withdrawing tutelage on the person of the minor shall result in its forfeiture
or cessation as concerns his property.
Article (201)
Where tutelage is withdrawn, limited or stopped, it shall not be reinstated except by
judgment of the court after ascertaining that the reasons therefore have ceased to exist.
Article (202)
The request for reinstatement of tutelage, that had previously been rejected, shall not be
accepted unless after the expiry of one year from the date of the final judgment of
rejection.
Chapter VII. Dealings of the Father and Grandfather
Article (203)
Tutelage of the father on his minor son’s property shall be for the purpose of safekeeping,
administration and investment.
Article (204)
Tutelage of the father includes his minor grandsons in case their father is interdicted.
Article (205)
Dealings of the father are supposed to be valid, namely in the following instances:
1) Contracting in the name of his son and disposing of his property.
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2) Trading for the account of his son but he shall not persevere in this trade except in case of
evident benefit.
3) Acceptance of the licit donations for his son’s benefit if it is devoid of any prejudicial
obligations.
4) Spending from his son’s funds on those his son is obligated to support.
Article (206)
Dealings of the father are contingent upon the authorisation of the court in the following
instances:
1) In case he purchases the property of his son for himself, his wife or any of his other
children.
2) If he sells to his son his property, the property of his wife or of his other sons.
3) If he sells his son’s property to invest the proceeds for his own account.
Article (207)
1. The father’s dealings are void if it is established that he miscarried them or if they are
devoid of any interest to the minor.
2. The father is considered liable, in his funds, in case of a gross mistake that caused
prejudice to his son.
Article (208)
Tutelage of the father shall be withdrawn from him if it is established to the judge that the
minor’s property have been exposed to danger as a result of his father’s dealings.
Article (209)
The provisions of this section, applicable on the father, shall apply to the grandfather.
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Chapter VIII. Termination of Tutelage
Article (210)
Tutelage ends when the minor attains the legal age of majority unless the court decides to
continue tutorship on him.
Article (211)
In case the tutelage on the person ends, it shall not be reinstated unless there exists one of
the causes of interdiction.
Article (212)
Upon termination of tutelage, the tutor, or his heirs, has to return the property of the
minor to him through the competent court.
Chapter IX. The Guardian
Article (213)
1. The father may appoint a guardian of his choice on his minor son, on the fetus in gestation
or on the minor children of his interdicted son. This is also possible for the donor, in the
case provided for in Article (189). The guardianship shall be submitted to the Court for
confirmation.
2. The father or the donor may, at any time, relinquish his choice.
3. The choice, as well as the relinquishment, must be established by a formal or informal
paper.
4. Should the minor or the fetus on gestation have no guardian or a grandfather from among
the agnates, the court shall appoint a guardian.
5. The guardian shall not dispose of the property of the fetus in gestation until its birth alive
at which time he will deliver the property to his legal tutor.
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Article (214)
Whenever the minor’s interest so require, the judge shall appoint an ad hoc or a
provisional guardian.
Article (215)
The guardian, whether chosen or appointed by the judge, must be equitable, capable,
trustworthy, enjoying full capacity, of the same religion as the person under his custody
and able to discharge the duties of guardianship. The following persons, namely, may not
be appointed guardians:
1) The person whom the father decided, prior to his death, to deprive from nomination as
long as this deprivation is based on strong reasons which the court, after investigation,
deems that it justifies this decision. Privation shall be established by a formal or informal
paper.
2) The person who, himself, one of his ascendants, descendants or spouse, is in judicial
litigation with the minor; or the person who is in a state of animosity with the minor or his
family should this be detrimental to the interest of the minor.
3) The person sentenced to a penalty limiting his freedom for one of the crimes against
morality, honour or honesty. Nevertheless, the lapse of a period of five years may lead, in
case of prejudice, to disregard this condition.
4) The person who has no legitimate means of living.
5) The person whose tutelage on another minor has been withdrawn or his guardianship
revoked.
Article (216)
The guardian shall be bound to observe the conditions and the duties entrusted to him in
the guardianship deed, unless they are in violation of the law.
Article (217)
The guardian may be a male or female, physical or juristic person, one or several,
independent or in conjunction with a supervisor.
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Article (218)
1. In case the guardians are several, none of them may unilaterally take any action unless the
testator has defined to each his competence. So, if guardianship is for a number of
guardians jointly, none of them may dispose without the approval of the others.
Nevertheless, any of them may take the necessary or urgent measures or those exclusively
to the interest of the minor, dispose of whatever is exposed to perishing if action is
delayed, or dispose of undisputed items such as restitution of deposits that unquestionably
belong to the minor.
2. In case of difference between the guardians, the matter shall be submitted to the court.
Article (219)
Guardianship is binding when expressly or impliedly accepted and the guardian may not
abandon it if accepted expressly or impliedly except through the competent court.
Article (220)
Should the father appoint a supervisor to control the acts of the guardian, the supervisor
must act accordingly in the minor’s interest and he shall be accountable to the court.
Article (221)
The conditions required from the supervisor are the same as those required from the
guardian.
Article (222)
1. The provisions applicable on the supervisor as to his appointment, removal, accepting his
resignation, remuneration and liability for default are the same as those governing the
guardian.
2. The court shall decide the termination of supervision whenever the reasons thereto ceased
to exist.
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Article (223)
The guardian has to administer, to upkeep and to invest the minor’s property and shall, to
this end, deploy the necessary care.
Article (224)
The acts of the guardian shall be under the control of the court; he is under obligation to
submit to it periodical accounts for his acts concerning the administration of the property
of the minor and of those who are in his condition.
Article (225)
The guardian may not perform the following acts without the authorisation of the court:
1) Disposal of the minor’s property by means of selling, buying, bartering, partnership,
pledge or any other act of disposition transferring title or establishing a real right.
2) Disposal of the bonds and shares or part thereof, as well as valuable movables or those
which are not perishable unless they are of trifle value.
3) Transfer of the minor’s debts or accept the transfer on him if he is indebted.
4) Investing the minor’s property for his account.
5) Borrowing money in favour of the minor.
6) Renting the minor’s real estate.
7) Acceptance or rejection of conditional grants.
8) Spending from the minor’s funds on those whose alimony is due on the minor unless such
alimony is established by an enforceable judgment.
9) Payment of the matured obligations on the estate or on the minor.
10) Acknowledging a right against the minor.
11) Compromise and arbitration.
12) Filing a lawsuit if the delay in filing it is not prejudicial to the minor or results in the
forfeiture of one of his rights.
13) Withdrawal of a suit and waiver of legal means of appeal.
14) Selling or leasing the minor’s property for himself, his spouse or one of their ascendants
or descendants or to one whom the guardian is his representative.
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15) The amount spent for the minor’s marriage such as dowry or the like according to the
regulations in force.
16) Education of the minor if he is in need to alimony.
17) Expenditures required by the minor to start a specific profession.
Article (226)
It is forbidden to the Body in charge of the minor’s affairs or any competent official
therein to purchase or lease, for himself, his spouse or one of his ascendants or
descendants, any of the properties owned by the minor; as well as to sell to the minor any
property owned by the said Body or its representative, his spouse or any of his ascendants
or descendants.
Article (227)
Guardianship shall be without remuneration unless, upon the guardian’s request, the court
decides to fix him a salary or compensation in consideration of a specific work to which
the guardian asked to be paid a customarily accepted remuneration.
Chapter X. Termination of Guardianship
Article (228)
The duties of the guardian shall terminate in the following instances:
1) His death, total or partial incapacity.
2) Upon evidence that he is missing or absent.
3) Acceptance of his request to abandon his mission or if he has been discharged therefrom.
4) Impossibility to discharge the guardianship’s duties.
5) Considering the minor of full capacity or upon his attaining the age of majority.
6) Removal of interdiction from the interdicted.
7) Recovering capacity by the minor’s father.
8) Death of the minor or the interdicted.
9) Termination of the duty for which the guardian was appointed to discharge or expiry of
the period of his appointment.
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Article (229)
Where the minor reaches the age of majority insane or not apt to be entrusted his
property, the guardian has the obligation to inform the court to consider extending
guardianship after his becoming of full age.
Article (230)
Discharge of the guardian shall be decided by the court in case:
1) any cause of disqualification for guardianship arises even if this cause existed when he
was appointed; or
2) of mismanagement or negligence or if his maintenance as a guardian constitutes a danger
to the interests of the minor.
Article (231)
1. Upon termination of his task, the guardian has to deliver the minor’s properties and all
related accounts and documents to the concerned person, under the supervision of the
court, within a period not exceeding thirty days therefrom. Moreover, he has to deposit
with the Clerks’ Office at the competent court, within the said period, a copy of the
accounts and the report evidencing the delivery receipt of the properties. In this respect,
the court shall observe, when necessary, the provisions concerning criminal liability.
2. Shall be void, any undertaking, clearance or discharge obtained by the guardian from the
minor who has reached the age of majority within one year from the date of ratification of
the accounts by the court.
Article (232)
Should the guardian pass away or be interdicted or declared absent, his heirs, his legal
substitute or the person taking possession of the property, as the case may be, must
forthwith inform the court thereof in order to take the necessary measures to protect the
minor’s rights and hand over the minor’s property and submit the relative accounts.
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Title Three. The Absent and the Missing
Article (233)
1. The absent is the person whose domicile or residence is unknown.
2. The missing is the person of whom it is not known whether he is alive or dead.
Article (234)
In case the absent or the missing has no proxy, a judicial proxy shall be appointed to
administer his property.
Article (235)
An inventory shall be made of the property of the absent or the missing person upon
appointing the judicial proxy and the property shall be administered in accordance with
the administration of the minor’s property.
Article (236)
The status of the missing ends:
1) If the life or death of the missing person is established.
2) If a judgment is rendered declaring the death of the missing person.
Article (237)
1. Under all circumstances, the judge must search, by all means, for the missing person in
order to ascertain whether he is alive or dead before adjudicating his death.
2. The judge shall declare the death of the missing person if there is evidence of his death.
3. The judge shall adjudicate the death of the missing person, one year after he is declared
missing upon request of the concerned persons, in cases were perishing is prevalent, or
four years in ordinary circumstances.
4. The properties of the missing person who has been declared dead shall not be allocated
unless after the lapse of fifteen years from the date he is declared missing.
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Article (238)
The day on which the judgment, declaring the missing person dead, is rendered shall be
considered the date of his death.
Article (239)
Should the missing person be declared dead then appears alive:
1) His wife returns to him in the following instances:
a) If her second marriage is not consummated;
b) In case her second husband knows that her first husband is alive.
c) If the second husband married her during her waiting period.
2) He can claim his estate from his heirs except the portion that perished.
BOOK FOUR. THE TESTAMENT
Title One. General Provisions
Article (240)
A testament is an act of disposition of the succession after the death of the testator.
Article (241)
A testament can be absolute, at term after death, subject to a valid condition precedent or
subsequent.
Article (242)
Should the will be subject to a condition contrary to the Sharia aims or to the provisions
of this Law, the condition is void but the will is valid.
Article (243)
The will is enforceable within the limit of one-third of the testator’s estate, after paying
the rights thereon and is valid beyond this third, within the limits of the share of the major
heir who accepted it.
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Article (244)
Any act of disposition taken in articulo mortis as a gift or by favouritism shall be
governed by the provisions applicable to wills regardless of the characterisation given to
it.
Title Two. Basic Elements and Conditions of a Will
Chapter I. Basic Elements
Article (245)
The basic elements of a will are: The wording, the testator, the legatee and the bequeathed
property.
Article (246)
A will is formed by words or in writing and if the testator is unable to so express himself
then by a recognisable sign.
Article (247)
Where a will is denied, the lawsuit concerning a will or revocation thereof shall not be
heard except through the means of proof admitted by law.
Article (248)
1. A will is valid if made by a person having the capacity to donate, even if it is done in
articulo mortis, with due compliance with the provisions of Articles (174) and (176) of
this Law.
2. The will of an interdicted for prodigality or carelessness is valid if made for good deeds
with authorisation of the court.
3. The testator may amend or revoke a will totally or partially.
4. Disposal of the bequeathed property by the testator is considered a revocation of the will.
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Article (249)
The will is valid if made to a person qualified to own the object of the legacy even if he is
of a different religion.
Article (250)
A will may not be made to an heir unless approved by all other major heirs; it is then
executable on the share of the one who consented.
Chapter II. Conditions of Validity of a Will
Article (251)
1. A will is valid if made to a living specific person or to a fetus.
2. A will is valid if made to a limited or unlimited class of people.
3. A will is valid if made for charity purposes admitted by law.
Article (252)
1. A will made to a specific person must be accepted by the beneficiary, after the death of
the testator or during his life provided this acceptance continues after his death.
2. Should the beneficiary be a fetus, a minor or an interdicted, acceptance of the will has to
be made by the one who has the curatorship on his property, as he may reject it after
securing the judge’s authorisation.
3. A will to an unspecified person does not need acceptance or rejection by any one.
4. Acceptance on behalf of Bodies, institutions and foundations shall be given by their legal
representatives who may reject the will after securing the approval of the judge.
Article (253)
1. Acceptance of the will has not to be given immediately after the death of the testator.
2. Silence of the beneficiary for a period of thirty days subsequent to his knowledge of the
will shall be considered as an approval thereof.
So, if the testament is charged with an imposition, the above period shall be extended to
fifty days unless there is an acceptable reason for its waiver.
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Article (254)
The testator has the complete capacity to revoke the will totally or partially.
Article (255)
Should the beneficiary die prior to the death of the testator without accepting or rejecting
the will, it shall devolve to his heirs unless it is charged with impositions.
Article (256)
1. The specified beneficiary shall own the object of the legacy as of the date of death of the
testator provided he accepts the will.
2. The heir of the beneficiary, who died prior to partition, shall substitute him.
3. In case there is more than one beneficiary, the object of the legacy shall be equally
apportioned between them, unless otherwise provided by the testator.
4. The living of the twins shall take the entire legacy should the other be born dead.
Article (257)
1. A will bequeathed to a class of people, undeterminable in future, shall include those
among them who exist upon the death of the testator and those who shall exist in future.
2. The number of the unspecified class shall be limited by the death of their fathers or there
is no hope left for the living among them to have off-springs.
3. In case it is hopeless for any of the beneficiaries to exist, the legacy shall return to the
succession.
Article (258)
The existing persons of the unspecified class shall benefit of the legacy and their shares
therein shall change on each birth or death.
The proceeds of the legacy shall be divided among the existing of the undetermined who
cannot be restrictively enumerated.
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Article (259)
The object of the legacy shall be sold to the undetermined if it is feared that it be lost or
devaluated and the sale proceeds shall be used to purchase what can be of benefit to the
beneficiaries.
Article (260)
1. The subject matter of the will, for legally admitted charity purposes, shall be spent to the
benefit thereof.
2. The proceeds of the legated property to expected institutions shall be paid to the most
similar one until it legally comes into existence.
Article (261)
The legacy must be the property of the testator and the object of the will be legitimate.
Article (262)
1. The legacy may be general or specific.
2. The general legacy shall include all the assets of the testator, present and future.
Article (263)
The general will shall be executed up to one-third of the succession.
Article (264)
1. The specified legacy may be a real estate or a movable, fungible or non-fungible, naked
property, interest, usufruct in land or chattels for a definite or unspecified period.
2. Whoever legates a specified thing to a person then legates it to another, it shall be divided
between them unless there is evidence that meant to revoke the will made to the first.
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Chapter III. The Legacy of Usufruct and Loaning
Article (265)
1. Where the value of the specified legacy, whose usufruct or use of it has been legated, is
less than one-third of the succession, the land shall be delivered to the beneficiary to
benefit from it according to the will.
2. If the value of the specified property which usufruct or use has been bequeathed and if the
consideration for the usufruct for the specified period is more than one-third the
succession, the heirs shall have the choice either to ratify the will or to give the
beneficiary the equivalent of one-third the succession.
3. If the legacy is for usufruct for the whole life of the beneficiary, the will shall be assessed
as per the value of the corpus of property.
4. A will is valid if made as a loan of a fixed sum granted to the beneficiary and shall not be
enforceable for the portion of this amount in excess of one-third of the loan except with
the consent of the heirs.
Article (266)
The beneficiary of a will granted the usufruct of a specified property shall be entitled to
use it or exploit it even contrary to the purpose specified in the will provided it does not
adversely affect the corpus of the property.
Chapter IV. Legacy Equal to the Share of an Heir
Article (267)
If the legacy is equal to the share of a specified heir from among the testator’s heirs, the
beneficiary shall be entitled to the same share of this heir plus his share in the estate.
Article (268)
If the legacy is the share of an undetermined heir among the testator’s heirs or equal to
his, the beneficiary shall be entitled to the share of one of the heirs over and above his
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share in the estate, in case the heirs have equal shares, and the share of the heir who has
the smallest share over and above his share in the estate, if they have not equal shares.
Article (269)
The beneficiary of a share equal to that of an heir, whether male or female, shall be
entitled to his share up to one-third and the portion in excess of this one-third shall be
taken from the share of the major heir who consented to the will.
Chapter V. Voidance of the Will
Article (270)
A will is void in the following instances:
1) Express or implied revocation of the will by the testator.
2) Death of the beneficiary during the life of the testator.
3) Rejection of the will by the beneficiary during the life of the testator or after his death.
4) Murder of the testator by the beneficiary whether the latter is the author, accomplice or
accessory of the crime provided that, upon perpetrating the crime, he was of sound mind
having reached the capacity required for criminal liability regardless of whether the
killing took place prior or subsequent to the will.
5) Perishing of the specified subject matter of the bequest or its entitlement by a third
person.
6) Apostasy from Islam of the testator or the beneficiary unless he returns to it.
Article (271)
Should the beneficiary become an heir to the testator, his entitlement to the will shall be
conditional upon the approval of the other heirs.
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Chapter VI. The Mandatory Will
Article (272)
1. Whoever dies or is considered dead by decision of the court and has grandsons from his
son or his daughter and this latter died before or with the testator, the grandsons shall be
entitled to a mandatory will for one-third of the estate within the following limits and
conditions:
a) The mandatory will for these grandsons shall be equal to their share that their father
would have inherited from his father had he survived him, provided it does not
exceed one-third of the estate.
b) The above-mentioned grandsons shall not be entitled to a mandatory will if they
inherit their ascendant, grandfather or grandmother, or if this ascendant did not
bequeath to them or grant them in his lifetime, without consideration, an amount
equal to their entitlement under the mandatory will. In case he bequeathed to them
below this amount it must be completed and if more than the said amount, the excess
shall be considered a voluntary will. Should he bequeath to some of them only, the
others shall be entitled to the mandatory will, each according to his share.
c) The right to the mandatory will shall be to the children of the son or the daughter or
their descendants, without limitation and regardless of their number, the male’s
share shall be twice the share of a female. The ascendant shall disinherit his own
descendants only and the descendant shall only be entitled to the share of his
ascendant.
2. The mandatory will is prevalent to the voluntary wills as to its execution on the one-third
of the estate.
3. The murderer and the defector shall be deprived from the benefit of the mandatory will, in
accordance with the provisions of this Law on Testaments.
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Chapter VII. Wills in Competition
Article (273)
Should the one-third be short of satisfying the wills of equal rank and the major heirs did
not approve the portion in excess thereof, the one-third shall be apportioned in equal
shares between the beneficiaries. In case the subject matter of a will is a specific thing it
will be set off against its price so that the deserving beneficiary shall take his share from
the specified object and the others shall take their share from the balance of the whole
third.
BOOK FIVE. SUCCESSION AND INHERITANCE
Title One. Successions
Chapter I. General Provisions
Article (274)
Succession is what the decedent leaves, assets and financial rights.
Article (275)
Rights are attached to succession; some have precedence over the others according to the
following order:
1) Burial expenditures.
2) Payment of the decedent’s debts due to God or to human beings.
3) Execution of wills.
4) Distribution of the balance of the succession on the heirs.
Article (276)
Ascertainment of death and succession:
1) The person who claims ascertainment of death and succession has to submit an
application in this respect to the competent court which shall include statements
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concerning the date of death, the last domicile of the decedent, names of the heirs and
their domicile, the legatees and their domicile and the entire movable and immovable
properties of the estate.
2) The Clerks’ Office shall give notice to the heirs and the legatees to appear before the
court at the date to be fixed for this purpose. The judge shall examine the testimony of
those he trusts and may add to this the administrative investigations, as he sees fit.
3) The ascertainment of death and succession stands as a conclusive evidence unless
otherwise adjudicated or if the court decides to stay its conclusiveness. The court shall
issue a certificate of inheritance limiting the heirs and indicating the shares of each in the
succession.
Article (277)
The procedures for liquidation of the estate are the following:
1) In case the decedent did not appoint an administrator for his estate, any of the concerned
persons may ask the judge to appoint an administrator unanimously chosen by the heirs
from among them or from others and in case they fail to reach such an agreement, the
judge shall choose one after hearing the heirs’ statements.
2) Special provisions shall be complied with if there is among the heirs an unborn fetus, a
fully incapacitated or an heir lacking capacity or an absentee.
Article (278)
Should the decedent appoint an administrator for his estate, the judge must, upon request
of one of the concerned persons, ratify this appointment but the administrator may ask to
be excused from such nomination.
Article (279)
Upon request of one of the concerned persons or of the public prosecution or even
without any request, the judge may dismiss the administrator and appoint another
whenever there is a justification for this decision.
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Article (280)
1. The court shall enter in a special register the orders of appointment or of ratification of
administrators, in case they are appointed by the decedent, or their dismissal or
withdrawal.
2. This entry shall produce its effect on those who deal with the heirs as concerns the real
estates of the succession.
Article (281)
1. The administrator of the estate shall, after his appointment, take delivery of the estate’s
assets that he shall undertake to liquidate under the supervision of the judge. He may
claim a remuneration to be fixed by the judge.
2. The estate shall bear the liquidation expenses which shall have the priority given to
judicial expenses.
Article (282)
The judge shall, when necessary, take whatever is necessary to preserve the estate and
order the deposit of cash money and financial securities and valuables at the Treasury of
the court in whose jurisdiction the estate’s property, totally or the largest part of it, is
located until the liquidation is completed.
Article (283)
The administrator of the estate shall spend from the estate’s funds:
1) The burial expenses.
2) A sufficient and reasonable alimony to the needy heir until the liquidation is completed
and after obtaining an order of payment from the judge, provided the alimony obtained by
each heir shall be deducted from his share in the estate.
3) The judge shall settle all litigations arising in this respect.
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Article (284)
1. As from the appointment of the estate’s administrator, the creditors may neither take any
measure against the estate nor continue any measure already initiated except against the
administrator of the estate.
2. Whenever so requested by the concerned persons, all measures taken against the decedent
shall be stayed until the settlement of all the estate’s debts.
Article (285)
Prior to receiving an attestation showing his share in the net assets of the succession, the
heir may not dispose of the estate, as he may not take any of the debts due by the estate or
compensate a debt on him with one on the estate.
Article (286)
1. The administrator of the estate has to take all measures to preserve its assets and perform
the necessary administration acts and represent the estate in the lawsuits and recover the
debts in its favour.
2. The administrator shall assume the same liability as that of the remunerated proxy, even if
he is not salaried, and the court may ask him to account for his administration at fixed
intervals.
Article (287)
1. The administrator of the estate shall invite its creditors and debtors to submit a statement
of their rights and of the debts owed by them, within a period of two months as of the date
of publishing this notice.
2. The notice must be affixed on the bulletin board, of the court of the last domicile of the
decedent as well as the court within whose jurisdiction all or most of the estate’s assets
are located, and be published in a daily paper.
Article (288)
The administrator of the estate has to deposit with the court which ordered his
appointment, within three months from the date of his appointment, an inventory
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statement of all the rights and dues of the estate as well as an assessment of the value
thereof and notify the concerned persons of such deposit through registered mail with
acknowledgment of receipt.
The administrator may ask the court to extend this period should he have a justification
for such request.
Article (289)
For the purpose of assessing and inventorying the estate’s assets, the administrator of the
estate may seek the assistance of an expert and he must record all that the decedent’s
documents may reveal. The heirs have to inform him of all the debts and rights of the
estate that came to their knowledge.
Article (290)
Shall be sentenced to the penalty provided for in the Penal Law, for embezzlement,
whoever fraudulently appropriated any of the estate’s property even if he is an heir.
Article (291)
Any dispute over the accuracy of the inventory shall be submitted, through a lawsuit, to
the competent court within thirty days as of the date of depositing the inventory
statement.
Chapter II. Settlement of the Estate’s Debts
Article (292)
1. Subsequent to the expiry of the delay fixed for contesting the inventory statement, the
administrator shall, after securing the permission of the court, pay the undisputed debts.
2. The disputed debts shall be settled after deciding on their accuracy by a decisive
judgment.
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Article (293)
In case the estate is declared bankrupt or likely to be declared so, the administrator shall
stop settling any debt, even if undisputed, until all the litigations concerning the debts of
the estate are finally settled.
Article (294)
1. The administrator of the estate shall pay its debts from the rights collected, the cash
money included, the price of the chattels comprised therein and, in case they fall short,
then from the price of the real estates.
2. Chattels of the estate and its immovable properties shall be sold by auction and in
accordance with the procedures and within the delays provided for forced sales in the Law
of Civil Transactions, unless the heirs agree otherwise. In case the estate is bankrupted,
the approval of all creditors should be secured in the manner agreed upon by the heirs
who have, in any case, the right to participate in the auction.
Article (295)
Debts unsecured by real mortgage shall mature upon the death of the decedent and the
judge, upon request of all heirs, shall decide that the debts secured by real mortgage have
fallen due and shall determine the amount due to the creditor.
Article (296)
After allocating the undue debts that are secured by real mortgage, each heir may pay his
share of the debt prior to maturity.
Article (297)
Debtors who have not been paid their dues because their rights do not figure in the
inventory statement, and who have no mortgages on the estate’s assets, may not have a
claim against those who have acquired in good faith a real right on these assets but they
may have a claim against the heirs to the extent of what they received from the estate.
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Article (298)
Subsequent to the settlement of its debts, the administrator shall execute the decedent’s
wills and other charges.
Chapter III. Delivery and Partition of the Estate’s Assets
Article (299)
Subsequent to the fulfilment of the estate’s obligations, the balance of its assets shall
devolve to the heirs, each according to his legal share.
Article (300)
1. The administrator of the estate shall deliver to the heirs the property that devolved to them
from the estate.
2. Upon the expiry of the period fixed for the disputes concerning the inventory of the estate,
the heirs may claim delivery of all or part of the objects and the cash money that are not
required for liquidation against submitting a guarantee or without it.
Article (301)
Every heir is entitled to ask the administrator of the estate to deliver to him his share in
the estate parcelled out unless the said heir is bound to remain in joint ownership either by
agreement or according to a law provision.
Article (302)
1. The estate that is not over covered with debts may be partitioned prior to the payment of
debts due on it provided a portion of this estate is allocated for the payment of the debts
including these secured by a real mortgage.
2. In case the application for partition is accepted, the administrator of the estate shall make
the partition provided it shall not become final unless accepted by all heirs.
3. Should the heirs do not unanimously agree to the partition, the administrator of the estate
shall request the court to proceed with it according to the law provisions and the expenses
of the partition lawsuit shall be deducted from the shares of the heirs.
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Article (303)
The partition of the estate shall be governed by the rules applicable to partition in general
and by the provisions of the following Articles.
Article (304)
Should there be among the assets of the estate a property that may be exploited for
agriculture, industry or commerce and considered as an independent entity, and if the
heirs do not agree to continue the exploitation and the property is not encumbered with
any third-party rights, the property as a whole shall be allocated to the heir who claims it
if he is the most apt to take care of it and provided its value is determined and deducted
from his share in the estate. In case all the heirs have equal aptitudes, the property shall be
allocated to the heir among them who gives the highest price provided it is not below the
price paid for a similar property.
Article (305)
Unless otherwise agreed, should one of the heirs be allocated, upon partition, a debt on
the estate, the other heirs shall not guarantee the debt in case he is declared bankrupt after
the partition.
Article (306)
The will allocating the assets of the estate between the heirs of the testator so that the
share of each heir, or some of them, is determined, shall be valid.
In this case, it shall be treated as a will to an heir.
Article (307)
Partition to take effect after death may be revoked but it becomes binding upon the death
of the testator.
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Article (308)
Should partition not include all the decedent’s assets upon his death, the property not
included in the partition shall devolve as joint property to the heirs in accordance with the
rules on succession.
Article (309)
Should one or more of the prospective heirs who have participated in the partition die
before the decedent, the parcelled out share allotted to the deceased heir shall devolve in
the joint property to the other heirs, in accordance with the rules governing successions,
without prejudice to the provisions applicable to the mandatory will.
Article (310)
The partition to take effect after death shall be subject to the rules governing partition in
general, except the provisions concerning burdensome contracts.
Article (311)
In case the partition does not include all the estate’s debts or included it but the partition
was not approved by the creditors, any heir, in case of disagreement with the creditors,
may request the court to do the partition and settle the debts provided that the partition
mentioned in the decedent’s will and the reasons therefore be taken, as much as possible,
into consideration.
Chapter IV. Non-Liquidated Successions
Article (312)
If the succession is not liquidated according to the preceding provisions, the ordinary
creditors of the estate may implement their rights or what has been bequeathed to them on
the real properties of the succession that has been disposed of or has been encumbered
with real rights to third parties, if they lay an attachment on these properties in
consideration of their rights prior to registration of these transactions.
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Title Two. Inheritance
Chapter I. General Provisions
Article (313)
Inheritance is the imperative devolution of the property and financial rights upon the
death of their owner to those deserving.
Article (314)
The main elements of inheritance are:
1) The decedent.
2) The heir.
3) The succession.
Article (315)
The causes of inheritance are: marriage and kinship.
Article (316)
Entitlement to succession is subject to the following conditions: Death of the decedent in
reality or by judgment; the presence of the heir alive upon the real or assumed death of
the decedent; knowledge of the whereabouts of the succession.
Article (317)
Among the causes of debarment from succession, the deliberate murder of the decedent
whether the murderer is the principal offender, an accomplice or the one who caused the
death. The killing should be without right or excuse and the murderer must be of sound
mind enjoying full capacity.
Article (318)
There is no inheritance between persons of different religions.
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Article (319)
In case of death of two or more persons who inherit from each other and it is not known
who died first, no one is entitled to the succession of the other.
Article (320)
Inheritance may be forced, agnatic or both then cognatic.
Chapter II. Forced Inheritance and Heirs (Fouroud)
Article (321)
1. Forced inheritance: is a fixed share for an heir in the estate.
2. The fixed shares are: one-half, one-quarter, one-eighth, two-thirds, one-third, one-sixth,
and one-third of the balance.
3. The forced heirs are: The two parents, the spouses, paternal grandfather or his agnate
ascendants, the grandmother who is not related to the decedent by an heir, daughters, the
daughters of the son or of his descendants, sisters in the absolute, and the cognate brother.
Article (322)
Those who receive one-half of the estate:
1) The husband provided that the wife has no succeeding descendant.
2) The daughter provided the decedent has no other child, male or female.
3) The daughter of the son or of his descendants provided the decedent has no child or
grandchild equal or higher in degree with her.
4) The germane sister, if she has no brother, other sisters, a succeeding descendant to the
decedent, father or paternal grandfather.
5) The consanguine sister, if she is one and there is no consanguine brother, germane brother
or sister, a succeeding descendant to the decedent, a father or a paternal grandfather.
Article (323)
Those who receive one-quarter of the estate:
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1) The husband in case the wife has a succeeding descendant.
2) The wife, even if several, should the husband have no succeeding descendant.
Article (324)
Those who receive one-eighth of the estate:
The wife, even if several, should the husband have a succeeding descendant.
Article (325)
Those who receive two-thirds of the estate:
1) Two or more daughters, if the decedent has no sons.
2) Two or more daughters of the son, or of his descendants, if the decedent has no direct son,
grandson of the same degree as the son’s daughters or a grandchild of a higher degree.
3) The two or more germane sisters in the absence of a germane brother, a succeeding
descendant of the decedent, father or paternal grandfather.
4) The two or more consanguine sisters, in the absence of a consanguine brother, a germane
brother or sister, a succeeding descendant of the decedent, father or paternal grandfather.
Article (326)
Those who receive one-third of the estate:
1) The mother, if the decedent has no succeeding descendant, or if there is absolutely none
of the brothers and sisters, unless she inherits with one of the spouses and the father
restrictively, then she is entitled to one-third of the remainder.
2) Two or more of the mother’s children in the absence of a succeeding descendant of the
decedent, a father, a paternal grandfather. This third shall be equally divided between
them, male and female.
3) The paternal grandfather, if he concurs with the germane or consanguine brothers or both,
if they are more than two, or a corresponding number of sisters, and in the absence of
forced heirs.
Article (327)
Those who receive one-sixth of the estate:
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1) The father in concurrence with a succeeding descendant.
2) The paternal grandfather, in the following instances:
a) If the decedent has a succeeding descendant.
b) In the presence with him of forced heirs and where his share is less than one-sixth or
one-third of the remainder or if nothing is left after they have taken their forced
shares.
c) If he has with him a forced heir and more than two brothers or an equal number of
sisters, whether germane or consanguine, and his share of one-sixth is better to him
than the two-thirds of the remainder.
3) The mother with the succeeding descendant of the decedent or with two or more of the
brothers or sisters, in the absolute.
4) One or more grandmother and her ascendants provided she is not debarred from
inheritance.
5) One or more daughter of the son or of his descendants if she inherits with a single
consanguine daughter or with a single son’s daughter who is higher in degree, provided
there is no son or grandson in a higher or in an equal degree compared to her.
6) One or more consanguine sister with a single germane sister if the decedent has no
succeeding descendant, or father, paternal grandfather brother or consanguine brother.
7) A single uterine brother or sister in the absence of a succeeding descendant of the
decedent, a father or paternal grandfather; with due observance of Article (347) of this
Law.
Article (328)
Those who receive one-third of the remainder:
1) The mother with one of the spouses and the father, if the decedent has no succeeding
descendant or two or more of the brothers or sisters, in the absolute.
2) The paternal grandfather if he is with a forced heir and more than two brothers or an equal
number of germane or consanguine sisters, provided the one-third of the remainder is
better for him than the one-sixth.
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Chapter III. Male Agnates (Asaba)
Article (329)
1. Agnates are entitled to an undetermined share in the estate.
2. Agnates are of three kinds:
a) Agnates per se.
b) Agnates by others.
c) Agnates with others.
Article (330)
Agnates per se are of four directions, one preferred on the others according to the
following order:
1) Descendants: including sons and grandsons of the son and of his descendants.
2) Fatherhood: including the father and the paternal grandfather and his ascendants.
3) Brotherhood: including germane or consanguine brothers and their descendants.
4) Paternal Uncles: including the paternal uncles of the deceased, whether germane or
consanguine, paternal uncles of his father, paternal uncles of the consanguine paternal
uncles and his ascendants, whether germane or consanguine, or the germane or
consanguine sons of the paternal uncles and their descendants.
Article (331)
The agnate per se is entitled to the estate if there are no forced heirs and is entitled to the
remainder, if any, and shall receive nothing if the shares of the forced heirs exhaust the
whole succession.
Article (332)
1. Shall have precedence among the agnates the preferred class according to the order stated
in Article (330) of this Law, then the nearer degree to the deceased, in case of equality in
class, then the closest relative in case of equal degrees.
2. The agnates shall participate in their entitlement to their share in the succession in case
they are of the same class and of equal degrees and strength of kinship.
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Article (333)
Should the paternal grandfather participate in the succession with the germane or
consanguine brothers or both, male or female or mixed, and whether or not there are with
them forced heirs, the grandfather shall inherit as an agnatic heir, being considered as
another brother to the deceased, unless the one-sixth or the one-third of the remainder is
better for him; with due regard to the provision of Article (346) of this Law.
Article (334)
1. Agnates by others:
a) One or more daughter with one or more son.
b) One or more daughter of the son or of his descendants, however remote, with one or
more grandson, whether he be of the same or of a lower degree than her, if she needs
him, and he will debar her if he is of a higher degree.
c) One or more germane sister with one or more germane brother.
d) One or more consanguine sister with one or more consanguine brother.
2. In these instances, the male shall inherit double the share of a female heir.
Article (335)
Agnates with others: One or more germane or consanguine sister with one or more
daughter or the son’s daughter. In this case, she shall be considered as the brother in the
entitlement to the remainder and in excluding the other agnates.
Chapter IV. Forced and Agnatic Heirs
Article (336)
Heirs succeeding as both forced and agnates are:
1) The father or the paternal grandfather with the daughter or the son’s daughter and his
descendants.
2) The husband, if he is the son of the paternal uncle of the deceased, shall receive his share
as a forced heir and his entitlement as an agnate.
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3) One or more uterine brother, if he is the son of the paternal uncle of the deceased, he shall
receive his share as a forced heir and his entitlement as an agnate.
Chapter V. Exclusion And Debarment
Article (337)
1. Exclusion is the debarment of an heir of all or part of the succession because of the
presence of another more entitled heir.
2. Exclusion is of two kinds: Debarring exclusion and decreasing exclusion.
3. The excluded from inheritance may exclude an heir other than himself.
4. The prohibited from inheritance does not debar an heir other than himself.
Article (338)
1. The paternal grandfather is excluded by the father and by every agnatic grandfather from
whom he originated.
2. The nearest grandmother excludes the remote unless the parenthood is from the father’s
side then she does not exclude the more remote from the mother’s side. The mother
excludes the agnatic grandmother, in the absolute, and the father excludes the paternal
grandmother. The agnatic grandfather excludes the grandmother if she is his ascendant.
Article (339)
The uterine brothers are excluded by the father, the agnatic grandfather and his
ascendants, the son, the grandson and his descendants.
Article (340)
The son, grandson and his descendants exclude the son’s daughter who is lower in degree
than him and she is also excluded by two daughters or two granddaughters of a higher
degree unless she is with one with whom she becomes agnate.
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Article (341)
Each of the father, son, grandson and his descendants exclude the brothers and the
germane sisters.
Article (342)
Each of the father, son, grandson and his descendants exclude the agnatic sister and she is
also excluded by the germane brother and sister, if she is an agnate with others in
accordance with the provisions of Article (335) of this Law. She is also excluded by two
germane sisters in the absence of a consanguine brother. The consanguine brothers are
excluded by each of the father, son, grandson and his descendants, the germane brother
and sister if the latter is an agnate with others.
Chapter VI. Reallocation by Increase or Decrease of Shares
Article (343)
Reallocation by increase of shares (Rad’): is the increase in the share of the forced heirs in
proportion of their original shares, in case the estate is larger than the total shares.
Article (344)
If the shares of the forced heirs do not exhaust all of the estate and there are no agnatic
relatives, the excess shall revert to the forced heirs, other than the spouses, in proportion
of their shares. The balance of the estate shall revert to one of the spouses in case there
are no agnate relatives or forced heirs or relatives other than the forced heirs and the
agnates.
Article (345)
1. Reallocation by decrease of shares: is the decrease in the shares of the forced heirs, in
proportion to their shares, in case the shares exceed the common denominator of the
estate.
2. The new common denominator shall become the base on which the estate shall be
divided.
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Chapter VII. Special Problems
Section 1. Al Akdarieh
Article (346)
The presence of the grandfather makes the germane or consanguine sisters agnates and
they do not inherit with him as forced heirs except in Akdarieh which is the case of the
spouse with a mother, grandfather, germane or consanguine sister.
The father receives one-half, the mother one-third, the grandfather one-sixth; the sister
has a forced share of one-half which shall be added to the one-sixth which is the share of
the grandfather and the total to be divided between the two, the male receiving the share
of two females.
Section 2. Al Mushtaraka
Article (347)
The germane brother inherits as agnates except in Al Mushtaraka which is the case of a
spouse, mother or grandmother, a number of uterine brothers and sisters, a germane
brother or more.
The spouse receives one-half, the mother or grandmother one-sixth and the one-third shall
be divided between the uterine and germane brothers and sisters, the male takes the share
of two females.
Section 3. Al Malikiya and Quasi-Malikiya
Article (348)
The grandfather does not exclude the germane or consanguine brother except in Al
Malikiya and quasi-Malikiya:
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Al Malikiya: a husband, mother, grandfather, uterine brothers, consanguine brother: the
husband receives one-half, the mother one-sixth and the rest to the grandfather being an
agnate.
Quasi-Malikiya: a husband, mother, grandfather uterine brothers, germane brother: the
husband receives one-half, the mother one-sixth and the rest to the grandfather being an
agnate.
Chapter VIII. Cognates (Zawi Al Arham)
Article (349)
The cognates are of four kinds:
First Kind:
The daughters’ sons and the granddaughters’ sons and their descendants.
Second Kind:
Maternal grandfathers and grandmothers and their ascendants.
Third Kind:
1) The uterine brothers’ sons and their descendants.
2) Children of the sisters, in the absolute, and their descendants.
3) The sons’ daughters, in the absolute, their sons and descendants.
4) The daughters of the brothers’ sons, in the absolute, however remote and their
descendants.
Fourth Kind:
It includes six groups:
1) Uterine uncles, from the paternal side, of the deceased, his aunts, in the absolute, and his
uncles and aunts from the maternal side, in the absolute.
2) The sons of those mentioned in the above clause and their descendants, the female
cousins, germane or consanguineous, of the deceased, their sons’ daughters and their
descendants as well as the sons of those mentioned and their descendants.
3) The uterine uncles of the deceased’s father, his aunts from the paternal side, uncles and
aunts from the maternal side (relatives of the father); Uncles and aunts, in the absolute, of
the deceased’s mother (relatives of the mother).
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4) The sons of those mentioned in the above clause and their descendants, the cousins of the
deceased’s father (germane, consanguineous or uterine); their sons’ daughters and their
descendants without limitation.
5) Paternal uterine uncles of the deceased’s paternal grandfather; paternal uncles of the
deceased’s grandmother (mother of his father); paternal aunts of the deceased’s parents
(both sides) and their maternal uncles and aunts, in the absolute, (relatives of the father);
paternal uncles and aunts of the grandparents of the deceased’s mother; maternal uncles
and aunts of the deceased’s mother, in the absolute, (relatives of the mother).
6) The sons of those mentioned in the preceding clause and their descendants; the deceased’s
paternal uncles of the germane or consanguine grandfather and their sons’ daughters and
their descendants; the children of those mentioned and their descendants.
Article (350)
1. In the first kind of cognates, those closer in degree to the deceased shall have precedence
and if they are equal in degree, the child of the forced heir shall have precedence over the
child of the cognate. If they are all children of a forced heir or if none is so, then they
shall participate equally in the estate.
2. In the second kind of cognates, those closer in degree to the deceased shall have
precedence and if they are equal in degree, the one from whom descends a forced heir
shall have precedence. In case they are all of equal degree without a forced heir among
their descendants, or all of them have forced heirs descendants, and if all are of paternal
descent or of maternal descent, they shall participate equally and if they are not all of the
same parental descent, two-thirds shall be given to those of paternal descent and one-third
to those of maternal descent.
3. In the third kind of cognates, those closer in degree to the deceased shall have precedence
and if they are equal in degree and among them some are entitled heirs and the others are
cognates, the former shall have precedence over the latter, otherwise the closest relative.
So, those who descend from both parents are preferred to those descending from either
one; those who descend from the father are preferred to those descending from the
mother; and if they are all equal in degree and strength of kinship they shall participate
equally in the estate.
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Article (351)
1. In case all members of the first group of the fourth kind, as stated in Article (349) of this
Law, are of paternal descent; i. e. Maternal uncles of the deceased or his aunts, in the
absolute; or are of maternal descent; i. e. uterine uncles of the deceased or his aunts, in the
absolute, the closest kin shall have precedence. So, the germane shall be preferred to the
consanguine or the uterine and who descends from the father is preferred to the one of
maternal descent. If they are of the same strength of kinship they shall participate equally
in the estate. In case they are of different descents, two-thirds shall be given to those of
paternal kinship and one-third for those of maternal kinship. The share of each group shall
be divided in an aforementioned manner.
The provisions of the preceding paragraph shall apply to the members of the third and
fifth groups.
2. In the second group, the closest degree among them shall have precedence over the more
remote even if he is from a different line of descent. In case of equal degrees and same
descent, the closest shall be preferred, if they are all descendants of an agnate or a
cognate, and if they are different, the agnate shall be preferred to the cognate. In case of
different sides of kinship, two – thirds shall be given to those of paternal descent and onethird
to those of maternal descent. The share of each group shall be divided between them
in an aforementioned manner.
The provisions of the preceding paragraph shall apply to the members of the fourth and
sixth groups.
3. No consideration shall be given in case of multiple kinship of a cognate heir except where
the line of descent is different.
Article (352)
A male heir shall have the share of two females in the inheritance of cognates except the
maternal brothers who shall receive equal shares with the female heirs.
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Chapter IX. Succession by Assumption
Article (353)
The share of the missing person in the succession of his decedent shall be frozen on
the assumption that he is alive, so if he appears alive he shall take it and if he is declared
dead his share shall devolve to his entitled heirs on the date of the judgment.
Article (354)
The conceived child shall be entitled to a share in the succession of his decedent to be
reserved for it. This share shall be the shares of two males or two females, whichever is
larger, on the assumption that the conceived are twins. The rest of the heirs shall receive
the smaller of the two shares. The distribution of the estate shall be adjusted after birth
according to the shares provided for in the law.
Article (355)
Should the share reserved for the conceived child be less than his entitlement, the
difference shall be taken from the heir in whose share this difference accrued. Where the
share reserved is more than its entitlement, the excess shall go to the entitled heir.
Chapter X. Alienation of a Share
Article (356)
1. Alienation is an agreement of the heirs that some of them abandon their share in the
estate, of which they have knowledge, to the other heirs against a specific consideration.
2. Should one of the heirs alienate his share to another, the latter is entitled to this share and
shall replace him in the succession.
3. Where alienation by one of the heirs to the others takes place and if the consideration has
been paid to him from the estate, the shares of the alienator shall be deducted from the
total shares and the shares of the others shall remain unchanged. In case the consideration
is paid from their own funds and the alienation agreement did not provide for the mode of
partitioning of the alienator’s share, it shall be divided among them on pro rata of the
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amount paid by each of them and, if it could not be determined, his share shall be divided
equally between them.
Chapter XI. Miscellaneous Matters
Article (357)
1. Should the deceased, while alive, acknowledge the existence of a kinship relation between
someone and himself, his acknowledgement does not bind the heirs unless it fulfils the
conditions of its validity.
2. In case his acknowledgement concerns someone else and the kinship relation was not
established, in accordance with Article (93) of this Law, and he did not retract his
acknowledgement, the beneficiary thereof shall be entitled to the whole estate of the
acknowledging decedent unless the latter has an heir.
3. If some of the heirs acknowledge to another person the existence of a kinship relation
between the latter and the decedent, the beneficiary of such acknowledgement shall share
exclusively with the acknowledging heir his entitlement in the estate of the decedent
unless he is excluded by him.
Article (358)
The adulterous child shall inherit from his mother and her relatives; his mother and her
relatives shall inherit him; likewise for the incestuous child.
Article (359)
The ambiguous bisexual shall be entitled to half of the two shares considering masculinity
and feminineness.
Article (360)
The vacant estate shall be a mortmain (Wakf) in his name for the poor, the needy and the
students in the Administration of the Public Organization of Wakfs.
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Article (361)
Shall be considered void, every fraud to the provisions governing inheritance by way of
sale, donation, testament or other dispositions.
FINAL PROVISIONS
Article (362)
Each provision violating or contradicting the provision of this Law shall be abrogated.
Article (363)
The present Law shall be published in the Official Gazette and shall come into force as of
the date of its publication.
Promulgated by Us at the
Presidential Palace in Abu Dhabi
On 19th of November 2005
Corresponding to 17 Shawal 1426 H.
Khalifah Bin Zayed Al Nahyan
President of the United Arab Emirates State

Preamble
* Amended by:
Federal Law No. (30) of 2005 dated 30/11/2005
Federal Law No. (10) of 2014 dated 20/11/2014
We, Zayed Bin Sultan Al-Nahyan, the President of the United Arab Emirates State,
Pursuant to the perusal of the provisional* Constitution, and
* The word “provisional” has been deleted from the Constitution of the United
Arab Emirates, wherever mentioned, by virtue of Article (1) of the
Constitutional Amendment No. (1) of 1996 dated 02/12/1996; this Constitution
has become the permanent Constitution of the State.
Federal law No. (1) of 1972 Concerning the Areas of Jurisdiction of the Ministries,
the Jurisdictions of the Ministers and the amended laws thereof, and
Federal law No. (10) of 1973 Concerning the Federal Supreme Court and the
amended laws thereof, and
Federal law No. (11) of 1973 Concerning the Organization of Juridical Relationships
between the Emirates Members in the Union, and
Federal law No. (6) of 1978 Concerning the Foundation of Federal Courts and
Transferring to Them the Areas of Jurisdiction of the Local Juridical Institution in
Some Emirates and the amended laws thereof, and
Federal law No. (17) of 1978 Concerning the Organization of the Appeal’s
Conditions and Proceedings through Cassation before the Federation Supreme Court
and the amended laws thereof, and
Law of Civil Transactions issued by the federal law No. (5) of 1985 and the amended
laws thereof, and
Federal Law No. (11) of 1992 Concerning Issuance of the Civil Procedures Code
Page 2 of 139
On the grounds of what the Minister of Justice has exposed, the consent of the
Cabinet, and the authentication of the Federal Supreme Council,
Have promulgated the following Law:
Article (1)
* As amended by Federal Law No. (30) dated 30/11/2005:
The concomitant law shall be applied concerning the civil procedures before the courts,
and all the laws, regulations, orders, arrangements and the instructions practiced, which
are particular to the civil procedures shall be cancelled. That with the exception of the
validity of the competent authority in the emirate which hasn’t transferred its local
judiciary corps to the federal judiciary through the formation of courts or special
judiciary committees for examining and settling any specific action at law or legal matter
according to its law which is in operation when this law is issued.
Article (2)
This law is to be published in the official gazette, and will be effective three months after
its publication date.
Promulgated by Us
At the Presidential Palace in Abu Dhabi
On 24 February 1992
Corresponding to 21 Shaaban 1412 H.
Zayed Bin Sultan Al Nahyan
President of the United Arab Emirates
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FEDERAL LAW CONCERNING CIVIL PROCEDURES
(UAE CIVIL PROCEDURE CODE)
Introductory Chapter. General Provisions
Article (1)
1. The laws of the procedures are to be applied on the actions which haven’t been settled
and the proceedings which haven’t been executed prior to the date of their
application.
That with the exception of:
a) The amending laws of jurisdictions, when their date of application is after the
action’s shutdown.
b) The amending laws of the dates, when the date comes before acting according to
them.
c) The laws regulating the modes of appeal with regard to the decisions which have
been issued before applying them, when such laws are abrogated or are
constituent to one of these modes.
2. Any procedure which is considered valid under a law in force is to remain valid
unless stipulated otherwise.
3. What is originated as dates shall not entail the failure of the case’s audition,
extinction or other dates of proceedings except from the date of applying the law
which has originated them.
Article (2)
No request or plea from a person shall be accepted unless he has an existent and legal
interest thereof. However, the potential interest shall be sufficient if the purpose of the
request is a precaution to repel a forthcoming danger or to verify a right of which the
evidence can be lost when disputing thereabout.
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Article (3)
1. If the law stipulates an imperative date to take measures occurring by declaration the
date will not be considered unless the declaration is done there within.
2. If the law stipulates that a procedure should be fulfilled by way of deposit, it must be
executed within the date appointed in the law.
Article (4)
The language of courts is Arabic, and the court should hear the statements of the parties,
witnesses or others who have no knowledge of the Arabic language with the help of an
interpreter after he/she has taken an oath, unless he/she did it already before being
employed or before getting the interpretation license.
Article (5)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The notice shall be served upon a party’s request or a court’s order by the process
server or in in any other way prescribed by the Law.
2. The Court may authorise the plaintiff or his attorney to serve the notice.
3. Notice may be served through a company or one or more private offices.
The Cabinet shall issue the notice serving regulation through private companies and
offices as well as the conditions required for the notice serving process to be carried
out according to the provisions hereof.
Every person assigned to be in charge of the notice serving process shall be deemed a
process server.
4. If it is impossible for the process server to serve the notice, the matter shall be
referred to the case management office, the competent judge or the head of circuit,
according to the circumstances, to decide the appropriate modification to be made to
the notice serving method.
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Article (6)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. No notice may be served and no execution procedure may be undertaken by any of
the process server or the executor, before seven o’clock in the morning or after eight
o’clock in the evening, or during the official holidays, except in case of necessity and
under a written permission from the competent judge, the head of circuit or the
magistrate of summary justice.
2. As for the government and the public legal persons, the date of notice serving or
commencement of execution shall be set in accordance with their activities and their
office hours.
Article (7)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
The notice paper shall include the following information:
a) The date of the day, month, year and hour when the notice has been served.
b) The notice applicant’s name, title, profession or job, domicile, elected domicile and
workplace, as well as the name of the applicant’s representative, his title, profession
or job, residence and workplace in case he works for others.
c) The name of the the notified person, his title, profession or position and domicile or
elected domicile. In case his domicile was unknown at the time when the notice was
served, his last domicile and workplace should be specified.
d) The name of the process server, his position, the entity to which he belongs and his
signature on both the original and the copy of the notice paper.
e) The subject of the notice.
f) The name of the person who received the notice, his title, signature, seal or
fingerprint on the original paper as acknowledgment of receipt or for proving his
abstention and the reason thereof.
Article (8)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
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1. The notice paper copy shall be delivered to the addressee wherever found or at his
domicile, residence, elected domicile or workplace. Should it be impossible to serve
him the notice or should he abstain from the receiving such notice, the case
management office shall either serve him the notice or authorise same through
registered mail, fax, email or similar modern technology means specified by virtue of
a decision issued by the Minister of Justice, or by any means agreed upon by the
parties.
2. If the process server was unable to find the addressee neither in his domicile nor in
his residence, he shall deliver the copy of the notice to any of the persons living with
said addressee including spouses, relatives, in-laws or servants. In case the process
server was unable to find the addressee in his workplace, he shall deliver a copy of
the notice to the chairman or to any manager or employee.
3. The process server shall make sure that the person to which the notice is served is at
least 18 years old and that neither such person nor the person represented thereby
have an apparent conflict of interests with the addressee.
4. If the case management office, the competent judge or the head of circuit, as the case
may be, was ascertained that the addressee has no domicile, residence, elected
domicile, workplace, postal address, fax, or email address, or should the parties fail
to agree on the means to serve the notice, it shall be posted on the notice board of the
court or clearly on the door of the last place wherein he used to reside if any, or by
publication in a widespread daily newspaper issued in Arabic in the State and in
another newspaper issued in a foreign language, if needed, should the addressee be a
foreigner. The posting or publication date shall be considered as the notice serving
date.
5. The original notice paper shall be attached to the case file.
Article (9)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
With the exception of the provisions stipulated in special laws, the notice paper copy
shall be delivered as follows:
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1) As for ministries, governmental, federal, local departments and public authorities and
institutions of all kind, the copy shall be delivered to their legal representative.
2) As for private companies, associations and institutions and all other private legal
persons, the copy shall be delivered at their head office, to their legal representative
or whoever acts in his stead. If they are not present, the copy shall be delivered to one
of their office’s employees. In case the aforementioned establishments have no head
office, the copy shall be delivered to their representative personally or at his
domicile. Should it be impossible to serve the notice, the procedure mentioned in
Clause 4 of Article (8) of the present Law shall be applicable.
3) As for foreign companies that have a branch or an office in the State, the copy shall
be delivered to the manager of the company’s branch or office or whoever legally
represents it in the State. In case of his absence, the copy shall be delivered to one of
his office’s employees.
4) As for the members of the armed forces, the police or the like, the copy shall be
delivered to the competent department to deliver it to them.
5) As for prisoners, the copy shall be delivered to the head office of the place where
they are imprisoned in order to serve it to them.
6) As for sailors of commercial vessels and their crews, the copy shall be delivered to
the master in order to serve it to them. If the vessel has left the port, the copy shall be
delivered to the shipping agent.
7) As for persons who have a known domicile abroad, the copy shall be delivered to the
ministry of justice to communicate it to them by diplomatic means, unless the notice
serving methods in such case are regulated under special agreements.
However, notice may be served by any means agreed upon by the parties. In such
case, notice may be served through one or more companies or offices, in accordance
with the controls set by virtue of a Cabinet Decision.
Article (10)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
The notice shall be considered effective according to the following:
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1) From the date of receipt of a copy thereof in accordance with the preceding
provisions.
2) From the date on which the letter is sent by the Ministry of Foreign Affairs or the
Diplomatic Mission to indicate that the addressee has either received a copy of the
notice or abstained from receiving same.
3) From the date of acknowledgment of receipt of the registered mail, fax or email.
4) From the date of posting or publication according to the provisions set forth in the
present Chapter.
Article (11)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. If the law has set, for attendance or for the occurrence of procedures, a duration
counted by days, months or years, the day on which the notice is served or the matter
considered by the law as giving effect to the duration shall not be counted. The
duration shall expire by the end of the office hours of the last day thereof.
2. If the duration was counted by hours, the hour on which the duration commences and
on which it expires should be counted as mentioned.
3. In case the date should expire before the procedure, the procedure should not take
place before the lapse of the last day of the duration.
4. The durations counted by month or year shall expire on the corresponding day of the
following month or year.
5. In all cases, if the end of the duration falls in an official holiday, the duration shall be
extended to the following working day.
6. The durations counted by month or year shall be set according to the Gregorian
calendar where a month consists of 30 days, unless the law stipulates otherwise.
Article (12)
* Abrogated by Federal Law No. (10) of 2014 dated 20/11/2014. The previous text
(as amended by Federal Law No. (30) dated 30/11/2005) reads as follows:
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1. A date of 10-day period is to be added to the dates stipulated in such law for that
whose residence is located out of the court’s area and 90 days to that whose residence
is outside the United Arab Emirates.
2. It is possible, in case of the fluency of transportation and emergency circumstances,
to reduce the distance date with an order from the competent judge or the circuit
manager, in conformity with the cases given, and that should be notified with a
notification paper.
3. Such date shall not be applied in favor of that who shall be personally notified in the
state during his stay therein, but the competent judge or the circuit manager,
according to the case, having examined the action, may give orders to extend the
ordinary dates or consider them extended, on the condition that they shall not, in both
cases, go beyond the date due, if he were notified in his residence abroad.”
Article (13)
The procedure shall be null if the law has stipulated expressly its nullity or if it has been
impaired with a defect or an essential imperfection because of which the procedure
purpose has not been fulfilled.
In case the procedure purpose has been proved, the nullity shall not be decided in spite of
the stipulation thereon.
Article (14)
With the exception of the cases where the nullity is related to the public order:
1) It is not allowed to anyone to adhere to the nullity except the one for whom it was
legislated.
2) And it is not permitted that the party, who caused such nullity, adhere to it.
3) The nullity shall be extinguished in case that the person who has enacted it would
expressly or implicitly disclaim it for his interest.
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Article (15)
It is possible to validate the null procedure even after the adherence to the nullity, on the
condition that such validation shall be fulfilled on the date legally decided for
undertaking the procedure, and if the procedure has not had a date decided in the law, the
court shall fix a convenient date for validating it and the it shall not be considered except
from the date of its validation.
Article (16)
If the proceeding is null and it has the elements of another, the later shall be correct as it
shall be considered the procedure which has all its elements. And if the procedure is null
in one of its sections, only such section will be null.
The nullity of the previous or subsequent procedures to such procedure shall not be
consequential to its nullity unless it is stipulated thereon.
Article (17)
At the sessions, there should be attending with the judge a notary to undertake the
redaction of the report and the signature thereon with the judge, otherwise the work
would be null, and the session’s report shall be considered an official document of what is
recorded therein.
Article (18)
It is not allowed that the declaration agents, the notaries, or any of the judge’s assistants
take up any work that falls within their professions in the cases belonging to them, to
their spouses, relatives or sons-in-law, up till the fourth degree, or otherwise such work
would be null.
Article (19)
1. The provisions of such law are to be applied on all the civil, commercial or personal
status action that are prosecuted before the state courts.
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2. The court of first instance means in such law the court of first degree whether it were
Civil or Sharia.

BOOK ONE. THE PROSECUTION BEFORE THE COURTS
Title One. The Courts’ Areas of Jurisdiction
Chapter I. The Courts’ International Jurisdiction
Article (20)
With the exception of the real actions related to a real estate abroad, the courts shall have
the jurisdiction to examine the actions prosecuted against the citizen and the actions
prosecuted against the foreigner who has residence or domicile in the state.
Article (21)
The courts shall have jurisdiction to examine the actions against the foreigner who has no
residence or domicile in the state in the following cases:
1) If he had an elected domicile.
2) If the action is related to real estates in the state, a citizen’s heritage, or an open estate
therein.
3) If the action is concerned with an obligation concluded, executed, or its execution
was conditioned in the state or related with a contract required to be authenticated
therein or with an incident occurred therein or bankruptcy declared at one of its
courts.
4) If the action has been prosecuted from a wife who has a residence in the state, against
her husband who had a residence therein.
5) If the action is concerned with an alimony of one of the parents or the wife or with a
sequestered or with a minor, or with his relationship or with a custody on fund or on
person, in case that the claimer of the alimony, the wife, the minor or the sequestered
has a residence in the state.
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6) If the action is concerned with the civil status and the plaintiff is a citizen or a
foreigner who has residence in the state, provided that the defendant had not a
determined residence abroad or the national law is imperatively applicable on the
action.
7) If one of the defendant has a residence or domicile in the state.
Article (22)
The courts shall have jurisdiction to settle the primary issues and the interlocutory
requests on the original action falling under its jurisdiction, and they shall also have
jurisdiction to decide on every request related to such actions and which the good course
of justice requires its examination therewith. They shall also have jurisdiction to order
summary and precautionary provisions which shall be executed in the state even if they
were not related to the principal action.
Article (23)
If the defendant hasn’t come and the court has not had the jurisdiction to examine the
action according to the precedent articles, the court shall automatically decide its lack of
jurisdiction.
Article (24)
Any agreement which shall be inconsistent with the articles of this section shall be
considered null.

Chapter II. The Courts’ Specific and Valuable Jurisdiction
Article (25)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
The courts of first instance shall have jurisdiction to hear all civil, commercial,
administrative, labour and personal status lawsuits with the exception of those to which
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the Federation is a party, since such lawsuits shall fall within the jurisdiction of Federal
Courts.
Article (26)
* As amended by Federal Law No. (30) dated 30/11/2005:
With the exception of the provisions of the preceding article’s stipulation, it is possible
that each Emirate forms committees that have their own jurisdiction to examine the
litigations concerned with leases of locations between the lesser and the lessee and it has
the authority to organize provisions for executing the decisions of such committees.
Article (27)
The appellate courts shall have jurisdiction to decide on the appeal cases prosecuted
before them from the judgments delivered from the courts of first instance according to
what is stipulated in the law.
Article (28)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. There shall be appointed, at the location of the court of first instance, one of its
judges to decide temporarily, and with no prejudice to the original right, in the
summary issues, of which there is worry from the expiry of date.
2. The court of merits shall have jurisdiction to examine such issues if they were
prosecuted consequently thereto.
3. As for in the out-sphere of the city, where the court of first instance is located, such
jurisdiction shall belong to the court of summary justice.
Article (29)
The summary judiciary shall have jurisdiction to decide the imposition of a legal
sequestration on movables, real estate, or a set of assets about which a litigation has taken
place or the right thereto has not been settled, in case the person who has the interest
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would have plausible reasons according to which he would apprehend an urgent risk that
the property would remain under his possessing hand.
Article (30)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The minor circuits formed by a single judge shall issue first instance judgments in the
following matters:
a) The civil, commercial and labour actions whose value does not exceed AED
500,000 and counterclaims whatever was their value;
b) Personal status actions, actions for division of common property and the actions
related to the claim and specification of wages and salaries whatever was their
value.
In all cases, the minor circuits’ judgments shall be final if the lawsuit’s value
does not exceed AED 20,000.
2. The major circuits formed of three judges shall have jurisdiction over the following:
a) Deciding upon all civil, commercial and labour actions which do not fall within
the jurisdiction of the minor circuits;
b) Administrative and real estate actions, whether original or accessory, whatever
was their value;
c) Deciding upon temporary or summary claims and all other counterclaims as well
as the claims related to the original request, whatever was their value or type;
d) Bankruptcy and preventive composition lawsuits;
e) Lawsuits that fall within their jurisdiction as per the law.

Chapter III. The Courts’ Local Jurisdiction
Article (31)
1. The court, in which area the defendant’s residence exists, should have the jurisdiction
unless the law stipulates otherwise, in case he had not a residence in the state, the
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jurisdiction should be given to the court in which area his residence or his workplace
exists.
2. It is possible to prosecute the action to the court in which area the prejudice has taken
place, and that is to be in case of the actions of indemnity for the occurrence of
damage on a person or a property.
3. The jurisdiction should be in the commercial matters of the court in which circuit the
prosecuted residence exists or be given to the court in which circuit the agreement
has been concluded, totally or partially executed or to the court in which circuit the
agreement should be executed.
4. If there are more than one prosecuted, the jurisdiction should be at the court in which
circuit the residence of one of them exists.
5. In other than the cases stipulated in the Article (32) and the Articles from (34) to
(39), it is possible to agree on the jurisdiction of a certain court to examine the
litigation, and in such case the jurisdiction will be given to such court or the court in
which circuit the prosecuted residence, domicile or workplace exists.
Article (32)
1. In the real estate actions and the possession actions, the jurisdiction should be given
to the court in which circuit the real property, or one of its parts in case it exists in
more than one court’s circuit.
2. In the personal real estate actions the jurisdiction should be given to the courts in
which circuit the real property or the residence of the prosecuted exists.
Article (33)
In the actions related to existing or liquidated companies or societies, or private
foundations the jurisdiction should be given to the court in which circuit its
administration center exists, and it is possible to take legal action to the court in which
circuit the branch of the company, association, or foundation exists and that is concerning
matters related to such branch.
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Article (34)
The actions concerned with inheritances which are prosecuted prior to the division from
the estate creditor or from some heirs against each other should be of the jurisdiction of
the court of which circuit the residence of the deceased exists.
Article (35)
1. The actions concerned with commercial bankruptcy should be of the jurisdiction of
the court in which circuit the bankrupted commercial store exists, and in case it had
many commercial stores, the court of the store which was used as a main center to its
commercial activities should have the jurisdiction.
2. If the tradesman retired from the trade, the actions should be brought before the court
to which the residence of the prosecuted belongs.
3. As for the actions of bankruptcy, it should be prosecuted before the court which
adjudged ( sentenced ) the declaration of the bankruptcy.
Article (36)
The jurisdiction in the litigations related to supplies and contracting works and the lease
of houses and wages of workmen and artisans and wageworkers should be given to the
court of the residence of the prosecuted or to the court in which circuit the agreement has
been concluded or executed.
Article (37)
In the litigation related to the claim of the insurance value, the jurisdiction should be
given to the court in which circuit the residence of the beneficiary or the location of the
insured property.
Article (38)
1. In the actions including a demand for undertaking a temporary or summary provision,
the jurisdiction should be given to the authorized court of first instance in which
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Page 17 of 139
circuit the residence of the prosecuted exists or the court in which circuit the
provision is required to take place.
2. In the summary litigations related to the execution of decisions and legal instruments
the jurisdiction should be given to the court in which circuit the execution will take
place.
Article (39)
The court which examines the principal action has jurisdiction to decide in the
interlocutory requests, provided that the prosecuted, in the guarantee request, may adhere
to the court’s lack of jurisdiction if the principal action proved to be prosecuted merely
for the purpose of bringing him before a court other than his authorized court.
Article (40)
If the prosecuted had no residence or address in the state and it was not feasible to
determine the authorized court in accordance with the previously mentioned decisions the
jurisdiction should belong to the court in which circuit the prosecutor’s residence exists,
and if the prosecutor had no residence or address in the state the jurisdiction should
belong to the capital court.
Article (41)
In the commitments in which there has been an agreement on a chosen residence for its
execution, the jurisdiction should be to the court in which circuit the residence of the
prosecuted exists or the chosen residence for the execution.

Title Two. Action Prosecution, Registry and Valuation
Chapter I. Action Prosecution and Registry
Article (42)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
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1. Lawsuits shall be filed to the court according to the plaintiffs’ request by submitting
the statements of claims to the case management office or by creating electronic
records for such lawsuits.
2. The statement of claim shall include the following details:
a) The plaintiff’s name, title, ID number (if any), profession or job, domicile,
workplace, phone number, as well as his representative’s name, title, profession
or job, domicile, residence, postal address, fax number or email address. If the
plaintiff has no domicile in the State he shall elect one.
b) The defendant’s name, title, ID number (if any), profession or job, domicile or
elected domicile, residence, workplace, phone number, as well as his
representative’s name, title, profession or job, domicile and workplace if he
works for others. However, in case neither the defendant nor his representative
have a known domicile or workplace, the last domicile, residence or workplace
and postal address, fax number or email thereof shall be mentioned.
c) The subject-matter of the lawsuit, requests and grounds thereof.
d) The date of submission of the lawsuit to the case management office.
e) The court before which the lawsuit is filed.
f) Signature of the plaintiff or his representative.
Article (42-bis)
* Added by Federal Law No. (10) of 2014 dated 20/11/2014:
1. By virtue of a decision issued by the Minister of Justice or the chairman of the local
judicial authority, each within the competence thereof, an office called “Case
Management Office” shall be established at the headquarters of the competent court.
The decision shall specify the working system of the Office.
2. The case management office shall be formed of a chairman and a sufficient number
of the court’s employees including those working in the legal field or others, under
the supervision of the chairman of the competent court.
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3. The case management office shall be in charge of preparing and managing cases,
including registering the cases, serving notices, and exchanging memorandums,
documents and expertise reports among the disputing parties.
4. The competent judge may impose a fine upon the defaulting party as specified in
Article (71) of the present Law.
5. Should the lawsuit involve a preliminary motion filed by any of the disputing parties,
an urgent request or a request of joinder of a party against whom the lawsuit was not
filed, or should the defendant fail to appear after being summoned in person or the
litigation proceedings be interrupted ipso jure by the death of one of the disputing
parties or by their loss of capacity to sue or be sued or by the loss of capacity of the
attorney who was undertaking the proceedings before the referral of the case, the case
management office shall refer the case to the competent judge after setting a date for
a session to settle all the aforementioned matters. The judge may return the case to
the case management office to complete the case preparation procedures according to
the circumstances.
Article (43)
1. The date of appearance before the court shall be ten days and it shall be possible, in
case of necessity, to reduce this date to three days.
2. The date fixed for the presence in the summary actions shall be twenty four hours,
and it shall be possible, in case of necessity, to reduce this date setting it from an hour
to an hour on the condition that the notification is to be made to the litigant party
himself, unless the action were of the nautical actions.
3. Reducing the dates in the mentioned circumstances should be done with the
permission of the court’s president or the judge of the summary cases, according to
the circumstances, and the party shall be notified with its copy and with the action’s
initiatory pleading.
4. The nullity shall not be based on the negligence of the attendance dates, and that
without prejudice to the notified person’s right to the postponement in order to
complete the date.
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Article (44)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. After collecting the fees, the case management office shall register the case in the
relevant register, provided that the registration date is written down in said register,
and in the presence of the plaintiff or his representative the date of the session set for
hearing the case shall be written down on the original and copies of the statement of
claim. The plaintiff, or his representative, shall sign to indicate that he was notified of
the session.
2. The action shall be deemed filed and effective from the date of its registration.
Article (45)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The plaintiff shall, upon the submission of the statement of claim, submit a number
of copies thereof that shall be equal to the number of defendants. A copy to the case
management office shall be kept in a special file. Moreover, the plaintiff shall submit,
with the statement of claim, copies of all the documents that support his lawsuit, in
addition to any expertise reports, if any, prepared by registered experts.
2. The defendant shall submit a defense memorandum and copies of the relevant
documents that shall be signed by said defendant, according to the dates set in the
present Law.
3. Upon disagreement on the validity of the documents’ copies, the court shall set the
closest session possible for the submission of their originals.
4. The translated documents shall be legally certified if written in a foreign language.
Article (46)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The case management office shall, at most on the day following the date of
registration of the statement of claim, deliver a copy thereof, with the copies, papers
and documents attached, to the authority in charge of serving notice of said
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statement, in order for the notice serving procedure to be carried out in accordance
with the form prepared for that purpose. The original notice document shall be
returned to the Case Management Office.
2. The notice of the statement of claim shall be served within ten days at most from the
date of its delivery to the process server. If a session, falling within such date, is set
for heating the case, the notice shall be served before the session.
3. The failure to comply with the time-limit set in the preceding paragraphs shall not
result in nullity.
Article (47)
* Abrogated by Federal Law No. (10) of 2014 dated 20/11/2014. The previous text
reads as follows:
“If the prosecutor and the prosecuted had voluntarily appeared before the court and
brought thereto a litigation, the court may hear the action at once and decide, if possible,
therein, otherwise it shall appoint another session there for, and the court’s notary should
accomplish the procedures of its registry in the schedule and the juridical procedures
shall be directly concluded in the session’s minutes.”

Chapter II. Assessment of the Case Value
Article (48)
* As amended by Federal Law No. (30) dated 30/11/2005:
The action’s fee shall be valued on the day of its prosecution, and in all cases, the
valuation should be on the basis of the opposing parties’ last requests, and the action’s
valuation should include what is due, on the day of its prosecution, of indemnities,
revenue, expenditures and other valued attachments. However, in all cases, the building
and plant’s value should be considered, in case its removal is required.
Article (49)
* As amended by Federal Law No. (30) dated 30/11/2005:
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1. If the value has not been mentioned in cash, and it was possible to value it in cash,
the valuation shall be undertaken by the court.
2. If the prosecuted matter were an amount of money in a currency other than the
United Arabic Emirates’, the action’s value shall be estimated with what is equivalent
to such amount in the state’s currency.
3. The actions concerning the ownership of real estates shall be evaluated with the real
estate’s value and the action related to the movable shall be evaluated with its value.
4. If the action is related to a request for a contract’s validity, nullification, or breach,
the action shall be evaluated with the value of what’s contracted thereon. As for the
contracts of exchange, the action is to be evaluated with the value of the higher of
both exchanged parts.
5. If the action were prosecuted for a request for a permanent contact’s validity,
nullification or termination — the valuation shall be considering the total of the
monetary equivalent of the entire contract’s duration, so if the mentioned contract has
been executed in a part thereof, the action of its termination should be evaluated by
the consideration of the remaining period.
6. The action of evacuating the premises shall be evaluated with the annual rental.
7. If the action is between a creditor and debtor concerning the seizure – or an auxiliary
real right, the value thereof shall be evaluated with the debt’s value or with the value
of the property confiscated or the real right, whichever shall be less. As for the action
prosecuted by the other for the payability of such property, it shall be evaluated by
the consideration to its value.
8. If the actions included requests which have resulted from one legal reason, the
valuation shall be by the consideration of its value in bulk, and if the requests have
been issued from different legal reasons, the valuation shall be by the consideration
the value of each reason separately.
9. If the action is related to a request that is not estimable with the mentioned terms,
their value shall be considered exceeding a Hundred Thousand Dirham.

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Title Three. The Litigants Appearance and Absence and Litigation Proxy
Chapter I. The Litigants Appearance and Absence
Article (50)
On the day fixed for examining the action, the opposing parties shall appear (attend) by
themselves or whoever they brief (authorize / appoint / delegate).
Article (51)
* As amended by Federal Law No. (30) dated 30/11/2005:
If neither the plaintiff nor the defendant has attended, the court shall decide in the action,
if it is valid to decide therein, or otherwise it would decide its cancellation, and if sixty
days have passed and none of the parties requested the action’s progression or none of the
parties has attended after progressing therein, it shall be considered as null.
And the court shall decide in the action if the plaintiff, the plaintiffs, or some of them
were absent at the first session and the defendant appeared (attended) thereat (therein).
Article (52)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. If the defendant, failed to appear at the first session and he has been personally
notified with the action declaration, the court shall decide in the action, and if he
were not notified in person, the court should, in other cases than the summary
actions, postpone the examination of the case to a following session of which the
plaintiff will notify the absent party, and the decision in the action, in both cases,
shall be considered a decision in the presence of the parties.
2. In case the defendants were many and some of them have been declared in person
and others have not, and they all have failed to attend at the first session or to submit
a brief with the defense, or those who have not been notified in person failed to
appear, the court, in other cases than the summary actions, should postpone the
examination of the action to a following session which the plaintiff shall notify the
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absentees who have not been notified in person, and the decision in the action shall
be considered in the presence of the parties to the advantage of all defendants.
3. In case of applying the rules of this clause, notifying the legal person, public or
private, at his location or his administration center shall be considered a personal
notification.
Article (53)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. Should the defendant alone fail to appear at the first session while he has been
notified in person of the initiatory pleading, the court shall decide the case If he has
not been notified in person, the court, in other than summary cases, may adjourn the
examination of the case to a following session of which the defendant shall notify his
absent opponent and the judgment, in both cases, shall be considered as if rendered in
the presence of the parties.
2. In case there are more than one defendant and some of them have been notified in
person while the others have not been so notified, and all of them failed to appear at
the first session, or did not submit a brief of their defense, or only those who have not
been notified in person have absented themselves, the court has, in other than the
summary cases, to adjourn the examination of the case to a following session of
which the plaintiff shall notify the absentees defendants who have not been notified
in person and the judgment shall be considered as if rendered in the presence of all
defendants.
3. In the implementation of the provisions of this Article, the notification of the juristic
person, public or private, at its seat or administration center, shall be deemed to be
served in person.
Article (54)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. If the court finds, upon the absence of the defendant, that he was invalidly served
notice of the statement of claim, it shall postpone the hearing of the case to a
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following session and the defendant shall be properly served notice of the statement
of claim.
2. If the court finds, upon the absence of the plaintiff, that the latter was not duly
notified of the session, it shall postpone the hearing of the case to a following session
on which a notice shall be properly served to said plaintiff.
Article (54-bis)
* Added by Federal Law No. (10) of 2014 dated 20/11/2014:
A party who is served a notice of the claim, shall follow up the postponements, session
dates and procedures related to the case, and the court decisions issued after the
commencement of the litigation procedures shall be deemed effective without the need
for serving any notice.

Chapter II. The Litigation Proxy
Article (55)
1. The court shall accept from the parties whoever they shall appoint as proxy according
to the law.
2. The proxy must establish his appointment as proxy for his client by an official
document.
3. The proxy may be done through a declaration recorded in the session’s minutes.
Article (56)
1. Where a proxy is issued by one of the parties to the litigation, the domicile of the
proxy shall be considered for notification purposes of all papers required for
proceeding with the case at the degree of litigation to which he is appointed as proxy.
The party who has no proxy in the country where the tribunal’s venue is located, has
to elect a domicile therein.
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2. The attorney’s resignation or dismissal shall not prevent the progress of the
procedures in his presence unless the other party is notified of the replacement or of
the decision of the principal to proceed with the case by himself.
3. The attorney may not resign his mandate at an inconvenient time and without
permission from the court.
Article (57)
The litigation proxy empowers the attorney with the authority to perform the necessary
acts and procedures in order to file the legal action, follow it up, defend and to take
precautionary measures until the decision on its merits is rendered, in the degree of
prosecution to which he was entrusted, and to notify such decision, without prejudice to
the matters to which the law requires a special authorization.
Article (58)
1. All that the attorney decides at the session in the presence of his principal shall be
equivalent to what the principal himself would decide unless he has disclaimed it
during the examination of the case at the same session.
2. It is not valid, without a special authorization, the declaration of the right prosecuted,
disclaiming it, reconciliation or arbitration therein, approving the oath, or directing or
repulsing it, releasing the litigation, giving up the judgment entirely or partially,
relinquishing one of the channels of appeal therein, releasing the attachment
(seizure), relinquishing the insurances with the continuation of the debt, claiming the
falsification, recusing the judge or the expert or the real petition, or accepting it, or
any other disposition that the law requires therein a special authorization.
Article (59)
It shall not be possible neither to one of the judges nor to the attorney general nor to any
member of the prosecution nor to any of the courts’ employees to be an attorney for the
litigant parties, in the attendance or in the prosecution, whether verbally or in writing,
even if the action were submitted before a court other than the one he belongs to,
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otherwise the work shall be null. However, that shall be possible to them with the persons
whom they legally represent, their spouses, their ancestors and their descendants up to the
second degree.

Title Four. The Intervention of the Public Prosecution
Article (60)
The public prosecution may prosecute the action in the circumstances which the law
stipulates, and it shall have in such circumstances the same rights which the litigant
parties have.
Article (61)
With the exception of the summary actions, the public prosecution should intervene in the
following circumstances, otherwise the decision shall be null:
1) The actions which it has been allowed to prosecute by itself.
2) The appeals and the requests submitted before the supreme federal court, with the
exception of the appeals of cassation in the civil matters.
3) The actions related to the incapacitated, those whose capacity is defective, the
absentees and the missing persons.
4) The actions related to the charitable endowments, donations, wills devoted to
benefaction.
5) The actions for the recusals of judges and the prosecution members and for litigating
them.
6) Any other circumstance in which the law stipulates the necessity of the public
prosecution intervention.
Article (62)
Except the summary actions, the public prosecution may intervene in the following
circumstances:
1) Absence of jurisdiction for lack of the judicial body’s rule.
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2) The reconciliation which is preventive from the commercial bankruptcy.
3) The actions which it shall consider intervening therein because they are related to the
public order and morals.
4) Any other case which the law stipulates that it may intervene therein.
Article (63)
The court, in any of the action’s circumstances, may order to forward the case’s file to the
public prosecution if a matter related to the public order or morals has been exposed
therein, and the intervention of the public prosecution in such case shall be obligatory.
Article (64)
1. The public prosecution shall be considered representative in the action when it
submits a pleading with its opinion therein and it shall not be bound to attend unless
the law stipulates that.
2. And in all circumstances, the public prosecution shall not be bound to attend the
judgment’s delivery.
Article (65)
In all the cases in which the law stipulates the intervention of the public prosecution, the
case management office* of the court should inform the prosecution in writing as soon as
the action has been recorded, and if a matter, in which the prosecution intervenes, has
been submitted during the examination of the action, the notification thereof should be on
the basis of the court’s order.
* The expression “case management office” has replaced the expression “clerk’s
office”, wherever mentioned, by virtue of Article (1) of the Federal Law No. (10) of
2014 dated 20/11/2014.
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Article (66)
The public prosecution shall accord, on the basis of a request submitted thereto, a period
of seven days, at least, for submitting a brief with its opinion, and such period shall
commence from the day on which the case’s file has been sent thereto.
Article (67)
The intervention of the public prosecution shall be in any circumstance which the action
has been in before closing the pleading therein.
Article (68)
In all the actions in which the public prosecution is a joined party, the litigant parties,
after the prosecution has given its opinion, may not request the speech nor submit new
pleadings, however, they shall be allowed to submit to the court a written statement in
order to amend the facts which the prosecution has mentioned, nevertheless, the court, in
the exceptional circumstances in which it shall decide to accept new documents and
complimentary briefs, may permit their submission and rehearing the pleading, and the
prosecution shall be the last to speak.
Article (69)
The public prosecution may appeal the decision in the circumstances in which the law
binds or allows it to intervene if the decision has contradicted one of the rules of the
public order or if the law stipulated that.
Title Five. The Session Procedures and Its Regularity
Chapter I. Procedures
Article (70)
* As amended by Federal Law No. (30) dated 30/11/2005:
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The pleading shall be proceeded at the first session, and if the prosecutor or the
prosecuted has submitted at such session a document which he could have submitted in
the date determined in Article (45), the court shall accept it if the examination of the
action would not be postponed as a result thereof, but if accepting the documents has
resulted in the postponement of the action, the court shall have, automatically or
according to the litigant parties’ request, to inflict on him a penalty of not less than Two
Thousand Dirham and not more than Five Thousand Dirham.
However, each of the prosecutor and the prosecuted shall be allowed to submit
documents responding to his party’s defense or interlocutory requests.
Article (71)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The court shall impose upon every employee thereof or disputing party who fails to
submit the relevant documents or to perform any of the lawsuit’s procedures on the
date set by said court or by the case management office, a fine of no less than AED
1,000 and no more than AED 10,000, by virtue of a decision that shall be registered
in the session’s minutes. Said decision shall have the same binding force as the
judgments, and may not be contested by any method whatsoever.
2. The court may exempt the convict from all or part of the fine should the latter
provide an acceptable excuse, and the court may, unless the defendant objects, decide
the interruption of the case proceedings for a period not exceeding three months
instead of imposing the fine on the plaintiff.
3. If the interruption period lapses without that the prosecutor requests the continuation
of proceedings within the thirty days following the end of said period or should the
court’s decisions not be executed, the court shall rule that the case shall be considered
as void ab initio.
Article (72)
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It shall be possible to execute the penalty’s decision issued according to the rules of
Articles (70), (71) by the court which has issued it after notifying the convicted if he
hasn’t been present at the session.
Article (73)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The court may allow the disputing parties, during the course of the case proceedings,
to submit documents, pleas or new evidence, or to amend their requests, or submit
counter-claims that they were unable to submit to the case management office. The
court may decide not to allow such submission should it realize that such documents
could have been submitted to the case management office, and the memorandums of
the disputing parties shall be served by submission to the case management office or
by exchange provided that the concerned disputing party indicates same on the
original copy of the relevant memorandum.
2. The court may sua sponte ask the disputing parties to provide explanations for any
deficiency found in the lawsuit or its documents.
3. The court may, upon setting a date for adjudication, allow the exchange of closing
arguments on the dates set thereby.
Article (74)
The court may propose the reconciliation and may order, for that reason, the presence of
the litigant parties in person, so if the reconciliation has been accomplished it shall be
recorded in the sessions’ minutes or their agreement shall be attached to the minutes and,
in all circumstances, it shall be signed, by both parties, the judge and the secretary, and
the minutes shall be considered in the power of a document which is due of execution.
Article (75)
The court may not postpone the action more than once for one reason referring to one of
the litigant parties unless for an approved excuse, on the condition that the postponement
period shall not exceed two weeks.
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Chapter II. The Session Regularity
Article (76)
The pleading shall be public unless the court would, automatically or according to the
request of one of the litigant parties, prefer to proceed in it secretly observing the public
order or with consideration to the morals or the respect of the family.
Article (77)
The court may get help from an interpreter appointed or licensed by the Ministry of
Justice or the competent authority and it may also get help from an interpreter from
another source if it finds it necessary.
Article (78)
1. The litigant parties shall be called at the appointed time of the trial.
2. The prosecutor has the right to start the action unless the prosecuted has admitted the
matter exposed in the initiatory pleading and claimed that there have been legal
reasons or auxiliary facts inciting the prosecutor’s action, and in that case, the
prosecuted shall have the right to start the action.
3. a) The litigant party who has the right to start the action may display his claim and
present his evidence to prove it and the other litigant party may, after that, display his
defense and present his evidence to prove it.
b) The litigant party who has started the action may bring forward his evidence to
refute the other party’s evidence.
d) The court shall hear the litigant parties’ pleading and the prosecuted shall be the
last to speak.
4. The court may question the litigant parties and hear the testimony of those it would
consider necessary to hear their testimony.
Article (79)
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The litigant parties may ask the court, in any of the action’s circumstances, to register
what they have agreed on in the session minutes on which they or their authorized
attorneys should sign, and if they have written what they agreed on, the written
agreement shall be attached to the session minutes and its content shall be recorded
therein. The session minutes shall have, in both cases, the power of the executive
document and its copy shall be given in accordance with the established regulations of
delivering the decisions copies.
Article (80)
* As amended by Federal Law No. (30) dated 30/11/2005:
Controlling and administrating the session shall be entrusted to its president, and with
regard to the rules of the legal profession. The president, in order to fulfill that, should
expel from the session hall whoever breaches its order, and if he hasn’t obeyed the court
may immediately decide to detent him twenty four hours or inflict on him a fine of not
less than One Thousand Dirham and not more than Three Thousand, and its decision
therein shall be final.
The court may, before the conclusion of the session, retract from the decision which it
has issued on the basis of the preceding clause.
Article (81)
The court may automatically order the erasure of the offensive expressions or those
which breach the public order or the morals from any of the pleading or procedure’s
papers.
Article (82)
With the observance of the rules of the legal profession, the session president shall order
the writing of a report on each crime occurring during its meeting and what measures he
would consider to take for the investigation procedures, and he shall give orders to
forward the papers to the public prosecution in order to proceed in what should be done
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about them, and he may, if necessary, give orders to arrest the person by whom the crime
has been committed.
Article (83)
Observing the rules of legal profession, the court may take legal actions against whoever
would commit during the session any offense against its stature, against anyone of its
members or anyone of those who work therein and shall immediately inflict on him the
punishment.
The court may also give order to arrest whoever bears a false witness and relegate him to
the public prosecution.
The court’s decision, in such circumstances, shall become effective even if an appeal
against it has occurred.

Title Six. The Pleas, Insertion, Intervention, and Interlocutory Requests
Chapter I. The Pleas
Article (84)
1. The plea to local jurisdiction and the plea to forward the action to another court for
setting the same litigation there before, or for engagement, and the refutation of
nullity which is not related to the public order, and all of the pleas related to the
discontinuing procedures, should be revealed together before presenting any other
procedural plea, request, defense in the action, or disapproval, otherwise the right of
what hasn’t been revealed thereof shall be extinguished, and also the right of the
appellant shall be extinguished in such pleas if he hasn’t revealed them in the appeal
initiatory pleading.
2. It shall be imperative to exhibit together all the aspects on which the plea, related to
the procedures which are not connected to the public order, shall be based, otherwise
the right to what hasn’t been revealed thereof shall be extinguished.
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Article (84-bis)
* Added by Federal Law No. (10) of 2014 dated 20/11/2014:
1. Lawsuits for annulment of administrative decisions shall not be accepted after the
lapse of 60 days from the date of publication of the contested administrative decision
or the date on which the concerned party is notified of said decision or the date on
which said party is proved to have admittedly been informed thereof.
2. The above-mentioned time-limit shall be interrupted when a grievance is submitted to
the administrative entity that issued the decision or a superior entity, and such
grievance shall be decided upon within 60 days from the dated of submission thereof.
If the administrative entity decides to reject the grievance, it decision shall be
justified, and if 60 days lapse from the date of submission of the grievance without a
reply from the competent authorities, the grievance shall be deemed rejected. The
time-limit for filing the lawsuit shall be counted starting from the date of explicit or
implicit rejection as the case may be.
Article (85)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. The plea against the court’s jurisdiction for lack of its authority or because of the
action’s type, or its value may be exhibited in any of the action’s circumstances, and
the court shall automatically decide it.
2. If the court has judged its lack of jurisdiction it should give orders to forward the
action, as is, to the authorized court, and the court’s case management office should
notify the litigant parties with the decision.
Article (86)
If the litigant parties have agreed on the prosecution before a court other than the court
before which the action has been brought, the court may decide to forward the action to
the court which they have agreed on.
Article (87)
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If the litigation have been brought before two courts the plea should be exhibited by
forwarding it to the court before which the last litigation has been brought for deciding
thereon.
Article (88)
It shall be possible to exhibit the plea by forwarding for the engagement before one of the
two courts, and the court to which the action has been forwarded shall be committed to
examine it.
Article (89)
1. As long as the court has decided in the cases presented there before by forwarding, it
may appoint for the litigant parties the session at which they should appear before the
court to which the action has been forwarded, and the clerks’ office should notify the
absentees from the parties thereof.
2. If the court hasn’t appointed a session for the litigant parties, the court to which the
action has been forwarded should appoint it and notify the parties thereof.
3. The court to which the action has been forwarded shall be committed to examine it
unless it was not adherently or qualitatively authorized to examine it.
Article (90)
The nullity of the notification of the actions’ declaration and the summoning papers as a
result of a defect in such notification in the court’s statement, or in the date of the session,
shall be extinguished by the appearance of the notified persons at the session appointed in
such notification or by depositing a brief with his defense, and that without prejudice to
his right to the postponement for the completion of the time-limit of attendance.
Article (91)
1. The plea for the rejection of the action may be presented in any of the action’s
circumstances.
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2. If the court has found that the plea to reject the action for lack of the prosecuted
capacity was based on valid grounds, it shall postpone the action in order to notify
the one who has the capacity according to the prosecutor’s request.
3. If the action has been prosecuted against a governmental authority or a public legal
person, the amendment effect shall extend to the day of prosecuting the action even if
the amendment has taken place after the date decided for its prosecution.
Article (92)
The plea against the illegality of examining the action because of a prior decision therein
may be manifested in any of the action’s circumstances, and the court shall automatically
decide therein.
Article (93)
The court shall decide in the pleas independently unless it has ordered to merge them into
the matter, by then, the court shall expose what it has decided in both the plea and the
matter.

Chapter II. The Insertion and the Intervention
Article (94)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
A disputing party may join in the lawsuit any party against whom claims could validly be
brought upon the filing of said lawsuit. The defendant may, should he/she claim having
the right to recourse, as to the claimed right, against a person who is not a party to the
lawsuit, submit a written request to the case management office or to the court, to explain
the substance and grounds of the claim and request the joinder of such person as a party
to the lawsuit, according to the usual lawsuit filing procedures. Moreover, the defendant
may attend the session if the person required to be joined attends and agrees on such
procedure before the court.
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Article (95)
Everyone who has interest may intervene in the action joining one of the opposing parties
or asking the judgment for himself with a request related to the action, and that shall be
through the usual procedures of the action’s prosecution, or with a request presented
verbally at the session in the presence of the litigant parties and shall be recorded in its
minutes, and the intervention shall not be accepted after closing the pleading.
Article (96)
1. The court may automatically decide the inclusion of anyone whose inclusion it would
consider to be beneficiary to the justice or bring to light the truth, and the court shall
appoint the session of which he shall be notified, and it shall also determine his
position in the litigation giving orders to notify him for such a session, and that shall
be through the usual procedures of the action’s prosecution.
2. The court may charge the case management office to notify, with a sufficient
synopsis of the litigant parties’ requests in the action, anyone whose notification it
considers to be beneficiary to the justice or shall bring to light the truth.
Chapter III. The Interlocutory Requests
Article (97)
1. The prosecutor and the prosecuted may submit any of the interlocutory requests
which are relevant to the original request in a way that shall help the progression of
justice if both shall be examined together.
2. Such requests shall be submitted to the court through the usual procedures of the
action’s prosecution, or with a request presented verbally at the session, in the
presence of the litigant party, and shall be recorded in its minutes.
Article (98)
The prosecutor may submit any of the interlocutory requests:
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1) Which include the amendment of the original request or the amendment of its facts in
order to cope with the circumstances which have emerged or have been observed
after the action’s prosecution.
2) Which are complementary to the original request, consequent, or indivisibly
connected thereto.
3) Which include addition or change to the reason of the action provided that the
request’s facts shall remain as they are.
4) Requesting an order with a precautionary procedure.
5) Which the court shall allow to be submitted and connected to the original request.
Article (99)
The prosecuted may submit any of the interlocutory requests:
1) Which ask for the judicial compensation and the decision in his behalf for the amends
of damage occurred to him from the principal action or from a procedure therein.
2) Any request to which response all or some of the prosecutor’s requests shall not be
fulfilled, or shall be decided for him but bound with a restriction which shall be
beneficiary to the prosecuted.
3) Any request which is indivisibly connected to the original request.
4) Whatever the court shall allow to be submitted and is connected to the principal
action.
Article (100)
1. The Interlocutory requests shall not be accepted after closing the defense.
2. The court shall decide on the requests mentioned with the principal request as long as
it is possible or, otherwise, it shall retain the interlocutory request to decide thereon
after verifying it.

Title Seven. Cessation of the Litigation, the Severance of Its Progress, Its
Extinguishment, Its Prescription and Its Relinquishment
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Chapter I. Cessation of the Litigation
Article (101)
1. The action may be ceased if the litigant parties has agreed on the discontinuation of
the progression therein for a period of six months, maximum, from the date of the
court’s statement of their agreement, and such cessation shall not have influence on
any determined time-limit which the law had appointed for some procedure.
It shall not be legal to any of the two litigant parties to urge the action during such
time-limit except with the consent of his litigant party.
2. If no one of the litigant parties has urged the action during the eight days following
the termination of the period, the prosecutor shall be considered relinquishing his
action and the appellant relinquishing his appeal.
Article (102)
The court shall give order to cease the action if it sees better to suspend the decision in its
merits than to arbitrate in another matter on which the decision would depend, and as
soon as the reason for the cessation has extinguished, any of the litigant parties may urge
the action.
Chapter II. The Severance of the Litigation’s Progress
Article (103)
1. The litigation’s progress shall be severed by the law’s decision by the death of one of
the litigant parties or because of his legal incapacity of the litigation or the incapacity
of any of the attorneys proceeding the litigation for him, unless any of such things
have occurred after closing the pleading in the action, and if there were many litigant
parties the court shall decide considering the litigation severed with regard to the one
by whom the severance reason has occurred and it shall postpone its examination
with regard to the others.
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2. The litigation shall not be severed by the decease of the action’s attorney nor by the
expiry of his proxy through retirement or dismissal, and the court may allow a
convenient time-limit to the litigant, whose attorney has deceased or terminated his
proxy, in order that he would appoint another attorney if he wants.
3. The severance of the litigation shall have as a consequent the cessation of all the
dates of the procedures which have been running to the advantage of the litigant by
whom the reason of the severance has taken place, and the nullity of all the
procedures which occur during the severance.
Article (104)
The action shall continue its progress in regard to the litigant party by whom the reason
of the severance has occurred, and that by charging for attendance the person who takes
the place of the deceased, or the place of the one whose capacity for the litigation has
been lost or the place of that whose capacity has extinguished, on the grounds of the other
opposing party’s request, or with an assignment declared to such party on the grounds of
the request of those. Likewise, the action shall appeal its progress if the heirs of the
deceased or those who have taken the place of the one who lost the litigation capacity or
the place of the one whose capacity has extinguished and undertook its progress.
Article (105)
If one of the severance reasons has occurred after closing the defense in the action the
court may decide therein according to the final statements and requests or may open the
pleading on the grounds of the request of that who took the place of the deceased, the
place of the one who lost the litigation capacity or the place of the one whose capacity
has extinguished or on the basis of the other opposing party’s request.

Chapter III. The Litigation Extinguishment by Prescription and Its Relinquishment
Article (106)
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1. Each one of the litigant parties who have interest, in case of the failure to progress in
the action because of the prosecutor’s action or because of his abstention, may request
the decision for the litigation extinguishment when six months have passed since the
last valid procedure of the judiciary procedures.
2. The period of the litigation extinguishment shall not start in the cases of severance
except from the day in which the person, who requested the decision for the litigation
extinguishment, has notified the heirs of his deceased party or the one who
substituted that who had lost his capacity for the litigation, or substituted that whose
capacity has extinguished, with the existence of the action between him and his
principal litigant party.
3. The decided period for the litigation extinguishment shall be applied in favor of
everybody, even if they were lacking the capacity or deficient thereof, and that shall
not breach their right to claim indemnity from their agents for their negligence in
following up the action, the thing that has resulted in its extinguishment.
Article (107)
1. The request for the decision of the litigation extinguishment shall be submitted to the
court before which the action for the litigation extinguishment has been prosecuted.
2. It shall be possible to insist on the litigation extinguishment in the form of a plea if
the plaintiff has urged his action after the termination of six months.
3. Submitting the request or the plea shall be against all the plaintiffs or the appellants
otherwise it shall be unaccepted.
Article (108)
As a consequent to the decision of the litigation extinguishment, the extinguishment of
the decisions issued therein with the probative procedure and the invalidation of all the
litigation procedures, including the initiatory pleading, shall take place. But neither the
right to prosecute it, nor the right in the final decisions issued therein, nor the right in the
precedent procedures of such decisions, nor the right in the statements issued from the
litigants nor the oaths they took shall be extinguished. However, that shall not prevent the
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litigants from adhering to the interrogation procedures and the works of expertise which
have been accomplished unless they were void in themselves.
Article (109)
Once the litigation extinguishment has been decided in the appeal, the appealed decision
shall be considered final in all circumstances, and once the litigation extinguishment has
been decided in a petition for retrial before the decision with the acceptance of the
petition, the petition request shall be extinguished. However, after the decision with the
acceptance of petition, the precedent rules concerning the appeal or the first degree, shall
be in operation, depending on the circumstances.
Article (110)
1. In all circumstances, the litigation shall be expired when two years shall have passed
from the last valid procedure there within, and the effects consequent to its expiry
shall be the same as the effects consequent to its extinguishment.
2. The content of the precedent clause shall not be applied on the appeal by means of
cassation.
Article (111)
1. The prosecutor may relinquish the litigation with a notification to his litigant party or
with an explicit statement in a brief, signed by him or by whoever represents him
legally, informing his party there about or stating it verbally at the session and he
shall record it in the minutes.
2. The relinquishment shall not be fulfilled after statement of the prosecuted with his
requests unless with his acceptance. However, his objection against the
relinquishment shall not be considered if he has taken a plea against the court’s
jurisdiction, forwarding the case to another court, the nullity of the initiatory
pleading, its illegality for a prior decision therein or because of other matters by
which there has been intention to prevent the court from its continuation to examine
the action.
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Article (112)
All the effects consequent to the extinguishment of the litigation shall be consequent to
its relinquishment and the relinquishing party shall be committed to pay the action costs
(fees).
Article (113)
1. If the litigant party, by the occurrence of the litigation, renounced, a procedure or one
of the papers of the procedures expressly or implicitly the procedure or the paper
shall be considered null and void.
2. Relinquishing the judgment shall be followed by the relinquishment of the right
inherent therein.

Title Eight. The Incompetence, Recusal and Dismissal of Judges
Article (114)
1. The judge shall be incompetent to examine the action, and prohibited from hearing it,
even if no one of the litigants has refused him, in the following circumstances:
a) If he were a husband of one of the litigant parties or were a relative or son-of-law
of him till the fourth degree.
b) If he or his wife had an existent litigation with one of the litigant parties or with
his wife.
c) If he were an attorney of one of the litigant parties in his private business, or
were his testamentary guardian, his custodian, or thought to be his heir, or a
husband of one of the litigant parties’ guardian, or of his custodian, or he had a
relationship or alliance till the fourth degree with that guardian, or custodian, or
with one of the board members of the litigant’s company or with one of its
managers and that member or manager had a personal interest in the action.
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d) If he, his wife, one of his relatives or his sons-in-law on the genealogy, or those
to whom he was attorney, testamentary guardian, or custodian, had an interest in
the existent action.
e) If there were between him and one of the circuit judges a relationship or a
relation by marriage till the fourth degree, and in such case the younger judge
shall be retreated.
f) If he had between him and the public prosecution’s representative or the defender
of one of the litigants a relationship or a relation by marriage till the second
degree.
g) If he had given a legal opinion, pleaded for one of the litigants in the action or
had written therein, even if that were before his engagement in the judiciary, or if
he had examined the action as a judge, expert or arbitrator or had born a witness
therein.
h) If he had prosecuted an action for indemnity against the recusal requester or
submitted an edict against him to the area of jurisdiction.
2. It shall be considered null the judge’s work or his judgment in the preceding cases,
even if it has been accomplished with the agreement of the litigant parties.
3. If such nullity has taken place in a decision issued in an appeal through cassation it
shall be possible to the litigant to ask the court for the cancellation of such decision
and for rehearing the appeal before a circuit at which the judge, for whom the nullity
reason has taken place, doesn’t work.
Article (115)
It is possible to recuse the judge for the following reasons:
1) If he or his wife had an action similar to the action he examines, or if a litigation had
emerged, for one of them, with one of the litigants or his spouse after prosecuting the
action which was submitted before the judge, unless such action has been prosecuted
with the intention of refusing him from examining the action submitted before him.
2) If his divorcee, from whom he had a son, or one of his relatives or of his sons-in-law
on the ancestral line had an existent litigation before the judiciary against one of the
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litigants in the action or against his spouse, unless such litigation has been prosecuted
after prosecuting the action which was submitted before the judge with the intention
of refusing him.
3) If one of the litigants used to work for him or he used to entrust one of the litigants or
used to live with him or had received a gift from him before or after prosecuting the
action.
4) If there had been between him and one of the litigants an enmity or a friendly relation
with which he would likely be considered unable to judge without inclination.
5) If one of the litigants had chosen him as arbitrator in a previous case.
Article (116)
1. If the judge was incompetent to examine the action or some reason has emerged to
recuse him, he shall have to tell the court president there about, and in case of the
emergence a recusal reason, the court president may permit the judge to retreat and
all that shall be recorded in a special report to be kept at the court.
2. Even if the judge has been competent to examine the action and no reason has
emerged to recuse him, and he feels disconcerted to examine the action for any
reason, he may expose his retreat order to the court president to examine his
declaration of retreat.
3. If one of the precedent cases has been actualized on the court president, he shall
expose the matter to his substitute.
Article (117)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. If a reason to recuse the judge has emerged and he hasn’t retreated the litigant party
may recuse him and the recusal shall occur through a request submitted to the
president of the court to which the judge belongs and the requester, himself or his
appointed attorney, shall sign it and the proxy shall be attached to the request, and the
request of the recusal should include its reasons and the papers supporting it should
be attached thereto.
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2. The recusal requester should deposit, by the request submission, an amount of Five
Thousand Dirham as an insurance, and the insurance number shall be multiplied
according to the number of judges whom recusal is to be requested, and the court
president shall not accept the recusal request if it has not been attached to what prove
the insurance deposition, and it shall be sufficient to deposit one insurance for each
recusal request in case of the multiplicity of the recusal requesters if they have
submitted their requests in one request even if the recusal reasons have been diverse,
and the court shall inflict on the requester of a penalty with a fine of not less than
Five Thousand Dirham and not more than Ten Thousand Dirham beside confiscating
the insurance if his request has been rejected.
Article (118)
1. The recusal request should be submitted after the submission of any plea or pleading
in the action, otherwise the right thereto shall be extinguished. However, the recusal
request may be submitted if the reasons thereof have taken place after that, or if the
recusal requester has proved that he hasn’t been aware thereof.
2. In all circumstances, the litigant party’s right to request the recusal shall be
extinguished if he hasn’t submitted the request before closing the defense in the first
refusal request submitted in the action, as far as he has been notified with the session
appointed for examining that request and the recusal’s reasons have been existing and
known to him till the closure of the defense.
Article (119)
1. The court president should inform the judge, whose recusal is requested, with the
recusal request and its attachments as soon as possible.
2. The judge should respond, in writing, to the recusal’s facts and its reasons within the
seven days following his notification, and if he hasn’t respond within that time-limit
or has accepted the recusal reasons and such reasons have been legally valid to
respond to, the court president shall issue an order for his removal.
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3. If the judge has responded to the recusal reasons and he hasn’t accepted a reason
which is legally valid for recusing him, the one before whom the request has been
brought shall appoint the circuit which shall assume the examination of the recusal
and he shall appoint the date of its examination there before, and the case
management office should notify the recusal requester and the judge with such date,
and, likewise, notify the rest of the parties in the principal action so that they may
submit the refusal requests they have according to the precedent clause, and the
mentioned circuit should proceed the investigation of the recusal request in the
deliberation chamber then, it shall decide, after hearing the statements of the recusal
requester and the judge’s notes, if necessary, or if he has asked that, and it shall not be
allowed in the investigation of the recusal request to question the judge or to direct
the oath to him.
4. In case of submitting recusal requests before closing the pleading in the first refusal
request, the court president, or whoever in his place according to the circumstances,
should forward such requests to the same circuit before which the request is being
examined so that it shall decide in all of them with one judgment.
5. The proceedings of the recusal request and the arbitration therein should progress
even if its requester has relinquished it.
6. The judgment shall be delivered in the recusal request at a public session and it shall
not be liable to the appeal.
Article (120)
As a consequent of the recusal request’s submission a cessation of the principal action
shall take place until such refusal request shall be finally decided in. However, it
shall be possible, in case of summary — and on the grounds of the other party’s
request — to assign a judge in the place of that whose recusal has been requested.
Article (121)
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The court of appeal shall decide in the recusal request if the person whose recusal has
been requested was a judge thereat or a judge at the court of first instance which belongs
to that court.
Article (122)
1. If there were a request for recusing all the judges of the court of first instance and the
court of appeal decided to accept the recusal request it shall forward the action to
another court of first instance decide in its facts.
2. If the recusal of all, or some, of the judges of the appellate court had been requested
in such a manner that the remaining judges would not be sufficient for the judgment,
the recusal request would be brought to the court of a higher degree there above, and
if it has decided to accept the recusal request it would forward the action to another
appellate court to decide in its facts.
Article (123)
The rules stipulated in the law of the supreme federal courts shall be applied concerning
the recusal of their president or judges.
Article (124)
The rules and procedures submitted in the context of refusing the public prosecution’s
member shall be followed if it were a joined party for one of the reasons stipulated in the
Articles (114) and (115).
Title Nine. Judgments
Chapter I. Pronouncing Judgment
Article (125)
The decisions shall be delivered from the federal courts and shall be executed in the name
of the state president.
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Article (126)
The court may not, after retaining the action or during the deliberation, hear one of the
litigant parties or his attorney unless in the presence of his litigant party, nor may it
accept papers or briefs from one of the parties without informing the other party thereof
otherwise the procedure would be void.
Article (127)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. Once the pleading in the action has been accomplished, the court shall decide in it or
postpone the judgment delivery to another forthcoming session which it shall
appoint, and it may not, after that, postpone, without necessity, the judgment delivery
more than once, and in both cases, the postponement period should not exceed one
month.
2. Each time the court has appoints a session for pronouncing the judgment it may not
postpone the judgment delivery or order the retrial of the action for the pleading
unless with a decision of good reasons and the court shall state it at the session and it
shall be recorded in its minutes, and the pronunciation of such decision shall be
considered a notification to both litigant parties with the new date.
Article (128)
1. The deliberation on the decisions shall be in secret among the judges meeting
together, and no one may take part therein except the judges who have heard the
pleading.
2. The president shall collect all the decisions starting with the most junior to the most
senior judge, then he shall give his opinion, and the decisions shall be delivered with
an unanimous or a majority of opinions recording the dissent in the decision’s draft. If
there were no majority and the opinions have diverged to more than two opinions, the
party which shall be less in number or the party which shall have the most junior
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judges should join one of the two opinions given by the party of greater number, and
that after taking the opinions another time.
3. Then the decision shall be pronounced in public by the judge or the circuit manager,
according to the circumstances.
4. The judges who have participated in the deliberation should be present at the
judgment pronunciation, however, if an impediment has occurred to one of them and
changed his authority, he should have signed the decision draft, provided that that
shall be recorded in the session minutes.
Article (129)
1. In all cases, the decisions should include the reasons on which they were based, and
the decision draft including its reasons should be deposited with the signature of the
president and the judges in the action file, when it shall be pronounced.
2. In the summary matters, it is possible, if the decision has been pronounced at the
pleading session, to deposit the draft including the reasons in the action file within
three days, maximum, from the date of pronouncing it.
3. The draft including the pronounced decision and its reasons shall be kept in the
action file.
4. The nullity of the decision shall be the consequent of the breach of the rules
stipulated in the clauses 1 and 2.
Article (130)
1. It should be shown in the decision the court which has delivered it, the date of its
delivery, its place, the case type, and the name of the judges who heard the pleading,
participated in the decision and attended its pronunciation, and the member of the
public prosecution who expressed his opinion in the case, if there was any, the names
of the litigant parties, their titles, their capacities, the residence of each one of them,
workplace and their attendance or absence.
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2. The decision should include a total presentation of the action facts, then the opposing
parties’ requests, a concise synopsis of their essential defense and the prosecution’s
opinion, after that, the decision reasons and its pronunciation shall be mentioned.
3. The failure in the factual reasons of the decision and the deficiency or flagrant fault
in the parties’ names and capacities, likewise the failure to manifest the names of the
judges who delivered the decision, shall result in the nullity of the decision.
Article (131)
1. The session president and its clerk shall sign on the decision’s original copy which
includes the action’s facts, reasons and pronunciation and that within three days from
depositing the draft for the summary cases and ten days for the other cases, and those
copies shall be kept immediately in the action’s file.
2. If any reason has emerged to hinder the session’s president from signing the
decision’s original copy or to suspend the signature in a manner that shall be
detrimental to justice or to the opposing parties’ interests, it shall be possible that the
court president or whoever represents him signs thereon, and if a reason, of what is
mentioned above, has emerged to the session clerk, the clerk’s chief (head) may sign
instead of him, and all that shall be recorded on the margin of the decision’s original
copy.
Article (132)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The judgment’s copy, by virtue of which the execution shall take place, shall be
stamped with the court’s seal and signed by the clerk, after attaching the executory
formula to it. The aforementioned copy shall only be delivered to the disputing party
who has an interest in the execution of the judgment, provided that the decision is
executable.
2. No other executory copy may be delivered to the same party unless the first copy is
lost or it was impossible to use it, by virtue of an order issued by the judge or the
head of circuit as the case may be.
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3. A certified copy of the judgment’s original copy may be given to any concerned
person who would request it and it shall not be given to other than them unless under
a permission from the judge or the head of circuit according to the circumstances.

Chapter II. Action’s Expenditures
Article (133)
1. The court, when the decision by which the litigation terminates, should automatically
decide in the action’s expenditure.
2. The expenditures of the action should be inflicted on the convicted therein and the
equivalent of the legal profession fees should be counted therein, and if the convicted
are many, it may be decided to divide the expenditures equally, or proportionally to
the interest of each one of them in the action, according to what the court shall
estimate, and they shall not be obliged to join unless they have been joint in their
decided commitment.
3. The intervention expenditures shall be decided on the intervener if he had
independent requests and his intervention has been judged as unacceptable or his
requests as refused.
Article (134)
The court may decide to compel the opposing party, if he has won the action, with all the
expenditures or some of them if the judgment beneficiary had caused to spend futile
expenditures or had left his party unaware of the documents he had and were decisive in
the action, or left him unaware of the contents of such documents.
Article (135)
If both opposing parties have failed in some requests it shall be possible to judge that
each party bears what he has paid of the expenditures or to decide the division of the
expenditures between them according to what the court would decide in its judgment, and
the court may also impose all the expenditures on one of them.
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Article (136)
1. The court may decide the compensation as an equivalent to the expenditures caused
by an action or a defense which was intended to be a conspiracy.
2. Without prejudice to the rule of law of Article (133), the court, by the delivery of the
decisive judgment in the matter, may inflict a fine of not more than a Thousand
Dirham against the opposing party who would undertake a malicious procedure, or
present an offensive request, plea or defense.

Chapter III. Rectification and Interpretation of Judgements
Article (137)
1. The court may, with a decision which it would issue on the grounds of the request of
one of the parties or of its own accord without pleading, amend whichever purely
material errors, literal or computational, which have occurred in its judgment, and the
session clerk shall undertake such correction on the decision’s original copy and he
shall sign it, he himself and the session’s president.
2. If the decision of refusing the correction has been issued, the appeal there against
shall not be allowed unless with the appeal in the judgment itself, as for the decision
which is issued with the correction, the appeal against it shall be possible
independently from the possible ways of appealing against the decision which is to be
corrected.
Article (138)
The litigant parties may request from the court which has delivered the decision, to
interpret any obscurity or vagueness occurring in its wordage, and the request shall be
submitted through the usual procedures for prosecuting the action, and the judgment,
together with the interpretation, shall be considered as fulfilling, from all angles, the
decision which it interprets, and it shall be applied thereon whatever rules that are
specific to the appeal manners.
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Article (139)
If the court has bypassed the decision in some substantive requests, it should, on the
grounds of a request from one of the concerned person, examine the request and the
decision therein after notifying the party therewith, and the decision shall follow the
appeal rules which are applied on the principal decision.

Title Ten. Orders on Petition
Article (140)
1. In the circumstances in which the opposing party wants to issue an order, he should
submit a petition with a request to the authorized judge or the circuit manger which
examines the action, and such petition shall be of two copies including the request’s
facts and its documents, the requester’s residence, his workplace, and determining an
elected domicile for him in the state if he had not a residence or a workplace therein,
and the petition will be attached to its confirming documents.
2. The judge or the division president shall issue, according to the circumstances, his
order in writing, on one of the petition’s two copies, on the following day to its
submission, at most, and it shall not be necessary to mention the reasons on which the
order has based unless it has been contradictory to another order prior to its issue, by
then, the reasons which necessitate the issue of the new order should be mentioned
otherwise it shall be void, and this order shall be recorded in a special report or in the
session’s minutes.
3. The order shall be executed with a letter which the judge or the division president
issues, according to the circumstances, to the concerned authority and the petition
shall be kept in the action’s file.
4. The order issued on a petition shall be extinguished if it hasn’t been submitted for
execution within 30 days from the date of its issue, and such extinguishment shall not
prohibit issuing a new order.
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Article (141)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. The requester, if the order has been issued with the rejection of his request, and the
one against whom the order has been issued, and the concerned persons, all have the
right to complain before the authorized court or the judge who has issued it,
according to the circumstances, unless the law stipulates otherwise, and examining
the complaint shall not hinder the proceeding of the principal action before the court.
2. The complaint should have its good reasons.
3. The complaint shall be submitted independently or pursuant to the principal action,
and that shall be through the procedures with which the interlocutory requests are
prosecuted.
4. The complaint shall be judged with the confirmation of the order, its amendment or
with its cancellation, and that decision shall be liable to the appeal through the usual
methods of appeal.
Article (142)
1. The complaint from an order shall not stay its execution.
2. However, the court or the judge may order the stay of the execution temporarily, in
accordance with the rules of Article (234).
Title Eleven. Orders of Payment
Article (143)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. With the exception of the general rules of the action prosecution, to start with, the
rules of the law stipulated in the following articles shall be applied if the creditor’s
right has been confirmed in writing and subrogated in the settlement, and all that he
has been claiming was a debt of a fixed amount of money or a movable specified
with a type and an amount, and such rules should be followed if the claimant of the
right was a creditor with a commercial paper and he has referred merely to the
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drawer, the clerk, receiver or the reserve guarantor of one of them, however, if he
wanted to refer to other than those he should follow the general rules of the action
prosecution.
2. If the creditor prosecuted his action through the usual methods in spite of the
availability of the issue conditions of settlement order, that would not hinder the
court from examining the action.
Article (144)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The creditor shall first require the debtor to pay the amount due within a time-limit of
five days at least, then he shall apply for, and receive, a payment order from the judge
of the court in whose district the debtor’s domicile is located. The amount of the right
required to be paid may not be less than the one required in the petition filed for the
obtainment of payment order. It shall be sufficient that the payment be required by
virtue of registered letter with acknowledgment of receipt, or by any method agreed
upon by the parties.
2. The payment order shall be issued based upon a petition submitted by the creditor.
The debenture and evidence of requirement of payment shall be attached to the
petition. The debenture shall remain at the case management office until the
grievance period expires.
3. The petition shall be made in two identical copies and shall include the information
to be included in the statement of claim as stipulated in Article (42) of the present
Law.
4. The order shall be issued based on one of the petition’s two copies within three days
at most from its submission and the amount of money due or the movables ordered to
be paid, as the case may be shall be mentioned in said order. Moreover, it shall be
mentioned in said order whether it was issued on commercial matter.
5. The aforementioned petition shall be considered as having the same effects of the
filing of lawsuit from the date of its submission, even if the court was incompetent.
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Article (145)
1. If the judge has decided not to accept all the requester’s requests or decided not to
issue the order for any other reason, he should abstain from issuing the order and
appoint a session for examining the action before the authorized court, by then the
court shall notify the debtor to attend there before at the appointed session with a
notification including the information of the petition mentioned in the preceding
article, and the rejection of the inclusion of the order’s immediate execution shall not
be considered a rejection of some requests in deciding this article.
2. And it is not allowed to any of the opposing parties to appeal against the forwarding
decision even after issuing of the judgment in the matter.
Article (146)
1. The debtor shall be notified in his original residence or his workplace with the
petition and with the order issued against him for the settlement.
2. The petition and the order issued thereupon for the settlement shall be considered null
and void if they have not been notified to the debtor within six months from the date
of issuing the order.
Article (147)
1. The debtor may complaint against the order within fifteen days from the date of
notifying him therewith, and the complaint shall take place before the authorized
court and through the usual procedures of the action prosecutions there before, and it
should be based on good reasons, and the complainant shall practically be considered
a plaintiff, then the rules, and procedures applied before the court shall be taken into
consideration when examining the complaint.
2. It shall be possible to appeal the settlement order according to the rules and
procedures established for the appeal of decisions and the date set for appealing the
order shall start from the expiry date of the complaint there against.
Article (148)
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The rules related to the immediate execution shall be applied on the settlement order and
the decision delivered in the complaint there against.
Article (149)
If the creditor, in the stipulation of the Article (143), wanted to inflict a seizure of what
the debtor had in the possession of others, the usual procedures shall be applied on the
seizure needed to be inflicted and on the action of the seizure validity.

Title Twelve. Means of Challenge Against Judgements
Chapter I. General Provisions
Article (150)
1. The appeal against the decisions shall not be possible unless brought by the
convicted, and it shall not be possible to be brought by that who accepted the
sentence expressly or implicitly, or by that whose requests have been judged, unless
the law stipulates otherwise.
2. The appellant shall not be harmed with his appeal.
Article (151)
It is not possible to appeal against the decisions delivered during the progression of the
action since the litigation has not been terminated therewith except with the delivery of
the decision terminating all the litigation, and that with the exception of the temporary
and summary decisions, the decisions issued for staying the action, the decisions liable to
the obligatory execution, and the sentences issued deciding the lack of jurisdiction, unless
the court had the authority to judge in the action.
Article (152)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
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1. The time-limit of appeal against the judgment shall start from the day following the
date of its issuance, unless the law stipulates otherwise. The aforementioned timelimit
shall start from the date on which the judgment is served to the convict in the
cases where the latter fails to appear in all the sessions set for the hearing of the case
and to submit a defense memorandum, as well as the cases where the convict fails to
appear and submit the relevant memorandums in all the following sessions, for the
expedition of proceedings after their interruption for any reason whatsoever.
2. The time-limit shall start from the date on which the judgment is served, should any
reason for the interruption of the proceedings occur and should the judgment be
issued without the involvement of the representative of a deceased, a party who lost
his competency, or a party who lost his capacity.
3. A judgment shall be served according to the conditions set in Article (8) of the
present Law.
4. The failure to observe the time-limits of appeal in the judgments shall result in the
extinguishment of the right of appeal, and the court shall sua sponte rule the
extinguishment of such right.
Article (153)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The time-limit of appeal shall be interrupted by the death of the convicted, the loss of
his capacity to sue or be sued or by the loss of capacity of the person who was
undertaking the proceedings on behalf of said convict.
2. The time-limit does not continue unless after the judgment is served to all the heirs
without mentioning their names and capacities, at the last domicile of their legator
should the heir be unknown or after it is served to the person who acts on behalf of
the party who have lost his capacity or his ability to sue and be sued.
3. In case the inheritors are known, the judgment shall be served according to the
conditions set forth in Article (8) of the present Law.
Article (154)
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* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. If the prevailing party dies during the period of appeal, his adversary may file the
appeal and serve same to all the inheritors without mentioning their names nor their
capacities, at the last domicile of their legator. The appeal shall be thereafter served
to all the inheritors while their names and capacities shall be mentioned, before the
session set for hearing the appeal or on the date set by the court for serving notice to
the heirs who were not served such notice in the first session. In case of summary
lawsuit, it shall be sufficient to serve notice to the appearing heirs.
2. If the prevailing party has lost the ability to sue and be sued during the appeal period,
or if the person undertaking the proceedings on his behalf has lost his capacity, the
appeal may be filed and served to the aforementioned persons. The appeal shall be reserved
thereafter to the person acting on behalf of the disputing party before the
session set for hearing the appeal or the date set by the court based on the
aforementioned.
3. In Paragraphs 1 and 2 of the present Article, notice shall be served according to the
conditions specified in Article (8) of the present Law.
Article (155)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The appeal shall be served according to the conditions set in Article (8) of the present
Law.
2. If the respondent is the plaintiff or the appellant, and neither the statement of claim
nor the appeal memorandum have contained the address whereat the notice is to be
served, and should no other documents of the lawsuit contain such address, notice
shall be served according to the conditions set in Article (8) of the present Law.
Article (156)
1. No one shall benefit from the appeal except the one who has prosecuted it, and no
one shall object thereto except the one against whom the appeal has been prosecuted.
However, if the decision has been issued in an indivisible matter or in a commitment
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for solidarity or in an action in which the law necessitates the litigations of certain
persons, it shall be possible that the convicted ones, who has missed the appeal date
or has accepted the sentence, appeal there against during the examination of the
appeal prosecuted on the date from one of his parts joining him in his requests, and if
he hasn’t done, the court shall order the appellant to litigate against the appeal, and if
the appeal has been prosecuted against one of the convicted on the date the litigation
of the rest shall be imperative even if its date has been elapsed regarding them.
2. If the appeal has been prosecuted on the date by the guarantor or the claimant of the
guarantee in the decision issued in the principal action, and their defense therein was
the same, the one who missed the date or accepted the sentence may appeal there
against joining his part, and if the appeal has been prosecuted against any of both on
the date it shall be possible to litigate the other one even after the date expiry
regarding him.
3. The guarantor and the claimant of the guarantee shall be benefit by the appeal
prosecuted from any of them in the sentence issued in the principal action if their
defense has united therein.
Article (157)
1. It shall not be possible to return the documents to the litigant parties who submitted
them except after the expiry of the appeal dates or after the decision in the prosecuted
appeal.
2. However, it shall be possible to give copies of such documents to whom of the
concerned persons who would request them.
3. If there is a need to deliver the documents’ originals that shall be by the order of the
judge or the circuit president, according to the circumstances, and one of their copies
shall be kept with the authentication of one of both and it shall be sealed with the
court’s seal.

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Chapter II. The Appeal
Article (158)
The litigant parties, in other than the circumstances excepted by the law stipulation, may
appeal the decisions of the courts of first instances before the authorized court of appeal.
Article (158/1)
* As amended by Federal Law No. (30) dated 30/11/2005:
It shall be possible to appeal the decisions issued within the framework of the final
quorum from the court of first degree because of the breaching the jurisdiction rules
related to the public order or because of the occurrence of an invalidity in the decision or
an invalidity in the procedures which has affected the decision.
It is possible also to appeal all the decisions within the framework of the final quorum if
the decision has been issued with a breach to a preceding decision which hasn’t allowed
the power of the order decided, and in such circumstance, the preceding decision shall be
considered appealed by the power of the law if it hasn’t become final when the appeal
was prosecuted.
The appellant, in such cases, when he submits the appeal, should deposit in the safe of the
appellate court, a mortgage of two thousand Dirham, and it shall be sufficient to deposit
one mortgage when there is a multiplicity of appellants if they have appealed with one
pleading even if the appeal reasons were different.
The case management office shall not accept the appeal brief if it were not attached with
what proves such deposit and the mortgage shall be confiscated by the power of the law if
the illegality of the appeal has been decided.
Article (159)
The time-limit of the appeal shall be 30 days unless the law stipulates otherwise, and the
time-limit shall be 10 days for the summary matters.
Article (160)
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If the decision has been issued according to a fraud occurring from the litigant parties,
according to a falsified paper, according to a falsified witness or because of the failure to
present a decisive paper in the action which the litigant party has withheld, the date of the
decision appeal shall not start but from the day on which the falsification appeared or on
which the falsification was admitted by its committer or judged with its verification or on
which the perjury witness was sentenced or from the day on which the withheld paper
appeared.
Article (161)
1. The appeal of the decision issued in the provisional claim shall definitely result in
appealing the decision rendered in the principal claim and, in this case, the successful
claimant in the original claim must be sued even after expiry of the time limit.
2. If the appellate court has cancelled the decision issued in the principal request, it
should return the case to the court of first instance to decide the provisional claim.
Article (162)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The appeal shall be filed by virtue of a memorandum submitted to the case
management office at the competent court of appeal. The memorandum shall be
immediately registered either in the relevant register or electronically and shall
indicate the appealed judgment, its date, the grounds of appeal, the requests as well as
the information related to the disputing parties’ names, capacities, domiciles of each
one of them and the domicile elected by the appellant in the country where the
competent appellate court is located, as well as the signature of the appellant or his
representative.
2. The appellant shall submit a sufficient number of copies of the memorandum of
appeal that corresponds to the number of respondents in addition to a copy to be
submitted to the case management office. The appeal supporting documents shall be
attached to each copy.
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3. However, the appellant shall be allowed to submit the grounds of his appeal until the
date of the first session set for hearing the appeal, otherwise the appeal shall be
dismissed.
Article (163)
1. The case management office of the court before which the appeal has been
prosecuted should demand the attachment of the file of the initiatory action on the
day following the day on which the appeal shall be prosecuted.
2. The case management office of the court of first instance, which has issued the
decision, should send the action file within ten days, at most, from the its request
date, and this date shall be reduced to three days in the summary action.
Article (164)
1. The appealed may, till the date of the first session of prosecution, prosecute an appeal
either through the usual procedures or through a brief including his appeal reasons.
2. The appeal mentioned in the preceding clause shall be considered a counter appeal if
it has been prosecuted within the time-limit of the appeal and a subsidiary appeal if it
has been prosecuted after the time-limit or if its prosecutor has accepted the sentence
in on a date prior to the prosecution of the original appeal.
3. The subsidiary appeal shall follow the principal appeal and it shall become void if the
principal appellant has relinquished his appeal or if it has been decided not to accept
the principal appeal formally, as for the counter appeal, it shall become void by the
extinguishment of the principal appeal whatever the way through which it was
prosecuted.
Article (165)
1. The appeal transfer the action in its state in which it has been before the issuing the
appealed decision in relation to what the appeal has prosecuted only.
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2. The court shall examine the appeal on the basis of what is submitted thereto of the
evidences, pleas and new aspects of defense and what had been submitted, before that
to the court of first instance.
3. The new requests shall not be accepted in the appeal, and the court shall decide on its
own accord with the disapproval. However, it shall be possible to add to the principal
request the wages, salaries and the rest of attachments which are due after submitting
the final requests before the court of first instance and what exceeds of the
indemnities after submitting such requests, likewise it shall be possible, with the
principal request’s matter remaining as is, to change its reason and adding thereto.
4. It shall not be possible in the appeal to involve that who has not been an opposing
party in the action in which the appealed decision has been issued, and it shall not be
allowed to intervene therein unless by that who requests to join one of the opposing
party or by that on whom the appealed decision is considered an evidence.
5. Appealing the decision terminating the litigation shall unquestionably be followed
with the appeal against all the decisions which have been issued in the case unless
they have been expressly accepted, taking into consideration what is stipulated in the
clause 1 of this article.
Article (166)
If the court of first instance decided in the matter and the appellate court found that there
has been a nullity in the decision or a nullity in the procedures affecting the decision, it
shall decide its cancellation and judge in the action. But if the court of first instance has
judged the lack of jurisdiction or the acceptance of a subsidiary plea that has had as a
consequent the hindrance of the action progression, and the appellate court has decided
the cancellation of the decision and the jurisdiction of the court or the rejection of the
subsidiary plea and decided to examine the action, it should return the case to the court of
first instance to decide in its matter.
Article (167)
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The court shall decide, in all circumstances, to accept the relinquishment of the litigation
in the appeal if the appellant has relinquished his right in the appeal.
Article (168)
The rules and procedures which are applied on the action before the court of first instance
shall be applied on the appeal, unless the law stipulates otherwise.

Chapter III. The Petition for Review
Article (169)
The litigant parties may request a petition for reexamining the decisions issued as final in
the following circumstances:
1) If a fraud has occurred by the litigant party and has influenced the decision.
2) If the decision was based on papers which have been declared as falsified or judged
as falsified, after issuing such decision, or the decision was based on a testimony of a
witness and it was judged, after its issue, as perjury.
3) If the petitioner, after issuing the decision, has obtained decisive papers in the action
which his opposing party hindered its submission.
4) If the judgment has decided something which the opposing parties haven’t requested
or decided more than what they have requested.
5) If the pronunciation of the sentence is self-contradictory.
6) For that against whom the decision issued in the action is considered an evidence,
and hasn’t been inserted or intervened in the action, on condition that the fraud of that
who was representing him, his collusion or his flagrant negligence has been verified.
7) If the decision was issued against a natural or legal person who hasn’t represented
with a valid representation in the action.
Article (170)
The time-limit of the petition shall be 30 days and it shall not start in the cases stipulated
in the clauses 1,2 and 3 of the preceding Article except from the day on which the fraud
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was disclosed or on which its committer confessed the fraud or on which its verification
was sentenced or on which the perjury witness was judged, or on which the paper, which
had been withheld, appeared. The time-limit in the circumstance stipulated in clause 6
shall start from the day on which the fraud, collusion or flagrant negligence has come to
light and in clause 7 from the day on which the decision has been notified to the
convicted or to that who represent him a valid representation.
Article (171)
1. The petition shall be prosecuted to the court which issued the decision with a brief
deposited in the court case management office according to the usual procedures of
the action prosecution.
2. The brief should include the manifest of the sentence in which the petition was
submitted, its date and the petition reasons or it shall be void.
3. The court which shall examine the petition may be consisted of the same judges who
have issued the decision.
4. The petition shall not be accepted if its brief hasn’t been attached with what prove the
deposit of a mortgage of Five Hundred Dirham, and the mortgage shall be
confiscated if the rejection of the petition, its disapproval, or its illegality has been
decided.
Article (172)
1. After hearing the opposing parties, the court shall decide, first, in the legality of the
petition, and if it approved it, it shall appoint a session for the prosecution in the
matter with no need for a new notification.
However, it may judge in the approval of the petition and in the matter with one
sentence if the opposing parties have submitted there before their requests in the
matter, and the court shall not reexamine except the requests which the petition
tackled.
The prosecution of the petition or its acceptance shall not have as a consequent the
stay of the sentence execution, however the court which examines the petition may
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order the stay of execution, when required, and when there is a fear that the execution
would cause a flagrant harm which would be impossible to avoid.
2. The court, when it orders the stay of the execution, may necessitate the submission of
a bail or order a person whom it shall consider a bondsman for securing the right
petitioned against him.
3. It shall not be possible to petition the reexamination of the decision which has been
issued with the rejection of the petition or in the decision in the matter of action after
its acceptance.

Chapter IV. The Cassation
Article (173)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. The opposing parties may appeal with a cassation in the decisions issued from the
appellate courts if the action value was more than Two Hundred Thousand Dirham or
was not evaluated and that in the following circumstances:
a) If the appealed decision was based on breaching the law or a mistake in its
application or its interpretation.
b) If a nullity in the decision or in the procedures affecting the decision has
occurred.
c) If the appealed decision was issued contrary to the rules of the jurisdiction.
d) If the litigation was sentenced with contradiction to another which was issued in
the same matter among the same opposing parties and acquired the power of the
order decided thereto.
e) The decision’s lack of reasons, inadequacy or its ambiguity.
f) If the decision has been issued with what the opposing parties haven’t requested
or with more than what they have requested.
2. The opposing parties may appeal before the court of cassation in any final decision –
whatever was the court which has issued it – which has decided in a litigation
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contrary to another decision which has previously been issued between the opposing
parties themselves and has acquired the power of the order decided therein.
3. The decisions issued from the appellate courts in the execution procedures shall not
be liable to the appeal through cassation.
Article (174)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
The attorney general may, sua sponte or upon a written request from the Minister of
Justice, file an appeal in cassation against any final judgment regardless of the court that
has issued it, should such judgment be based on a breach of the law or an error in its
application or interpretation, in the following cases:
1) The judgments that may not be contested by the parties under the Law.
2) The judgments whose appeal deadlines are missed by the parties, those against which
appealing is relinquished by the parties, or those against which the parties have filed
an appeal that has been rejected.
Such appeal shall be filed by virtue of a memorandum to be signed by the attorney
general within one year from the date on which the judgment was issued. The court
shall hear the appeal in the deliberation room without summoning the parties, while
they shall benefit therefrom.
Article (175)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. The appeal through cassation shall have as a consequent the stay of the decision
execution if it has been issued with divorce, the annulment of marriage or related to
the ownership of real estates, and in other than such cases the court may order the
stay of the decision execution temporarily if the appellant requested that in the
appeal’s pleading and was afraid that the execution would cause the occurrence of a
flagrant harm which would be impossible to avoid, and the authorized division
manager shall appoint a session for examining such request with which the requester
shall notify his opposing party through the appeal pleading, and if the court has found
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that stopping the decision execution or the appeal was based on other reasons than
the reasons stipulated in Article (173) of this law, it shall appoint a session for
examining the appeal within ninety days in a deliberation chamber.
2. The court, when it orders the stay of the execution, may necessitate the submission of
a bail or order whatever it would find sufficient for securing the right of the appealed.
This order which has been issued for stopping the decision execution shall include
the execution procedures which the convicting has undertaken on the basis of the
appealed decision therein from the date of the request for stopping the execution.
3. If the request has been rejected the appellant shall be committed with its
expenditures.
Article (176)
* As amended by Federal Law No. (30) dated 30/11/2005:
The time-limit of cassation shall be sixty days.
Article (177)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The appeal in cassation shall be filed by virtue of a memorandum submitted to the
case management office at the court that has issued the judgment, the Federal
Supreme Court, or the Court of Cassation, as the case may be. Such memorandum
shall be signed by a judge admitted to hear the pleading and shall be enclosed with
evidence of payment of the entire fees in addition to the guarantee. The appeal shall
be immediately registered in the relevant register.
2. Upon the submission of the memorandum, the appellant shall submit a number of
copies thereof that correspond to the number of respondents, in addition to a copy to
be submitted to the case management office.
3. Before setting a date for adjudication, the appellant shall submit the power of
attorney of the attorney in charge of undertaking the appeal proceedings.
4. In addition to the information related to the names, capacities and addresses of the
disputing parties, the memorandum shall indicate the contested judgment, the date of
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its issuance as well as the date on which it was served (if already served) and shall
also contain the appeal grounds and the appellant’s requests.
5. Should the appeal not be filed as mentioned above, it shall be deemed rejected, and
the court shall sua sponte rule its dismissal.
Article (178)
It shall not be allowed to insist before the court on a reason which hasn’t been included in
the appeal’s pleading unless the reason was related to the public order, then it shall be
possible to hold on thereto in any time and the court shall automatically consider it.
Article (179)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. A constant fee of Two Thousands Dirham shall be imposed on each appeal through
cassation and the ministries, societies, governmental circuits and what is similar
thereto in the state shall be exempted from paying such fee, and the court president,
or whoever represents him, shall undertake the decision in the requests for
postponing the fees or for the exemption there from and the submission of the
requests shall consequently cause the stay of the applicability of the date appointed
for the appeal.
2. The appellant by cassation should deposit in the court’s safe, by the time of paying
the fee fixed for the appeal, an amount of three thousands Dirham as a mortgage
which shall be given back to him if it has been decided to accept his appeal, but if the
appellants have prosecuted their appeal with one pleading it shall be sufficient to
deposit one mortgage.
The exempted from the judicial fees shall be exempted form the mortgage.
3. A constant fee of One Thousand Dirham shall be imposed on each request which the
appellant submits in order to stay the execution of the decision appealed in, and the
authorities mentioned in clause 1 of this Article shall be exempted from such fee.
Article (180)
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* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The case management office at the appellate court shall serve the memorandum of
appeal to the respondent within ten days from the date on which the appeal was filed.
The case management office shall request joining the file of the case that the
judgment issued on it is contested, within three days from the date of submission of
the memorandum. The case management office at the court that has issued the
judgment shall send the case file within ten days, at most, from the date on which the
file was requested. The case management office at the court that has issued the
judgment shall send the appeal with the case file, within ten days from the date of
submission of the judgment thereto.
2. The court may decide to content with the certified copy of the judgment, that is
submitted by the appellant, instead of requesting the case file.
3. The respondent may submit a defense memorandum within fifteen days from the date
on which the notice is served.
4. The court may allow the disputing parties to submit new information to support their
defenses, and it may also undertake every procedure it deems useful for it to decide
upon the appeal.
Article (181)
1. The appealed may insert in the appeal any opposing party in the action in which the
appealed sentence was issued and against whom the appeal hasn’t been prosecuted,
and this involvement shall be through his notification with the appeal, provided that
such notification shall be accomplished within the time-limit stipulated in clause 3 of
the preceding article.
2. The one who has been introduced in the appeal may deposit in the case management
office of the court a pleading with his defense within fifteen days from the date of his
notification, and the appellant has the right to reply to such pleading according to the
dates stipulated in the preceding article.
Article (182)
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Each opposing party in the action in which the appealed sentence has been issued may, if
he hasn’t been notified by the appellant with his appeal, intervene in the appeal in order to
request the decision to reject it, and its intervention shall be done by depositing a
pleading of with his defense in the case management office before the expiry of the timelimit
stipulated in clause three of Article (180).
Article (183)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. The authorized circuit manager shall appoint a judge for preparing a report resuming
the aspects of the appeal and the refutation there against, and the case management
office should display the action file, as soon as the report has been deposited, to the
manager in order to appoint a session for examining the appeal in the deliberation
chamber. If the court has found out that the appeal is not accepted for its
extinguishment or for the nullity of its procedures or for its being based on other than
the reasons mentioned in Article (173), it shall order its disapproval with a decision
which is to be recorded in the session minutes with a brief allusion to the decision
reason.
2. If the court considers that the appeal is worth examining it shall appoint a session for
examining it in order to read the resuming report and the court shall decide in the
appeal after the deliberation and without a defense.
If the court realized the necessity of the verbal defense it may hear the statements of
the lawyers in behalf of the opposing parties or may hear the parties themselves.
Article (184)
If the court has accepted the appeal and the matter was valid to decide in or the appeal
was prosecuted for the second time, it shall take the responsibility to decide therein and it
may fulfill the necessary procedures, but in other circumstances, the court shall decide
the cassation of the entire sentence or part thereof and forward the action to the court
which has issued the appealed decision unless the court has deemed appropriate to
examine it before a circuit consisted of other judges or to forward it to an authorized
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court to decide therein again, and the court to which the action has been forwarded shall
be committed to decide in the cassation in the points decided.
Article (185)
1. The abolishment of all the decisions on which the appealed decision has been based
shall be the consequence of the decision cassation, whatever was the court which had
issued it.
2. If the decision hasn’t been refuted except in a part thereof it shall remain in effect in
relation with the other parts, unless they have been subsequent to the refuted part.
Article (186)
If the court decided the illegality of the appeal, its disapproval or its rejection, entirely or
partially, it shall inflict on its prosecutor with the appropriate expenditures as well as
confiscate all or part of the mortgage, according to the circumstances.
Article (187)
It is not possible to appeal against the cassation decisions through any of the appeal
manners, and that with the exception of what has been issued there from in the litigation
source where it shall be possible to appeal therein through the petition of reexamining the
cases stipulated in clauses 1, 2 and 3 of Article (169).
Article (188)
1. The rules applied on the appeal before the appellate court shall be applied on the
appeal through cassation in case there is no contradiction with the terms of this
section.
2. The appeal through cassation shall be in the decisions issued from the federal courts
before the supreme federal court in the circumstances and according to the
procedures and rules mentioned before. In case of what hasn’t been mentioned with a
special statement in this section, the rules of the Federal Law No. (10), for the year
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1973 A.D. shall be applied concerning the supreme federal court and its amending
laws.

BOOK TWO. VARIOUS PROCEDURES AND LITIGATIONS
Title One. Tender and Deposit
Article (189)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
The debtor may, if he wishes to pay the amount due, offer the creditor the money,
documents or movables he undertakes to provide to him at the debtor’s domicile.
The offer shall be provided based on an application submitted to the case management
office or to the president of the Court of First Instance, as the case may be, and it shall be
served on the creditor by the process server, then a report shall be prepared thereon
including the subject-matter of the offer, the conditions of the offer its acceptance or its
rejection. The offer may be provided at the session before the court without the need to
take any procedures should the party to whom the offer was offered be present.
Article (190)
The debtor may request, with the offer, the creditor’s consent on the release of his estates
from the real bail or from any other bond restricting the disposition.
Article (191)
It shall be stipulated as conditions for the validity of the offer the following:
a) To be directed to that who is legally competent of the reception or who represents
him.
b) To be addressed from a person who holds good to undertake the settlement.
c) That the offer includes the sums, the sources, the attachments and the expenditures.
d) That the condition related to the commitment is to be fulfilled.
e) That the debtor submits his offer to the creditor himself or at his residence.
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Article (192)
1. If the offer was money or other items that can be moved or lodged in the court’s case
and the person, to whom the offer was submitted, has rejected it, the president of the
court of first instance or the session’s president, according to the circumstances, shall
give orders to lodge them immediately in such case.
2. If the offer has been rejected and the offered was not possible to lodge in the court’s
case the session president or the president of the court of first instance shall give
orders, according to the request of the process server* and according to the
circumstances, to lodge it in the place he shall locate, and that if the item were
possible to move without difficulty, however, if it were prepared to stay where it
existed or it were difficult to move but with difficulty, he shall give orders to put it
under receivership.
* The expression “process server” has replaced the expression “notification
server”, wherever mentioned, by virtue of Article (1) of the Federal Law No.
(10) of 2014 dated 20/11/2014.
3. If the offered were subject to damage or would cost excessive expenses for its
lodging or for its receivership the debtor or the process server may request the
president of the first instance to give orders to sell it at a public auction and deposit
the price in the court’s case, and if it had a given price in the market or its transaction
was current it shall not be possible to sell it at the public auction except if the sale has
been difficult dealing with the given price.
4. The offer’s bidder may request the decision with the validity of the offer.
Article (193)
There shall be no decision with the validity of the offer unless the offered item has been
lodged together with its attachments which have been due until the lodging day, and the
court shall decide, together with the validity of the offer, the discharge of the debtor from
the day of the offer.
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Article (194)
The debtor may retract from an offer which his creditor hasn’t accepted and retake what
he lodged after the expiry of ten days from the date on which he had notified his creditor
with the offer and the lodging.
Article (195)
It is not possible to retract from the offer nor to restore the deposit after the creditor’s
acceptance of that offer or after issuing the decision with the validity of the offer and its
final outcome.
Article (196)
It is possible that the creditor accepts an offer which has previously rejected and that he
receives what was deposited as a guarantee thereto unless the debtor has retracted from
his offer.

Title Two. Challenge of Judges and Members of the Public Prosecution
Article (197)
It is possible to litigate the judges of the courts of first instance and the courts of appeal
and the members of the public prosecution in the following circumstances:
1) If a fraud, a deceit or a flagrant professional mistake has been committed by the
judge or the member of the public prosecution.
2) In the other circumstances in which the law decides the responsibility of the judge
and inflicting on him indemnities.
Article (198)
1. The litigation action shall be prosecuted with a report in the case management office
of the appellate court to which the judge or the public prosecution’s member belongs
and the requester or whoever represents him in that shall sign it, and the report should
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include a statement of the dispute’s aspects and its evidences and the confirming
papers thereof shall be deposited with it with a mortgage of a thousand Dirham.
2. The dispute shall be manifested in order to examine its approval before one of the
appellate court’s circuit by an order from its president after notifying the judge or the
public prosecution’s member with a copy of the report.
The dispute shall be examined in the deliberation chamber at the first session held
after the eight days following the notification and the case management office shall
notify the requester and the disputed with the session, and if the disputed judge were
a judge at the appellate court or the disputed member of the public prosecution were
the attorney general or an attorney, at least, one of the circuits of the cassation shall
undertake the decision, in the deliberation chamber, for accepting the dispute, and if
it has decided to accept it, it shall forward the examination of the dispute matter to a
special circuit consisted of five of its judges according to the hierarchy of their
seniority.
Article (199)
The court shall judge, as soon as possible, in the relevance of the dispute aspects to the
action and its acceptance, and that shall be after hearing the requester or his attorney and
the disputed judge or the disputed public prosecution’s member, according to the
circumstances, in person or through an attorney from the judiciary persons and the
prosecution’s statements if it has intervened in the action.
Article (200)
1. If the acceptance of the dispute were decided, the decision shall appoint a session for
examining the dispute matter at a public session and it shall be decided therein after
hearing the disputed requester and the prosecution’s statements if it has intervened in
the action.
2. The judge shall be incompetent to examine the action from the date of the decision of
accepting the litigation
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Article (201)
1. If the disapproval of the dispute were decided in form or were rejected in content, the
requester shall be inflicted with the confiscation of the mortgage with the
indemnities, if they had a side.
2. If the validity of the dispute were decided, the judge or the prosecution’s member
shall be inflicted with the indemnities, expenditures and the nullity of his power of
disposition, and the state shall be responsible with what shall be inflicted as
indemnities on the judge or the prosecution’s member, and it shall have the right to
claim it, and its execution shall be possible directly with the decision issued in the
dispute action.
3. However, The nullity of the sentence shall not be decided for the benefit of an
opposing party other than the prosecutor in the dispute action except after notifying
him to give his statements, and it shall be possible in such circumstance that the court
would issue in the principal action a new decision if it has considered it valid for the
settlement and that shall be after hearing the opposing parties’ statements.
Article (202)
It is not possible to appeal against the decision issued in the litigation action except
through cassation.

Title Three. Arbitration
Article (203)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. It shall be possible that the contractors, in general, state as a condition in the principal
contract or with a subsequent agreement, the exposition of what may arise among
them of litigations concerning the execution of a certain contract, to one or more
arbitrators, and it is also possible to agree on the arbitration in a certain litigation
under special conditions.
2. The agreement shall not be recorded except in writing.
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3. The litigation’s facts should be designated in the arbitration document or during the
examination of the action even if the arbitrators were authorized for reconciliation,
otherwise the arbitration shall be void.
4. It shall not be possible to arbitrate in the matters in which the reconciliation is not
possible, and it shall not be valid to agree on the arbitration unless by those who have
the capacity of disposition in the litigated right.
5. If the litigant parties have agreed on the arbitration in some litigation, it shall not be
possible to prosecute an action therewith before the judiciary, however, if one of the
two litigant parties has resorted to prosecute the action without taking into
consideration the arbitration condition and the other party hasn’t objected at the first
sessions, the action should be examined and the arbitration condition shall be void.
Article (204)
1. If the litigation has occurred and the litigant parties haven’t agreed on the arbitrators,
or one or more arbitrators, who was agreed on, has abstained from the work, has
retired there from, has been dismissed there from, or his refusal has been decided, or a
hindrance has prevented his undertaking therein, and there were not an agreement
between the litigant parties concerning that, the court which is principally authorized
to examine that litigation shall appoint whoever shall be needed of the arbitrators, and
that on the grounds of a request from one of the litigant parties, through the usual
procedures of the action prosecution. The number of those appointed by the court
should be equal to the number agreed on between the litigant parties or completing
thereto.
2. It shall not be possible to appeal against the decision issued in that through any of the
proceedings of appeal.
Article (205)
It shall not be possible to authorize the arbitrators for the reconciliation unless they were
mentioned by their names in the agreement on the arbitration or in a subsequent
document.
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Article (206)
1. The arbitrator should not be minor, legally incompetent, deprived from his civil rights
because of a criminal penalty or bankrupt unless he has been rehabilitated.
2. If there were many arbitrators there numbers, in all circumstances, should be odd.
Article (207)
1. The arbitrator’s acceptance should be in writing or by proving his acceptance in the
session minutes.
2. If the arbitrator has withdrawn, without serious reason, from his work after his
acceptance of the arbitration, it shall be possible to inflict indemnities on him.
3. He may not be dismissed except with the consent of all the litigant parties, however
the court which was principally authorized to examine the action, and on the grounds
of one the litigant parties request, may dismiss the arbitrator and give order to appoint
a substitute in his place in the manner in which he was appointed in the beginning,
and that in the case of proving that the arbitrator has intentionally neglected the work
according to the agreement of the arbitrators in spite of drawing his attention, in
writing, thereto.
4. It shall not be possible to refuse him from the arbitration except for reasons which
would occur or appear after his personal appointment, and the refusal shall be
requested for the same reasons for which the judge is refused or because of which he
shall not be competent to arbitrate. The refusal request shall be prosecuted to the court
which is principally authorized to examine the action within five days from the
litigant party’s notification with the arbitrator appointment or from the date of the
occurrence of the refusal reason or the acknowledgement thereof if it were next to his
notification with the arbitrator appointment. In all circumstances, the refusal request
shall not be accepted if the court’s decision has been issued and the pleading in the
case has been closed.
Article (208)
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1. The arbitrator shall, within thirty days at most from the acceptance of the arbitration,
notify the litigant parties with the date of the first session fixed to examine the
litigation and with its meeting place and that without obligation to the rules settled in
that law for the notification and he shall fix for them a date to submit their documents,
briefs and defense aspects.
2. It shall be possible to arbitrate according to what one side shall submit if the other
party failed to do on the appointed date.
3. If the arbitrators were many they should undertake, together, the investigation
procedures and each of them should sign on the reports.
Article (209)
1. The litigation shall cease before the court if one of the reasons of the litigation
severance, set in this law, has emerged, and the severance shall result in its effects
which were legally set unless the action has been held for judgment.
2. If a priority matter which is not related to the arbitrator’s authority, or an appeal
against a paper falsification, or a criminal procedures have been taken in its
falsification, or in another criminal incident has been exposed during the arbitration,
the arbitrator shall stop his work until a final decision shall be issued therein, and the
arbitrator shall also stop his work in order to refer to the authorized court’s president
to proceed the following:
a) The sentence with the penalty legally set on the witnesses who fail to attend or
abstain from answering.
b) The decision charging the others to show a documents in his possession which is
necessary for the decision in the arbitration.
c) The decision in the judicial writs.
Article (210)
1. If the litigant parties haven’t set, as a condition in the agreement, a date for the
arbitration the arbitrator should arbitrate within six month from the date of the session
of the first arbitration, otherwise anyone who wanted of the litigant parties may
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prosecute the litigation to the court or may continue therein before the court if it was
prosecuted before that.
2. The litigant parties may agree, expressly or implicitly, to extend the appointed date,
by agreement or by law, and they may authorizing the arbitrator to extend it to a
certain date and the court may, according to the request of the arbitrator or one of the
litigant parties, prolong the time-limits appointed in the preceding clause to the period
which it shall find adequate for deciding in the litigation.
3. The date shall be suspended as far as the litigation is suspended or severed before the
arbitrator and its progression shall be resumed from the date of the arbitrator’s
acknowledgment of the extinguishment of the suspension or the severance’s reason,
and if the rest of the time-limit were a month it shall be extended to a month.
Article (211)
The arbitrators should administer an oath on the witnesses and everyone who shall
perjure before the arbitrators shall be considered a committer of the crime of perjury.
Article (212)
1. The arbitrator shall deliver his decision without obligation to the pleading procedures
except what has been stipulated in this chapter and the procedures concerning the
litigant parties’ action and hearing their defense’s aspects, and enabling them to submit
their documents, however, the litigant parties may agree on certain procedures
according to which the arbitrator should proceed.
2. The arbitrator’s decision shall be according to the rules of the law unless if it were
authorized with the reconciliation, then it shall not be obliged with such rules except
with those related to the public order.
3. The rules related to the summary execution shall be applied on the arbitrator’s
decisions.
4. The arbitrator’s judgment should be delivered in the state of the United Arab Emirates,
otherwise the rules set for the arbitrators’ decisions delivered in a foreign country shall
be followed therein.
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5. The arbitrators’ decision shall be delivered with a majority of opinions and it should
be written together with the contradictory opinion, and it should particularly include a
copy of the arbitration agreement and a resume of the litigant parties’ statements, their
documents, the decision’s reason and its pronunciation, its delivery date, its delivery
place, the arbitrators’ signatures, and if one or more of the arbitrators has refused to
sign the decision that should be mentioned therein, and the decision shall be valid if
the majority of the arbitrators have signed it.
6. The decision shall be compiled in Arabic unless the litigant parties have agreed
otherwise, in such case, an official translation should be attached thereto when it is
deposited.
7. The decision shall be considered delivered from the date of the arbitrators’ signature
thereon after writing it.
Article (213)
1. In case of the arbitration proceeded through the court, the arbitrators should deposit
the decision with the original of the arbitration record, the reports and the documents
in the case management office of the court authorized principally to examine the
action, and that shall be within the fifteen days following the decision’s delivery and
they should deposit a copy of the decision in the case management office of the court
to deliver them to each party side and that within fifteen days from depositing the
original and the case management office of the court shall compile a report with that
deposit to manifest it to the judge or the division manager, according to the
circumstances, in order to appoint a session within fifteen days to authenticate the
decision and the two parties shall be notified therewith.
2. If the arbitration were incoming in an appellate case the deposit shall be in the case
management office of the court authorized principally to examine the appeal.
3. As for the arbitration which takes place between the litigant parties outside the court,
the arbitrators should deliver a copy of the decision to each party within five days
from the delivery of the arbitration decision and the court shall examine the
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authentication or the nullity of the decision according to the request of one of the
litigant parties through the usual procedures of the action prosecution.
Article (214)
The court may, during the examination of the authentication request of the arbitrators’
decision, return it to them in order to examine what they have failed to arbitrate in the
arbitration matters therein or to clarify the decision if it were not definite in a way that
makes it impossible to execute, and the arbitrators should, in both cases, deliver their
decision within three months from the date of their notification with the decision unless
the law shall decide otherwise.
It is not possible to appeal against its decision except with the final sentence delivered
with the authentication of the sentence or its invalidation.
Article (215)
1. The arbitrators’ decision shall not be executed except if the court in which case
management office the decision was deposited, has authenticated it, and that after
looking into the decision and the arbitration document and verifying that there is no
prohibition to execute it, and such court shall be authorized to amend the material
errors in the arbitrators’ decision according to the request of the concerned persons
through the proceedings set for amending the arbitrations.
2. The execution judge shall be authorized with all that concerns the execution of the
arbitrators’ decision.
Article (216)
1. The litigant parties may request the nullity of the arbitrators’ decision when the court
examines its authentication and that shall be in the following circumstances:
a) If it has been delivered without an arbitration report or delivered according to a
void document or a document that has been extinguished by the failure to observe
the date or if the arbitrator has gone beyond the document’s limits.
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b) If the decision has been delivered by arbitrators who were not assigned according
to the law or it has been delivered by some of them who were not allowed to give
the decision in the absence of others, or delivered according to an arbitration
document in which the litigation facts have not been determined, or delivered by a
person who had not the capacity of the arbitration agreement, or by an arbitrator
who did not fulfill the judicial conditions.
c) If a nullity in the decision or a nullity in the procedures which has affected the
decision has occurred.
2. The acceptance of the nullity shall not be restrained by the litigant party’s
relinquishment of his right therein before the delivery of the arbitrators’ decision.
Article (217)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. Arbitration awards may not be contested in any method of cassation.
2. As for the judgment confirming or invalidating the arbitration award, it may be
contested in the prescribed cassation methods.
3. By way of exception from the provisions of the preceding paragraph, the judgment
may not be appealable if the conciliating arbitrators or the disputing parties have
expressly relinquished the right to appeal, or the litigation value was not exceeding
AED 20,000.
Article (218)
The arbitrators shall be allowed to valuate their fees and the arbitration expenditures, and
they may inflict all or part of them on the losing party, and the court, on the basis of the
request of one of the litigant parties, may amend that valuation with what shall be
adequate to the effort done and the litigation nature.

BOOK THREE. THE EXECUTION
Title One. General Provisions
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Chapter I. The Execution Judge
Article (219)
1. The execution is to proceed under the supervision of an execution judge
commissioned to the location of each court of first instance and assisted by a
sufficient number of executions representatives.
2. The procedures decided before the court of first instance shall be applied before him,
unless the law stipulates otherwise.
Article (220)
1. The execution judge shall be exclusively authorized to execute the executive
document and to decide in all the temporary litigations of the execution with a
summary proceeding. Moreover, he shall be authorized to deliver the sentences,
decisions and orders related thereto.
2. The authorization of the execution judge shall be in the court’s area which has
delivered the sentence, the decision, or the order or in which area the executive
document has been documented or authenticated, or in the court’s area in which the
residence of the convicted and his estates are located.
3. If the execution were dependent on a temporary proceeding or a notification and the
execution location of such procedure were in another court’s area, the authorized
execution judge shall deputize, for that, the execution judge in whose area the
procedure is required to be undertaken.
4. If the execution included:
a) Sequestered movables in the possession of the debtor which are located in another
court’s area.
b) Sequestered properties in the possession of a third person whose residence is
located in another court’s area.
c) Sequestered real estates located in another court’s area or several courts’ circuits.
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d) The obligation to deliver a certain item whenever the residence of the convicted is
located in another court’s area.
By then, the authorized execution judge should forward the matter to an execution
judge in any of the areas mentioned above in order to deliver such item or to sell
such sequestered items.
5. Should the sequestrations be multiple through execution judges in different court
circuits, the execution judge having imposed the first sequestration shall be competent
to distribute the sun of sales among creditors.
6. Should the procedure required to be taken is constituted of an imprisonment order, in
accordance with the provisions of the imprisonment of debtors set forth herin, and
should the residence of the debtor be within the circuit of another court other than the
court where the executive deed is executed, the competent execution judge shall refer
the matter to the execution judge where the procedure is required to be taken in the
court thereof to carry out the investigation, and to issue and execute the appropriate
order.
Article (221)
1. The writ (the request for legal assistance) and the reference shall be proceeded from
the authorized execution judge to the execution judge in whose area the procedures
are required to be undertaken, and all the needed legal documents for its execution
shall be attached thereto.
2. The execution judge who has been requested for legal assistance or to whom the
procedures have been forwarded, shall undertake the necessary decisions to execute
such request (writ) or reference and he shall decide in the execution problems exposed
to him, and his decisions which are subject to the appeal shall be appealed before the
appellate court in his area.
3. The execution judge who has proceeded the execution of the writ or the reference
shall inform the execution judge with what has been accomplished and shall forward
to him any items or other properties he has received as a result of the sale of the
sequestrations.
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4. If the execution judge requested for legal assistance or referred to has found that there
were legal reasons preventing the execution or if it was impossible for him to
undertake the execution for any other reason, then he should inform the authorized
execution judge about that.
Article (222)
1. The decisions of the execution judge shall be subject to the appeal in the following
circumstances:
a) The authorization of the execution judge or his lack of authorization to execute
the executive document.
b) That the confiscated properties may or may not be sequestered or sold.
c) The participation of other persons, other than the litigant parties, in the
confiscation.
d) Arranging the priority among the persons for whom the conviction has been
delivered.
e) Postponing the execution of the decision for any reason.
f) Whether if it were possible to detent or not that who fails to pay the decided sum
of money.
g) Giving the debtor a time limit to settle the sum of money for which the execution
has been undertaken, or to pay it in installments.
2. Such decisions shall be appealed before the authorized appellate court within seven
days from the date of issuing the decision if it were in the presence of the parties and
from the date of its notification if the decision was issued in their absence.
3. The appeal shall have as a consequent the stay of the execution procedures until the
appellate court shall decide in the litigation. However, if the appeal were for a
detention decision the appellant should present a bondsman whom the execution
judge accept to be responsible to summon the person against which the execution is
proceeding or to settle the sum of money decided, in case of his failure to summon
him. If the guarantor has failed to summon his guaranteed, the court shall bind him
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with the value of the bail and it shall be collected from him through the proceeding
through which the decisions are executed.
Article (223)
1. A special record shall be prepared at the court for registering the execution requests.
2. For each request there shall be a file in which all the papers related to such requests
are to be lodged.
3. The file shall be exposed to the execution judge in order that he shall stipulate therein
the judgments, decisions and orders which he shall deliver.
Article (224)
1. The execution shall be undertaken by the execution agents on the basis of the
concerned persons’ request when the executive document has been submitted and the
execution judge has ordered that.
2. If a resistance or an aggression has occurred against the execution agent and that has
resulted in the interruption of the execution, he should undertake all the precautionary
proceedings and request the public authority.

Chapter II. The Writ Execution
Article (225)
1. The obligatory execution shall not be possible except by an executive document in
case of need for a right verified, evaluated and due of performance.
2. The executive documents are:
a) The decisions and orders.
b) The instruments in writing which are documented according to the law regulating
the documentation and authentication.
c) The reconciliation minutes sessions which the courts authenticate.
d) The other papers which the law gives such capacity.
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The execution shall not be valid in other than the circumstances excepted by the
stipulation of the law unless by a copy of the executive document on which the
following execution phrasing should be included:
“The competent authorities and bodies should undertake the execution of this
document and proceed in what it necessitates and they should help with, even
obligatorily, its execution whenever they would be required to do so”.
3. The executive documents shall not be executed if they have been left for a period of
fifteen years or if they have been relinquished the same period without execution
since their issue.
Article (226)
It is possible that the court of summary matters, or in the circumstances where the delay
shall be damaging, would give orders, according to the concerned person’s request, to
execute the decision on the basis of its draft without a notification and without putting an
executive phrasing thereon, and in such circumstance, the clerk shall deliver the draft to
the execution agent who shall return it after the accomplishing of the execution.

Chapter III. The Summary Execution
Article (227)
1. It is not possible to execute the decisions forcibly as long as the appeal therein is
possible through the appeal proceeding unless the summary execution is stipulated in
the law or decide thereby.
2. However, it shall be possible according to them, to undertake precautionary
procedures.
Article (228)
1. The summary execution shall be obligatory by the law in the following circumstances:
a) The decisions delivered in the summary matters whatever was the court which has
delivered them.
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b) The orders issued on the pleadings.
2. The summary execution shall be without a bail unless the submission of a bail has
been stipulated in the decision or the order.
Article (229)
The court, according to the concerned persons’ request, may comprise its decision with
the summary execution with or without a bail in the following circumstances:
1) The decisions delivered in the commercial matters.
2) If the convicted has admitted the establishment of the commitment or has litigated in
its limits or claimed its expiry.
3) If the decision has been delivered as an execution to a previous decision which had
the power of the decided order or was comprising the summary execution without a
bail, or was based on an official document against which there has been no appeal for
falsification, or a martial document which hasn’t been disclaimed as long as the
convicted has been a litigant party in the previous decision or a party in the document.
4) If the decision has been delivered to the advantage of the execution requester in a
litigation concerning him.
5) If the decision has been delivered with the payment of wages, salaries, or indemnities
caused by a business relationship.
6) If the decision has been delivered in one of the actions of possession or with the
dislodgment of a tenant of a real estate of which contract has been expired or broken,
or with the expulsion of the real estate occupant who had no document when the right
of the prosecutor was not disclaimed or was confirmed with an official document.
7) In any other circumstance, if the delay of the execution shall cause a flagrant harm to
the person for whom the decision has been delivered, provided that that shall be
clearly manifested in the decision.
Article (230)
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1. The summary execution — by the power of law or by the decision of the court —
shall also extend to include the attachments of the principal request and the action’s
expenditures.
2. Comprising the decision with the summary execution may not be agreed on before its
delivery in other than its circumstances.
Article (231)
In the circumstances in which it is not possible to execute the decision or the order except
with a bail, the person committed to pay it may have the choice either to present a
wealthy bondsman or to deposit in the court’s case what shall be sufficient of currency or
money bills, or to accept to deposit in the court’s case what he would collect from the
execution, or to deliver what is required to be delivered in the decision or in the order to a
faithful judicial receiver.
Article (232)
1. The person bound to the bail shall declare his choice either by the help of the
execution agent with an independent paper, or included in the notification of the
execution document.
2. The choice should, in all cases, include the determination of an elected domicile, in
the state, of the execution requester if he hasn’t residence nor a workplace therein, so
that he can be notified with the papers related to the litigations in the bail.
3. The concerned persons may, within three days form the notification with the choice,
prosecute before the execution judge a complaint to litigate therein the capacity of the
bondsman, the faithfulness of the judicial receiver, or the sufficiency of what he has
deposited, and the decision in the complaint shall be final.
4. If the complaint hasn’t been prosecuted on the fixed date or it has been prosecuted
then refused, the execution judge shall impose a commitment on the bondsman to bail
or on the judicial receiver to accept the receivership and the report including the
commitment of the bondsman and the judicial receiver shall be considered an
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executive document there before with the obligations following the bondsman’
commitment or the judicial receiver’s acceptance.
Article (233)
1. It is possible to prosecute the complaint before the appellate court against the decision
quality and that through the usual procedures of the appeal prosecution and the
attendance date shall be three days.
2. It shall be possible to reveal such complaint at the session, even after the expiry of the
appeal dates, during the examination of the appeal prosecuted against the decision.
3. The complaint shall be judged independently from the matter.
Article (234)
1. In all circumstances, the court to which the appeal or the complaint has been
prosecuted may give orders, according to the request of the concerned persons, to stay
the execution if there is fear from the occurrence of a flagrant damage by the
execution.
2. The court may, when the stay of the execution has been decided, necessitate the
submission of a bail or order what it considers adequate to secure the right of the
person for whom the decision has been delivered.

Chapter IV. Enforcement of Foreign Judgments, Orders and Bills
Article (235)
1. The execution of the decisions and orders delivered in a foreign country may be
mandated in the state of the United Arab Emirates under the same conditions decided
in the law of that country for executing the decisions and the orders delivered
2. The execution order shall be requested before the court of first instance in which area
the execution is required, through the usual procedures of the action prosecution, and
it shall not be possible to order the execution before the verification of the following:
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a) That the state’s courts are not authorized to examine the litigation in which the
decision or the order has been delivered and that the foreign courts which have
delivered it are authorized therewith according to the international rules of the
judicial jurisdiction decided in their law.
b) That the decision or the order has been delivered from an authorized court
according to the law of the country in which it has been issued.
c) That the litigant parties, in the action in which the foreign decision has been
delivered, have been assigned to attend and have been properly represented.
d) That the decision or the order has acquired the power of the decided order
according to the law of the court which delivered it.
e) That it does not conflict with a decision or an order delivered previously from a
court in the state nor does it include what breaches the morals or the public order
therein.
Article (236)
The terms of the preceding clause shall be applied on the arbitrators’ decisions delivered
in a foreign country and the arbitrators’ decision should be delivered in a matter in which
it shall be possible to arbitrate according to the law of the state and should be liable to the
execution in the country which has delivered it.
Article (237)
1. The authenticated pieces in writing and the reconciliation reports which the courts
authenticate in a foreign country may have the order to be executed in the state under
the same conditions decided in the law of that country, in order to execute the similar
ones issued in the state of the United Arab Emirates.
2. The execution order referred to in the preceding clause shall be requested with a
petition submitted to the execution judge and it shall not be possible to order the
execution except after verifying the fulfillment of the conditions required for the
liability of the document or the report for execution according to the law of the
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country in which its documentation or authentication has accomplished, and verifying
that it is free from what breaches the morals and public order in the state.
Article (238)
The rules stipulated in the preceding clauses shall not breach the rules of the agreements
between the state and the other countries in this respect.

Chapter V. The Execution Procedures
Article (239)
1. The execution should be preceded by the notification of the executive documents
according to the notification procedures set in this law.
2. The notification paper should include a statement of the matter required and an
assignment to the debtor to settle the debt within fifteen days from its notification
date, and the allocation of an elected domicile for the execution requester in the area
of the court at which the execution shall proceed unless his original residence,
workplace or his elected domicile were therein.
3. If the executive document were issued according to a contract of opening a letter of
credit there should be notified therewith an extraction with the debtor’s account on the
basis of the creditor’s current account books.
4. In case of the execution with the evacuation of a real estate or delivering the movable
or real properties the notification of the executive document should include a
sufficient definition of those properties.
If the executive documents included an appointment of a date for the evacuation or
the delivery the notification should include that date.
Article (240)
1. If the debtor proposed to the execution agent, by the time of the executive document’s
notification or in any circumstance in which the procedures were, the settlement of the
sum to be executed or a part thereof, the agent should record that in the report and
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assign the debtor to deposit the sum proposed in the court’s case to the advantage of
the execution requester, and the deposit shall be accomplished on the same day or on
the following day at most.
2. If the offered item were a part of the debt the agent should continue in the execution
concerning the rest.
Article (241)
* As amended by Federal Law No. (30) dated 30/11/2005:
It is not allowed to the execution agent to break open the doors or to open the locks by
force in order to proceed the execution, except with the approval of the execution judge
and that shall be done in the presence of one of the policemen who should sign the
execution report otherwise it shall be void.
Article (242)
1. If the debtor has deceased or lost his capacity or the competence of the one who
undertakes the procedures in his place has extinguished before starting the execution
or before its accomplishment, the execution shall not be possible before his heirs or
before that who is in his place except after the expiry of eight days from the date of
notifying them with the execution document.
2. If the debtor has deceased or lost his capacity or the competence of the one who
undertakes the procedures in his place has extinguished after starting the execution,
the execution procedures shall be halted and all the dates which has been in operation
concerning him, until one of the execution parties shall urge them.
3. It shall be possible, before the expiry of three months from the death date, that the
notification, referred to in the two preceding clauses, shall be addressed to the heirs
altogether in the last residence in which their testator had resided, without listing their
names and capacities.
Article (243)
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It is not allowed to another to undertake what is required according to the execution
document nor to be obliged to undertake it, except after notifying the debtor with the
determination of such execution eight days, at least, before its occurrence.

Chapter VI. Objections to Execution
Article (244)
1. If a problem has been exposed during the execution and there was required therein a
temporary procedure, the execution agent may halt the execution or continue therein
by precaution, assigning the litigant parties, in both cases, to attend before the
execution judge, even with a date of one hour if necessary, and it shall be sufficient to
record the occurrence of such assignment in the report in what concerns the
prosecutor of the problem. In all circumstances, It shall not be possible for the
execution agent to accomplish the execution before the judge delivers his decision.
2. If the problem has been prosecuted with an action concerning the possession of a real
estate through the usual procedures of the action prosecution before the authorized
court, its prosecution shall result in the stay of the execution unless the court orders
otherwise.
3. The execution judge shall decide in the problem if it was prosecuted to him directly or
if it was submitted to the execution agent after notifying the parties of the executive
document and the problem’s prosecutor at a session appointed for that purpose.
4. The submission of any other problem shall not result in the suspension of the
execution, unless the execution judge decides the stay, and the terms of this clause
shall be also applied on the problems prosecuted after any substantive execution
litigation which is suspensive to the execution.
5. The terms of the preceding clause shall not be applied on the first problem exposed by
the obligated in the executive document if he hadn’t litigated in the previous
substantive problem or litigation.
Article (245)
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The real offer shall not result in the stay of the execution if the offer were disputed and
the execution judge may give orders to suspend the execution temporarily and to lodge of
the offered item or a sum of money exceeding its value which he would designate.
Article (246)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. If the judge has ruled the write-off of the lawsuit, the effect suspending the execution
as a result of the elimination of the lawsuit shall no more exist.
2. If the plaintiff loses the lawsuit that was suspending the execution, he may be subject
to a fine amounting to no less than AED 5,000 at most, without prejudice to the
indemnities if there were validly due.
Title Two. Sequestrations
Chapter I. General Provisions
Article (247)
* As amended by Federal Law No. (30) dated 30/11/2005:
Without prejudice to what stipulated in any other law, it shall not be possible to
confiscate the following:
1) The public properties owned by the state or to one of the emirates.
2) The house considered as a residence of the debtor or the convicted and, in case of his
decease, of those of his relatives who used to reside with him and whom he was
legally providing for.
3) What is needed for the debtor of clothes and what is necessary for him and his family
of the house furniture and the kitchenware, and what they need of food and fuel for a
period of six months.
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4) What the farmer or the fisherman owns of a land or agriculture tools needed therefore,
in proportion to what shall be sufficient to his livelihood and to those whom he
provides for.
5) The money donated or willed to be, themselves or their revenue, an alimony, or a
temporary or a life-time salary, and what the judiciary would decide of the amounts
set or arranged temporarily for the alimony or the disposition there from in a certain
purpose, and all that except with the amount of a quarter to settle the debt of an
established alimony.
6) The money donated or willed, provided it may not confiscated, and that if the
confiscator is one of the debtors of the grantee or the legatee whose debt had
originated before the donation or the will, except for a debt of an established alimony
and within one quarter.
7) What the debtor needs of books, tools and means to practice his profession or trade by
himself, unless the confiscation were for getting their price or their maintenance
expenses or an established alimony.
8) The movable which is considered a real estate by itemization, if the confiscation
thereon were independent from the real estate specified for its service, unless the
confiscation were for getting its price or its maintenance expenses.
9) The wages and salaries except with the amount of one quarter of the principal wage or
salary and when there is competition the priority shall be for the debt of alimony.
Article (248)
If the confiscation hasn’t been accomplished in one day it shall be possible to accomplish
it within one day or consequent successive days and the execution agent should undertake
what is necessary to preserve the confiscated items and the items needed to be
confiscated till the report has been accomplished, and the report should be signed
whenever the confiscation procedures stay.
However, if necessary, the execution agent shall continue the confiscation procedures
beyond the appointed times stipulated in Article (6) or during the official holidays, and he
may accomplish them without need to get a permission from the execution judge.
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Article (249)
It shall be possible, in any of the procedures circumstances, before the settlement of the
auction, to deposit a sum of money in the court’s case equal to the debts confiscated there
for and the expenditures.
Such deposit shall result in the extinguishment of the confiscation on the properties
confiscated and its transmission to the deposited sum.
Article (250)
The confiscated may request from the execution judge, in any of the procedures
circumstances, the estimation of a sum of money or what shall be equivalent thereto to
deposit in the court’s case as a guarantee of settlement to confiscator.
That deposit shall result in the extinguishment of the confiscation on the confiscated
properties and its transmission to what has been deposited.
Article (251)
* As amended by Federal Law No. (30) dated 30/11/2005:
The confiscation shall be inflicted within the debt claimed. If the value of the right
confiscated there for were not proportional to the value of the confiscated properties the
debtor may request the execution judge to to limit the confiscation to some of those
properties.

Chapter II. Sequestration
Article (252)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
Without prejudice to any provisions of any other law, the creditor may request from the
court which examines the action or from the judge of summary matters, according to the
circumstances, to impose provisional attachment on the real properties and the movables
of his adversary in the following circumstances:
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1) Each case in which he would be afraid to lose the security of his right, as the
following cases:
a) If the debtor is not a settled resident of the State;
b) If the creditor was afraid that the debtor escapes, smuggles his money or hide it;
c) If the securities of the debt were at risk of being lost.
2) To the lessor against the original lessee and the sub-lessee on the movables, fruits and
yields existing in the leased premises, as a guarantee for the lien to which he is
entitled according to the law, and that shall also be allowed to him, if the movables,
fruits and yields were transferred without his knowledge, unless thirty days have
lapsed since their transmission, or assets sufficient to secure the lien prescribed for
him have remained in the leased premises.
3) If the creditor was bearer of an official document or ordinary debenture for an
unconditionally payable debt.
4) In all circumstances, the court may, before responding to the attachment request,
require any information or affidavits when it finds that necessary.
Article (253)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
The owner of a movable property and whoever has a real right related to it or a right to
withhold same may request the imposition of provisional attachment on such property
with the party holding it, by virtue of a memorandum containing sufficient details on the
property to be subject to attachment.
Article (254)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. Should the debtor not have any writ of execution or should the value of his debt not
be specified, the magistrate of summary justice may order the imposition of
sequestration and temporarily estimate the sequestrator’s debt based on a wellgrounded
petition submitted by the sequestration applicant. Before issuing the order,
the judge may carry out a summary investigation should he deem that the documents
supporting the application are insufficient.
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In case of sequestration of a real estate, a certified copy of the real estate’s title deed
shall be submitted with the petition.
2. The magistrate of summary justice shall order sequestration if the debtor has obtained
a judgment even if it was inapplicable, should the value of debt be specified.
3. If the lawsuit was previously filed before the competent court, the sequestration order
mentioned in the first paragraph may be requested from the court that is hearing the
case.
Article (255)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. The rules and procedures stipulated in section four of this chapter shall be followed in
the precautionary confiscation on the movables, except what is concerning the
appointment of the sale day, unless if the movables were subject to damage, then the
stipulation of the second clause of Article (280) shall be taken into consideration.
The rules and procedures stipulated in chapter six of this book shall be followed in the
precautionary confiscation on the real estate, except what is concerning the
submission of the executive document and the procedures of the sale by auction.
2. The confiscator – within eight days, at most, from the date of inflicting the
confiscation – should prosecute before the authorized court the action with the
confirmation of the right and the validity of the confiscation, and that in the
circumstances in which the confiscation has been undertaken by the order of the judge
of the summary matters otherwise the confiscation shall be null and void.
3. If the action for the right was previously prosecuted the action for the validity of the
confiscation shall be submitted to the same court so that it can examine both of them.
4. If a decision with the validity of the confiscation has been delivered and it was due of
execution or has become so, the procedures set for the sale shall be followed as in
chapters four and six of this book, according to the circumstances, or the execution
shall be proceeded through the delivery of the movable in the case mentioned in
Article (253).
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Article (256)
1. If the lesser of the real estate has inflicted the confiscation on the movables of the
sublessee according to the second clause of Article (252), the procedures should be
directed to both the principal lessee and the sublessee.
2. The notification to the sublesse shall also be considered as a confiscation under his
hand on the rent.
3. If the principal lessee were not prohibited from the sublease the sublessee may request
the release of the confiscation off his movables while the confiscation remains under
his hand on the rent.

Chapter III. The Garnishment of the Debtor’s Property in the Hands of Third
Parties
Article (257)
1. Each creditor may request from the authorized court or from the judge of the
summary matters the confiscation on what his debtor has with the others of movables
or debts even if they were delayed or suspended under a condition.
2. If the confiscation were not inflicted on a movable or on a debt in itself, it shall
include all that the confiscated has of movables in the garnishee’s hand and the debts
in his patrimony till the time of reporting what is in the patrimony.
3. The confiscation on what the debtor has with the others shall be inflicted on the
debtor’s movables which have been under the control of his legal representative.
Article (258)
If the creditor had not in his possession an executive document or his debt was of an
indefinite value, the court of the summary matters may order the confiscation and the
confiscator’s debt shall be estimated temporarily and that shall be on the basis of a
petition submitted by the confiscation requester, and the judge of the summary matters
should order the confiscation if there were in the creditor’s hand a decision, even it were
not due of execution, whenever the debt stipulated therein is of a definite amount.
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Article (259)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
The provisional attachment shall be imposed, with no need to a prior notification to the
debtor, by virtue of an order issued by the judge. The order shall be notified to the
garnishee with the knowledge of the enforcement officer, and it shall include the
following information:
a) A statement of the principal sum for which the attachment has been imposed in
addition to the expenditures.
b) A clear specification of the sequestrated thing if the attachment covers a certain
property and the garnishee fails to pay or deliver the property owed.
c) The number of the lawsuit or the attachment application, the sequestrator’s name,
domicile and workplace in the State. Should he have no domicile or workplace in the
State, he shall elect a domicile at the district of the court wherein execution is taking
place.
d) The order imposing upon the garnishee to determine the property owed and a
statement from the court that imposed attachment, within 14 days from the date on
which the attachment notice is served.
Article (260)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
Should the order not include the information mentioned in Clauses (a) and (b) of Article
(259) the sequestration shall be deemed null, and every concerned party shall adhere to
such nullity.
Article (261)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. The confiscation should be notified to the confiscate after being notified to the
garnishee, and the notification shall be accomplished through a declaration including
the confiscation occurrence, its date, and the statement of the judge’s order according
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to which the confiscation is to be occurred, the sum of money for which the
confiscation is to be occurred, the confiscated money, the confiscator’s name, his
residence, his workplace in the state, and if he had not a residence or a workplace in
the state he should determine an elected domicile for him in the area of the court in
which the execution shall be proceeded.
2. The confiscator should, within the eight days following the confiscation notification
to the garnishee, prosecute against the confiscate before the authorized court the
action of the stipulation of the right and the validity of the confiscation, and that shall
be in the circumstances in which the confiscation has been issued by the order of the
judge of the summary matters otherwise the confiscation would be as it were not
exiting, and the court shall not decide that automatically, and if the action for the right
were prosecuted previously the action of the validity of the confiscation shall be
submitted to the court in order that it can examine both of them together.
Article (262)
1. The payment from the garnishee shall be by lodging what he has in his patrimony into
the court’s case, and if the object of confiscation were movables which are impossible
to lodge in that case, it shall be possible to deliver them to a judicial receiver whom
the authority ordering the confiscation would assign according to a request submitted
thereto from the garnishee or the confiscate.
2. The lodging should be attached to a statement signed by the garnishee with the
confiscations which were conflicted under his hands, their notification dates, the
names of the confiscators and the confiscate and their capacity, their addresses, the
documents according to which the confiscations have been inflicted and the sum of
money for which the confiscation have been inflicted.
3. The authority ordering the confiscation should immediately inform the confiscator
and the confiscate with the lodging occurrence or the placement of the movables in a
judicial receiver’s hand.
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4. The lodging or the placement of the movables under the receivership shall dispense of
(be a substitute for) reporting what in the patrimony if the sum of money or the
movable were sufficient for the payment of (for) the confiscator’s debt.
5. If a new confiscation has been inflicted on the sum lodged or the movables placed
under the receivership so that any of them has become insufficient it shall be possible
to any of the confiscators to assign the garnishee to report what he has in his
patrimony within seven days from the day of his assignment therewith.
Article (263)
1. If the lodging has not occurred according to the preceding Article or theِ Articles
(249) and (250), the garnishee should report what he has in his patrimony to the
authority ordering the confiscation within seven days from his notification with the
confiscation, and he shall mention in the report the debt’s amount, its reason and the
reasons of its termination, if there were any, and if there were under the garnishee’s
hand movables he should attach to the report a detailed list thereabout.
2. If the confiscation were under the hand of the government, or one of the public
foundations, one of the public associations or one of the banks, the report with what is
in the patrimony shall be submitted through a letter sent, with the report’s information,
by the authority at which the receivership takes place to the authority ordering the
confiscation in the date mentioned above.
3. The garnishee shall not be exempted from the commitment of reporting what is in the
patrimony if he were not indebted to the confiscate, by then it shall be possible to
accomplish the report with a statement submitted by the authority which has ordered
the confiscation. Moreover, the proficiency shall not exempt him from the
commitment of reporting what is in the patrimony.
Article (264)
If the garnishee has died or has lost his capacity or his competence or the competence of
that who represents him has extinguished, the confiscator may notify the heirs of the
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garnishee, or whoever in his place, with a copy of the confiscation paper and he shall
assign them to report what is in the patrimony within seven days from such assignment.
Article (265)
The action of the litigation in the report of the garnishee shall be prosecuted before the
authority which has ordered the confiscation.
Article (266)
1. If the garnishee hasn’t stated what he had in his patrimony in the manner legally set or
has submitted an insufficient report or has stated other than the truth, or concealed
papers he should have deposited in order to confirm the report, it shall be possible to
inflict on him, to the advantage of the creditor who has obtained an executive
document of his debt, the sum for which the confiscation had occurred and that shall
be through an action prosecuted with the usual procedures.
2. The execution of the decision delivered against the garnishee shall be considered a
payment to the confiscator’s right on the part of the confiscate, and that shall be
without prejudice to the garnishee’s claim to the confiscate with what he has paid to
the confiscator.
3. The decision shall not be delivered if the garnishee has redressed the reason for which
the action had been prosecuted until the closure of the defense therein even before the
appellate court.
4. The garnishee should be, in all circumstances, committed to pay the action
expenditures and the indemnities resulting from his failure or his delay.
Article (267)
Should the right of the confiscator be proven by virtue of an executive deed, he shall be
entitled, 10 days subsequent to the date of the report, to request from the execution judge
the issuance of an order against the garnishee to pay to the confiscator the sum
acknowledged thereby or the sum paid therefrom to the confiscator, provided that
procedures set in Article (243) are observed.
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Article (268)
If the payment hasn’t occurred according to the preceding Article nor the lodging
according to the articles (249), (250) and (262) the confiscator may levy execution on the
properties money of the confiscate on the basis of an executive document attached to an
official copy of the garnishee’s report, taking into consideration what is stipulated in
Article (239).
Article (269)
If the confiscation were on movables sold through the procedures set for selling the
confiscated movable which the debtor had, and if the confiscated were not a debt due of
payment it shall be sold through the procedures stipulated in Article (291).
Article (270)
1. The creditor may confiscate, under his own authority, what he was indebted to his
debtor and that shall be by an order, from the authorized judge, which shall be
notified to the debtor including the information that should be mentioned in the paper
of the confiscation delivery.
2. If there were not, in the confiscator’s hand, an executive document or a decision, he
should, within the eight days following the notification to the debtor with the
confiscation, prosecute before the authorized court the action of the confirmation of
right and the validity of the confiscation otherwise the confiscation shall be
considered null and void.

Chapter IV. The Confiscation of the Movable With the Debtor
Article (271)
* As amended by Federal Law No. (30) dated 30/11/2005:
1. Taking into consideration what is stipulated in Article (241) of this law, the
confiscation shall be proceeded on the basis of a report written at the confiscation
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place, and it should include, beside the information that should be mentioned in the
notification papers, the following:
a) Mentioning the executive document.
b) Mentioning the confiscator’s residence or his workplace in the state, but if he had
not a residence or a workplace in the state he should designate an elected domicile
for him in the area of the court in which the execution shall be proceeded.
c) The confiscation place, the procedures which the execution agent has undertaken,
the obstacles and objections he has faced during the confiscation and what he has
undertaken about them.
d) The items confiscated in details mentioning its type, description, amount, weight
or dimensions and a list of their approximate value.
2. The execution agent and the debtor, if he were present, should sign the confiscation
report, and in case of his abstention to sign the execution agent shall record that in the
confiscation report, and just the debtor’s signature shall not be considered an approval
from him on the decision.
3. The confiscation shall not require moving the confiscated items from its places except
by the order of the execution judge.
4. The items shall become confiscated just by mentioning them in the confiscation report
even if a judicial receiver were not appointed for them.
5. If the confiscation has occurred in the presence of the debtor or in his residence or in
his workplace a copy of the report shall be delivered to him or to whoever receives it
instead of him, and that as stipulated in Article (8), but if the confiscation has
occurred in his absence or in other than his residence or his workplace he should be
notified with the report, personally or in his residence or his workplace, and that
within, at most, the seven days following the confiscation.
Article (272)
1. If the confiscation were on trinkets, on molds of gold, silver or of other precious
metal, on jewels or precious stones they should be weighed and described thoroughly
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in the confiscation report, and such items shall be evaluated by an expert appointed by
the execution judge according to the request of the execution requester.
2. It shall be possible, in the same way, to valuate the other artistic and precious items
according to the request of the confiscator or the confiscate, and in all circumstances,
the expert’s report shall be attached to the confiscation report.
3. If there is need to move them in order to be weighed or evaluated they should be
placed in a sealed shelter mentioning that in the report with the description of the
seals and they shall be placed in the court’s case.
4. If the confiscation has been inflicted on money or money bills the execution agent
should mention its description and amount in the report and deposit it in the court’s
case.
Article (273)
1. The execution agent shall assign a judicial receiver for the confiscated items, and he
shall choose a capable person as a receiver if the confiscator or the confiscate hasn’t
come, and the confiscate should be assigned, if he himself has requested that, except
if there were fear from the wastefulness and there were good reasons thereof to be
mentioned in the report, in such case, the opinion of the confiscate shall be taken
about those reasons and they shall be exposed immediately to the execution judge to
undertake his decision therein.
2. If the execution agent hasn’t found in the confiscation place someone to accept the
receivership and the debtor was present, the receiver shall assign him for the
receivership and his refusal thereof shall not be considered, however, if the debtor
were not present the receiver should take all the possible precautions to preserve the
confiscated items and bring that matter immediately before the execution judge in
order that he would give orders to either move or lodge them with a faithful who
accepts the receivership and whom the confiscator or the execution agent choose or to
assign temporarily the police for the receivership.
Article (274)
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1. If the receiver were present during the confiscation the confiscated items shall be
delivered to him in its confiscation place after putting his signature on the
confiscation report and delivering him a copy thereof, and if he were absent or has
been assigned after that the confiscated items should be inventoried and delivered to
him after signing on the inventory report and delivering a copy thereof.
2. If the receiver abstained from signing on the confiscation or the inventory report or
refused to receive his copy the execution agent should substitute him with another
receiver otherwise he should expose the matter to the execution judge immediately in
order that he can decide what he would think appropriate.
Article (275)
The receiver who is not a debtor or the receiver who is a possessor shall deserve a wage
for his receivership and such wage shall have the privilege of the judicial expenditures on
the movables confiscated.
The receiver’s wage shall be estimated by an order issued by the execution judge.
Article (276)
1. The receiver shall not be allowed to use the confiscated items, nor exploit, lend, nor
expose them to damage otherwise he shall be deprived from the receivership.
2. If the confiscation were on livestock, bids, tools, or equipment needed for the
operation or the exploitation of a land, factory, workshop, foundation or what is
similar the execution judge may, on the basis of a petition submitted to him by one of
the concerned parties, order the receiver with the operation or the exploitation if he
were competent for that or substitute him with another receiver to do that.
Article (277)
1. It is not allowed that the receiver would request his exemption from the receivership
before the day appointed for the sale except because of reasons necessitating that, and
his exemption shall be in effect by an order on a petition issued by the execution
judge.
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2. The execution agent shall inventory the confiscated items when the new receiver
assume his task and he shall write a report thereof signed by that receiver and shall
receive a copy thereof.
Article (278)
1. If the execution agent went to confiscate movables which were previously confiscated
with the debtor the receiver should show him the copy of the confiscation report and
submit the confiscated items and the execution agent should inventory them in a
report and confiscate what hasn’t been confiscated before and should assign the
receiver of the first confiscation a receiver on them, if there were at the same place.
2. Such report shall be notified, within three days at most, to the first confiscator, the
debtor and the receiver if he were not present, and it shall also be notified to the
authority which has ordered the first confiscation.
3. Such notification shall result in the continuation of the confiscation for the benefit of
the second confiscator even if the first confiscator has sequestered it, and it shall be
considered a confiscation under the control of the execution agent on the sums of
money collected from the sale.
4. If the first confiscation on the movables were void, that shall not influence the
confiscations following it if they were valid in themselves.
Article (279)
1. After accomplishing the confiscation the sale day, its hour and its place shall be
appointed with the acknowledgment of the execution judge taking into consideration
the terms of Article (280).
2. The execution agent should, right after that, affix on the door of the place in which the
confiscated items existed, and also with the signs prepared for that by the court, an
announcement showing the sale day, hour and place, the type of the confiscated items
and its overall description, and the occurrence of that shall be mentioned in the report
attached to the confiscation report.
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3. The execution judge may give orders to announce that in one of the daily news paper
issued in the state in Arabic or through other media channels.
He may also, according to the request of the confiscator or the confiscate, permit to
exceed the means of announcement and publication at the expense of the requester,
and he may also give orders with that, on his own, deducting it from the sale revenue.
4. The affixing shall be proved by mentioning it in a special record prepared for that by
the court, and the publication shall be proved by submitting a copy of the news paper
or a certificate from the announcement authority.
Article (280)
1. The sale shall be proceeded in the place in which the confiscated items exist or in the
place specified with the acknowledgment of the execution judge for selling the
confiscated items, unless the interest would necessitate otherwise. Its procedure shall
be after eight days, at least, form the date of delivering the copy of the confiscation
report to the debtor or the date of notifying him therewith, and after three days at least
from the date of accomplishing the posting or the publication procedures, and
whoever wants to examine the confiscated items within the mentioned period shall be
allowed to.
2. However, if the confiscated items were subject to damage or they were goods subject
to price fluctuation, the execution judge may give orders to proceed the sale in the
place he would decide, and from one hour to another according to the circumstances,
and that on the basis of a request submitted to him from the receiver or one of the
concerned parties or the execution agent.
Article (281)
If the sale hasn’t occurred on the day appointed in the confiscation report it shall be
appointed on another day with which the receiver and the concerned party shall be
notified, and the posting and the publication shall be redone as mentioned in the
preceding articles.
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Article (282)
1. The sale shall be proceeded by the public auction under the supervision of the
execution judge with the execution agent’s calling, on the condition that the price shall
be immediately paid, the execution agent should not start to sell except after the
inventory of the confiscated items and recording its condition in the sale report, and
he shall record in all the sale procedures what he has found as objections and
obstacles and what he has undertaken therein, he should also record the presence of
each of the confiscator and confiscate or their absence and the signature of each if he
was present or his abstention to sign.
2. The execution agent should list in the report the names of the bidders, the residence of
each and his workplace, the prices offered from them and their signature.
The report shall particularly include the statement of the price which the auction has
come eventually to and the name of the successful, his residence, workplace and
signature.
3. For announcing the continuation of the sale or its postponement it shall be sufficient
that the execution agent mentions that in public and record it in the sale report.
Article (283)
If no one has come to purchase the trinkets, the golden or silver molds, the jewels, the
gems or the precious stones and the items estimated with their values according to the
experts’ valuation, and the creditor hasn’t accepted the settlement of his debt in rem with
that value, its sale date shall be extended to the following day, if it were not a holiday, or
to the first working day after the holiday, and if no purchaser has offered the value
estimated the sale shall be postponed to another day and the posting and publication shall
be redone as mentioned in the preceding articles, by then the execution agent shall expose
the matter before the authorized judge to order that the auction lands with the price which
he finds appropriate even if on another date.
Article (284)
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If the successful in the auction the price immediately, the sale should be redone on his
responsibility in the way mentioned, at any price and he shall be committed with what
has been reduced from the price and the execution report shall be an executive document
of the price different concerning him.
Moreover, he shall not have the right in the increase of the price, rather the debtor and his
creditors shall deserve it, and the execution agent shall be committed with the price if he
hasn’t received it immediately from the purchaser and he hasn’t taken action to redo the
sale on his responsibility, and the execution report shall be an executive document
regarding him.
Article (285)
The execution agent shall stop the proceeding in the sale if a sufficient sum of money has
resulted out of it for the payment of the debts for which the confiscation was executed
and the expenditures, as for any confiscations inflicted after that under the control of the
execution agent or under the control of any of those who had the price in their possession,
they shall not treated except with what exceed the payment of the mentioned items.
Article (286)
The action for restoring the confiscated items shall be prosecuted before the authorized
court and the prosecution of such action shall result in the stay of the sale unless the court
has decided the execution continuation on the conditions it finds appropriate.
Article (287)
The action of the restoration should be prosecuted against the creditor, confiscator and
confiscate and intervening confiscators and its initiatory pleading should include an
adequate manifestation of the ownership proofs.
The prosecutor should deposit, when he submits the initiatory pleading, the documents he
may have.
Article (288)
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1. The confiscator has the right to proceed in the execution if the court has decided to
drop the action of restoration or if it has considered it null and void, or it has been
decided to consider it so.
He has also the right to proceed in the execution if the court has decided the action
rejection, its lack of jurisdiction, its disapproval, the nullity of its initiatory pleading,
the extinguishment of the dispute therein, or the approval to abandon it.
2. The confiscator shall proceed in the execution even if the terms mentioned in the
preceding clause were subject to the appeal.
Article (289)
1. If another action of restoration has been prosecuted by the restorer, and his first action
has been considered as not existing or the court has decided to consider it so, or
decided its rejection, its disapproval, the court’s lack or jurisdiction, the nullity of its
initiatory pleading, the extinguishment of the litigation therein, or the approval to
abandon it, the sale shall not be halted unless the authorized court has decided its stay.
This rule shall be applied if the action of restoration has been renewed after dropping
or halting it.
2. The same rule shall also be applied if a second action of restoration has been
prosecuted by another restorer, and the action shall be considered a second action
since it has been next in its prosecution date even after the extinguishment of the
effect halting the sale caused by the prosecution of the first action.

Chapter V. Seizure of Stocks, Bonds, Revenues and Shares
Article (290)
1. If the shares or bonds were to bearer or endorsable their confiscation shall be through
the proceedings set for the confiscation of the movable with the debtor or with the
others.
2. The confiscation of the arranged revenues, the nominal shares, the shares of profits
due in the patrimony of the legal personalities and the rights of the testators in the
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companies shall be through the proceedings set for the confiscation of what the debtor
has with the others.
Their confiscation shall result in the confiscation of their profits till the sale day.
Article (291)
The shares and bonds and the others which have been mentioned in the preceding Article
shall be sold by the public auction, according to the procedures stipulated in Article (279)
and what is beyond it, under the supervision of the execution judge.

Chapter VI. Seizure and Sale of Real Estate
Article (292)
1. The confiscator shall submit to the execution judge a confiscation request on the real
estate, attached with the executive document, and a copy of its notification to the
person on which the confiscation is required and with his commitment to pay
applying the stipulation of Article (239) and an official copy of the deed of the estate
required to be confiscated.
The request shall include the following information:
a) The requester’s name, his title, profession, residence, workplace, and his elected
domicile in the area of the court in which the execution shall be proceeded if he
hadn’t a residence or a workplace therein.
b) The name of the person required to be confiscated, his title, profession, residence
and workplace.
c) The description of the real estate required to be confiscated with a report of its
location, area, boundaries, or its number and region and any other information to
help designate it according to what is established in the official land registers
prepared for that.
2. The creditor may procedure with a petition an order from the execution judge with an
authorization to get in the real estate, to obtain the information needed for describing
it and designating its contents.
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And it shall not be allowed to complain about that.
Article (293)
1. If the execution judge has considered that the confiscation request on the real estate
has met its legal conditions he shall issue his decision with the confiscation and order
the execution agent to go, on the following day at most, to the authorized area to
register the real estate in order to endorse the decision officially in the land registers.
The registration shall include the appointment of its date and hour.
2. The registration of the confiscation decision shall result in the considering the real
estate confiscated.
3. The execution agent should obtain an official list authorized from the real estate
register, with the creditors who have the registered rights, the residence of each one of
them, his workplace.
Article (294)
1. The execution agent shall undertake, within seven days from the confiscation, the
notification of the debtor, the tenant, the real estate bondsman with a copy of the
confiscation request, after endorsing it officially with what proves its registration.
2. He shall also proceed, within the same date, to notify with that report the creditors
who have the registered rights mentioned in the preceding article, and those creditors
shall be, as soon as they have been notified, parties as confiscators in the procedures,
and the notification, when any of them has deceased, shall be addressed to his heirs
altogether in the residence designated in the register if a period of six months at most
hasn’t passed since the decease.
Article (295)
1. The execution judge, before undertaking the real state sale through the auction, should
notify the debtor to pay the debt within a month from the notification date otherwise
the real estate would be sold by auction, and the debtor may request within such date
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the postponement of the sale and the execution judge may respond to the request in
the two following cases:
a) If the real estate’s revenues within a period of three years were sufficient for
settling the debt, the profits, the duties and the expenditures, and the execution
judge may, in such case, assign the creditor, under his supervision, to collect the
real estate’s revenues till the full settlement, and if something incidental has
occurred to prevent the creditor from getting his rights on a regular basis the
execution judge should, on the basis of the creditor’s request, continue the
procedures of the real estate’s sale.
b) If the real estate’s revenues within a period of three years were not sufficient to
settle the debt, profits, fees and the expenditures and the debtor had other
revenues which were sufficient in addition to the real estate’s revenue to settle the
debt by installments within such period and the execution judge has realized that
selling the real estate would cause the debtor a big loss he may decide the
postponement of the sale with paying the debt in installments within a period not
exceeding the period mentioned and that with the guarantees which he considers
appropriate, and if the debtor has failed to pay one of those installments, the
execution judge, on the basis of the creditor’s request, should continue the
procedures of the real estate’s sale.
2. If the notification time-limit stipulated in the preceding clause has elapsed and the
debtor hasn’t paid or hasn’t submitted a request to postpone the sale or has refused
such request the execution judge should appoint the sale location, day, and period in
which the auction shall be proceeded.
3. The execution judge shall assign, before the announcement of) the sale, an expert or
more to estimate the real estate’s price within an extra period of time not exceeding
thirty days from the date on which the judge assigned him for the task.
4. The case management office should notify each of the debtor, the owner and the legal
bondsman with the sale location, day, the period in which the auction shall be
proceeded and also with the announcement of the sale before the day appointed to
proceed in it with a period not exceeding thirty days and that shall be through
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publication in two daily news papers issued in the state and one copy of the
announcement shall be posted in a noticeable place of the real estate and the other on
the court’s bulletin board.
Article (296)
1. The announcement of the sale shall include the following information:
a) The name of each of the confiscator, the debtor, the owner or the legal bondsman
and his title, profession, residence and workplace.
b) The statement of the real estate according to what has been stipulated in the
confiscation decision.
c) The sale conditions and the principal price which the expert has designated, the
expenditures and the insurance which the purchase requester has to pay in
advance, provided it should not be less than 20% of the principal price.
d) The declaration of the court before which the sale shall be proceeded, the
auction’s day and the period within which the auction shall be proceeded.
2. It shall be possible to the confiscator, the debtor, the owner, the legal bondsman and
each one who has interest to get a permission from the execution judge for the
publication of other sale announcements in the news papers and other media channels
because of the importance of the real estate or its nature or for any other cases, but
augmenting the publication shall by no means result in the delay of the sale, and it
shall not be possible to complain against the judge’s decision concerning this.
Article (297)
1. If the real estate set forth for sale were divisible and the part of such real estate –
according to the expert’s report – were sufficient to settle the debt, its profits, the fees
and the expenditures the execution judge should partition that part setting it forth in
the auction and exclude the other parts, and if it has become clear, as a result of the
auction, that the equivalent presented in this part of the real estate were not sufficient
for the settlement, the execution judge should set forth the rest of the real estate or any
other additional part thereof which shall be sufficient for the settlement.
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If the payability action has been prosecuted in a part of the real estate set forth for
auction and the court has decided to postpone the auction, then such decision would
not necessitate the auction postponement for the rest of parts unless the shares,
according to the experts’ estimation, were not divisible, by then the auction delay
should be for the rest of shares.
2. If there were many real estates needed to be sold by auction each real estate shall be
separately set forth for sale unless the execution judge – after taking the experts’
opinion – has found out that it shall be beneficiary to sell more than one real estate or
all the real estates in one auction.
Article (298)
It is not possible to sell the real estate except to a citizen, and that by taking into
consideration the rules related to the devolution of the real estate ownership.
Article (299)
1. The disposition of the debtor, tenant or the legal bondsman of the real estate shall not
be executed nor what would be consequent thereto of mortgages or prerogatives to the
right of the successful in the auction if the disposition, the mortgage, or the
prerogative has been registered after the registration of the confiscation decision.
2. The real estate shall be subjoined by its profits and revenues for the period following
the registration of the confiscation decision, and the revenue, the fruitage price and
the harvest shall be deposited in the court’s case, and if the real estate were not rented
the confiscate shall be considered a bondsman till the sale is accomplished and if the
real estate were rented the rent payable for the period following the registration of the
confiscation request shall be considered confiscated under the control of the tenant as
soon as he has been obliged by the confiscator, or any creditor bearing an executive
document, not to pay it to the debtor.
If the tenant has paid the rent before such obligation it shall be legal to pay him and to
ask the confiscate, being in the capacity of a bondsman, about it.
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Article (300)
1. If the real estate was surcharged with a real estate guarantee and was reverted to an
owner with a registered contract before the confiscation, then the owner should be
warned before the confiscation request to pay the debt or to evacuate the real estate
otherwise the execution shall be proceeded against him.
2. The warning shall include, beside the general information in the announcement
papers, and the obligation for payment or the evacuation, the following information:
a) The executive document.
b) The debtor’s notification and commitment to pay according to Article (239).
c) The statement of the real estate object of the execution according to what is
stipulated in the official records prepared for that.
3. The warning mentioned above shall also be addressed to the mortgagor in the
circumstances in which the execution is to be proceeded on a mortgaged real estate
without the debtor.
4. The warning notification to the right of the notified shall result in all the rules
stipulated in the preceding article.
Article (301)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The concerned parties should present the invalidation grounds in the notice mentioned
in Articles (294) and (295) by a request submitted to the execution judge three days at
least before the session set for the sale otherwise the right to present them lapses.
2. The execution judge shall decide upon the aforementioned invalidation grounds on
the day specified for the sale. The decision issued by said judge may not be contested
by any method. If the notice serving procedures are decided to be invalid the sale shall
be postponed to a day specified by the judge, and the procedures shall be repeated.
3. If the invalidation request is decided to be rejected, auction shall be decided to be
carried out immediately.
4. The creditor, the possessor, the surety and the debtors referred to in Article (293) shall
present the other invalidation grounds related to the procedures preceding the sale
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session, as well as the grounds of objection against the sale conditions, 10 days at
least before the date of said session, otherwise the right to present same lapses. Said
grounds shall be presented by virtue of an application submitted to the competent
execution judge. The latter shall rule, based on the aforementioned application, either
the suspension or the continuation of sale, depending on the extent of seriousness of
such grounds. If the judge rules the continuation of sale, auction shall take place
immediately.
Article (302)
The creditor should, before the beginning of the auction procedures, deposit a sum of
money which the execution judge estimates for covering the charges and the expenditures
of the real estate sale including the equivalent of the legal profession fees. That sum shall
be deduced from the real estate price and repaid to the creditor.
Article (303)
1. The execution judge shall undertake, on the day appointed for the sale, the auction
procedure, and it shall not be possible to proceed it except after issuing the decision
according to which the final execution shall occur.
2. If one purchaser, or more, has come to the first sale session the execution judge shall
approve, at the end of the period appointed for the auction, the highest offer (bid),
provided that it shall not be less than the principal price which the expert has
designated with the expenditures, and if the bid were less than that or no purchaser
has come to that session the execution judge shall decide the postponement of the sale
to the following day in the same place and in the date appointed for the auction, and if
no purchaser has come to the second session with the principal at the session with the
principal price the judge shall postpone the auction to the following day reducing the
principal price with 5% each time. If the total of the deduction from the price has
reached 25% the sale should be postponed for a period of subsequent three months
redoing the announcement procedures, and in such case, the real estate shall be sold
with the highest offer whatever its value was.
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Article (304)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The party whose bid is accepted by the execution judge shall deposit, within ten days
following the sale session, the full price accepted and the expenditures. In case the
price is paid by said party, the judge shall rule awarding the auction to him.
2. Should the successful bidder fail to pay the price in full, the execution judge shall
offer the real estate to the following bidder at the price proposed thereby. Should he
accept, the judge shall accept his bid and he shall deposit the price within the period
specified in Paragraph 1. However, should the following bidder reject the offer, the
execution judge shall repeat the auction within 15 days and with the same procedures,
then the judge shall rule awarding the auction to the highest bidder.
3. Every person who is not prohibited from bidding may increase the price, within 10
days following the date on which the auction was awarded, provided that such
increase is equal to one tenth of the price at least. In such case, the bidder shall
deposit the full price offered along with the expenses at the court treasury. In such
case the auction shall be repeated within 7 days. Should no higher bid be offered, the
judge shall rule awarding the auction to said person.
4. The bidder who fails to pay the amount owed shall be bound to pay the lacking
amount of the real estate price. The auction awarding ruling shall include imposing
upon the party who fails to pay amount owed to pay the price difference if any. He
may not be entitled to any price increase but it shall be rather received by the debtor,
possessor or surety as the case may be.
5. In all cases, the provision of a guarantee from an accredited bank in the State or the
provision of a payable cheque shall have the same effect of deposition. In case the
depositor is a debtor and the value and degree of his debt justify his exemption from
deposition, the judge shall exempt him from depositing a part or all of the amount,
including the price and the expenditures, imposed by the law.
6. It may not be stipulated otherwise in the sale conditions in any case whatsoever.
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7. If, for a reason not involving the purchaser, it was impossible to complete the
procedure of sale and registration, at the auction value, within 30 days from the date
on which the auction is awarded, the purchaser may request termination of the auction
and recovery of the cash amount paid. When such request is accepted, the execution
judge shall repeat the auction.
8. At any time prior to the completion of the procedure of transfer of ownership and
registration of the real estate for the purchaser as a result of the auction, the debtor
may pay the debt, interests, fees and expenses or sell the real estate with the approval
of the execution judge and under his supervision at a higher price and with an increase
equal to no less than 10% of the price at which the auction was awarded.
Article (305)
If the auction has been late for a legal reasons or for the creditor’s failure to pursue it then
the auction should be redone for a period of fifteen days, but if it has been abandoned for
a period of six months or more, then the auction should be redone again and the
preceding delays shall be cancelled.
Article (306)
1. The decision of the auction landing shall be delivered with the preamble of the rules
of the law, and it shall include a copy of the request of the confiscation on the real
estate, a statement of the procedures followed in its concern, and in the sale
announcement, and a copy of the minutes of the sale session, and its statement shall
include the order to the debtor, tenant, legal bondsman to deliver the real estate to
whom the auction landing has been decided.
The decision’s original copy should be deposited in the case’s file, on the day
following its delivery.
2. This decision shall not be declared, and its execution shall be proceeded obligatorily
by committing the debtor, the tenant, the legal guarantor or the bondsman, according
to the circumstances, to be present at the delivery location on the day and at the hour
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appointed for its proceeding, provided that the announcement thereof shall occur two
days, at least, before the day appointed for the delivery.
3. If there were in the real estate movables to which a right had been suspended to other
than the confiscate, the execution claimer should request with a petition from the
execution judge, the undertaking of the procedures needed for preserving the rights of
the concerned parties. He may also hear the concerned parties, whenever there’s a
need, before delivering his order.
Article (307)
1. It shall not be possible to appeal against the decision of the person proceeding the
auction landing, unless there were a defect in the auction procedures, in the decision
form, or for its delivery without halting the procedures when their stay is a legal
obligation.
2. The appeal shall be prosecuted through the usual proceedings within seven days from
the date of pronouncing the decision.
Article (308)
1. The execution judge, on the basis of the concerned parties’ request, should ask the
administration responsible of the real estates registration to register the decision of the
auctioneer (the successful in the auction), after the one who was decided as successful
in the auction has deposited the full price, unless he was exempted from the deposit,
and the rules set in the real estate registration shall be applied on the decision
registration.
2. This registration shall result in the refinement of the sold real estate from the
prerogative rights, the insurance and ownership guarantees which their possessors
have been declared according to Article (293) and it shall be remaining only their
right in the price.
Article (309)
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1. The other parties may request the nullity of the execution procedures with the request
of the payability of all or part of the confiscated real estate and that shall be by an
action prosecuted through the usual procedures before the authorized court at which
the confiscator creditor and the creditors referred to in Article (293), the debtor and
the tenant or the legal bondsman shall litigate in such action. The court shall decide at
the first session the stay of the sale procedures if the action’s initiatory pleading has
included an accurate statement of the ownership evidences or the merits of the
tenancy on which the action has been based and to which the documents supporting it
has been attached.
2. If the day appointed for the sale has come before the court’s decision to stay the sale
the action prosecutor may request the execution judge for the stay of the sale on the
condition that an official copy of the initiatory pleading of the notified action is to be
deposited in the execution file.
3. It shall be by no means possible to appeal against the decisions delivered according to
the two preceding clauses concerning the stay of the sale or the continuation therein.
Article (310)
1. If the payability action hasn’t dealt but with a part of the confiscated real estates, the
sale of the remaining parts shall not be halted.
2. However, the execution judge may order, on the basis of the concerned parties’
request, the stay of the sale regarding all the real estates if there were urging reasons
necessitating that.
Article (311)
If the sale has been considered payable the one with whom the auction has landed may
claim the price, indemnities from the creditors and the debtors if they had aspects, and it
is not possible that the sale conditions would include the exemption from refunding the
price.
Article (312)
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Neither the debtor nor the judiciary members nor the public prosecution nor the execution
agents nor the clerks of the court and the public prosecution nor the lawyers who are
attorneys of those who undertake the procedures for the debtor may come to the auction
by themselves or by employing others, otherwise the sale shall be null.

Chapter VII. Some Special Sales
Article (313)
1. Selling the real estate of the bankrupt, the incapacitated person’s real estate of which
the sale has been permitted and the real estate of the absentee, by auction shall be
proceeded on the basis of the sale conditions which the debtors’ attorney or the
attorney of the incapacitated or the absentee present to the execution judge after he
has approved them.
2. The sale conditions should include the permission issued for the sale from the
authorized court.
3. The case management office of the court should notify the public prosecution with the
sale conditions, before presenting them to the execution judge.
Article (314)
1. If the court has decided the sale of the owned real estate in common for the
impossibility of the division without harm, the execution judge shall proceed in its
sale by auction, according to one of the partners’ request.
2. The sale conditions should include a list of all the partners, the residence of each, and
it should be attached thereto a copy of the decision delivered for proceeding the sale.
Article (315)
The rules related to the procedures of the real estate sale, according to the creditors’
request, and stipulated in this law shall be applied on the sales mentioned in the two
Articles (313), (314).

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Title Three. Allocation of the Execution Proceeds
Article (316)
As soon as the confiscation on the money with the debtor, or the sale of the confiscated
money has been accomplished, or ten days have passed form the date of reporting what is
in the patrimony concerning) the confiscation of what the debtor had with the others, the
execution revenue shall be distributed on the confiscating creditors and on those who are
considered parties in the procedures without any other procedure, even if the revenue is
not sufficient to settle their entire rights.
Article (317)
1. If the execution revenue has been sufficient to settle all the confiscating debtors’
rights, and all the rights of those who were considered parties in the procedures, the
execution judge should order that each of the creditors’ debts shall be settled after
submitting the executive document.
2. If there were no executive document in the possession of anyone of them, and the
action for the right and the validity of the confiscation were still under the
examination, a sum corresponding to the debt for which the confiscation has been
decided shall be assigned for that creditor, and it shall be kept in the court’s case for
his account as a security for the final decision in the action.
Article (318)
1. If the execution revenue were not sufficient for settling all the confiscating creditors’
rights and for settling the rights of all those who have been considered parties in the
procedures, the party who shall have such revenue should immediately deposit in the
court’s case such revenue supplemented with a list of the confiscations inflicted under
his control.
2. The distribution shall be among the debtors (creditors) of the excellent debts and the
owners of the bound rights, according to the hierarchy of their degrees stipulated in
the law.
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Article (319)
1. The distribution procedures shall start with the execution judge’s preparation, on the
basis of one of the concerned parties’ request, of the temporary distribution list to
deposit in the case management office of the court, and he, as soon as he has
deposited the list, should notify the debtor, the tenant and the confiscators, and who
have been considered parties in the procedures in order to appeared before the
execution judge at a session he appointed to reach an amicable adjustment.
2. If the concerned parties have attended and have reached an agreement on the
distribution through an amicable adjustment, the execution judge shall document their
agreement in a report signed by the authorized employee and the attendants, and such
report shall have the power of the executive document.
3. When the adjustment has been accomplished in the way mentioned in the preceding
clause, the execution judge shall prepare within the five following days a final
distribution list with what each creditor is entitled to from the principal and the
expenditures.
Article (320)
1. The execution judge shall deposit in the case management office of the court, the final
distribution list with what each creditor is entitled to from the principal and the
expenditures.
2. In all cases, the execution judge shall order the delivery of the expenditure orders to
the court’s case, and the removal of the bonds whether related to debts included in the
list or with debts which the distribution hasn’t taken into account.

Title Four. The Execution in Kind
Article (321)
1. The execution agent, in the case of the execution by delivering a real estate, should go
the place where the item is located in order to deliver it to the requester, and he should
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list in his report the items due of delivery and the executive document, and the date of
its announcement. If the delivery is to be undertaken on an occupied real estate with
an occasional occupant, the execution agent shall advise him to recognize the new
occupant after the accomplishing real estate delivery proceeding.
2. If the confiscated required to be delivered were confiscated, it shall not be possible to
the execution agent to deliver them to the requester, and the execution agent should
notify the confiscating creditor.
3. The execution judge shall deliver the orders needed for securing the rights of the
concerned parties, on the basis of the request of the beneficiary or the execution agent.
Article (322)
1. The execution agent shall notify the person obligated to evacuate the real estate with
the day and hour at which he should proceed the execution of the evacuation, and that
shall be three days, at least, before the appointed day and when the appointed time
comes, he shall enable the requester to take possession of the real estate, and if there
were in the mentioned real estate movables that should not be delivered to the
evacuation requester and their owners hasn’t transport them immediately, the
execution agent should entrust their receivership, at the same place, to the requester,
or move them to another place if the requester hasn’t accepted the receivership, and if
such movables were under confiscation or receivership the execution agent should
inform the creditor according to whose request the confiscation or receivership has
been occurred, and the execution agent should, in both cases, bring the matter before
the execution judge in order to undertake what he shall consider necessary to protect
the rights of the concerned parties.
2. The execution agent shall write a report showing the executive document, its
announcement date, the description of the real estate object of the evacuation, the
movables which should not be delivered to the requester and the procedure taken in
this respect.
Article (323)
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1. The requester of the obligatory execution committing a work or abstaining from a
work should submit a request to the execution judge in order that he may designate
the proceeding through which the execution should be accomplished, and the request
should be attached to the executive document and its announcement.
2. After notifying the other party in order to hear his statements, the execution judge
shall deliver his order for designating the proceeding in which the execution shall be
accomplished, and for assigning the execution agent who shall proceed in it and the
persons who shall be assigned to fulfill the work and the removal.

Title Five. Detention of the Debtor and Prohibition Thereof from Traveling and
Other Precautions
Chapter I. Detention of the Debtor
Article (324)
1. The execution judge may issue an order, according to the request of the party to
whom the decision has been delivered, with the detention of the debtor if he has
abstained from the execution of the final decision or an order with a final performance
in spite of proving his ability to pay if his solvency was entirely based on properties
that are not legal to confiscate or sell.
2. The debtor shall be considered solvent and the execution judge shall issue an order to
detain him if he abstains from the payment and that in the following circumstances:
a) If the debtor has smuggled his money or concealed them with the intention of
harming the creditor, and it has been impossible to the creditor because of such
execution on these properties.
b) If the debt was one or more of the installments decided on the debtor, or the
debtor was one of those who guaranteed the principal debtor for the payment
before the court or the execution judge, except if the debtor has proved the
occurrence of new facts, after setting the installments on him or after giving him
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the bail, which have influenced his solvency and made him incapable of paying
the installments or the bail’s value or any part thereof.
c) If the sum decided to be paid by the debtor was an established legal alimony.
3. The execution judge shall order the detention of the debtor in the cases mentioned in
the preceding clauses within a period not exceeding one month and it may be renewed
to extend to other periods, so if the debtor had a settled residence it shall not be
possible that the detention periods exceed six consecutive months and it shall be
possible to order the renewal of his detention after the elapse (expiry) of ninety days
from his release if he has remained abstaining from the execution in spite of his
solvency to pay, provided that the total sum of the detention periods shall not exceed
thirty six months however the number of the debts or the creditors was.
4. The execution judge should hear the debtor’s statements whenever he orders the
renewal of his detention or if the debtor has requested that.
5. The debtor shall be detained in the prison isolated from the arrested or the convicted
in penal cases and the prison administration shall dispose for him the available means
to communicate with the external world in order to be able to manage to settle the
debt or proceed an adjustment with the creditors.
6. The execution of the detention order shall not result in the extinction of the right for
which fulfillment the detention has been decided and it shall not prohibit the
obligatory execution for its fulfillment through the proceedings legally established.
Article (325)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. The Execution judge shall, before issuing the detention order, undertake a summary
investigation if he hasn’t been satisfied with the documents supporting the request.
2. The judge may give the debtor a period of 6 months at most to pay the debt or to pay
the amount, for which execution has been imposed, in appropriate installments with
guarantees or precautionary measures set by the judge should he fear the debtor’s
escapes from the State.
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3. A grievance against the order mentioned in Clauses 1 and 2 of the present Article
shall be filed according to the procedures prescribed for grievance against petition
orders.
Article (326)
* As amended by Federal Law No. (10) of 2014 dated 20/11/2014:
1. An order of detention of the debtor may not be issued in the following cases:
a) If he/she is aged less than 18 or more than 70.
b) If he/she has a child aged less than 15 and his spouse is deceased or imprisoned
for any reason whatsoever.
c) If he/she was a spouse of the creditor or one of his ascendants, unless the debt is a
prescribed alimony.
d) If he had submitted a sufficient bank guaranty or a solvent guarantor accepted by
the execution judge, to pay the debt in a timely manner or provided statements of
funds, belonging to him in the State, on which execution may be imposed and
which are sufficient to cover the debt.
e) Should it be proven, according to a certified medical statement, that the debtor
suffers from an incurable chronic disease with which the debtor cannot tolerate
imprisonment.
f) If the debt subject of execution is less than AED 10,000, unless it is a fine, a
prescribed alimony or a work remuneration.
2. The execution judge may postpone the issuance of the order of detention of the debtor
in the following cases:
a) Should the debtor be a pregnant woman.
b) Should it be proven, by a certified medical statement, that the debtor suffers from
a temporary disease with which he does not tolerate imprisonment until cured.
Article (327)
If the debtor were a special legal person, the order shall be issued for detaining that
whom the abstention from the execution has been referred to personally.
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Article (328)
The execution judge shall order the extinction of the order issued for detaining the debtor
in the following circumstances:
1) If the creditor has accepted, in writing, the extinction of the order.
2) If, for any reason whatsoever, the debtor’s commitment for which fulfillment this
order has been issued has expired.
3) If one of the conditions required for the detention order was lacking, or one of its
issue impediments has been actualized.

Chapter II. Prohibition of Debtor from Traveling
Article (329)
* As amended by Federal Law No. (30) dated 30/11/2005:
Even if the creditor has accepted the prosecution of a substantive action, if serious
reasons from which there would be risk of the debtor’s escape, and the debt were not less
than Ten Thousand Dirham, unless it were an established alimony, the creditor may
request from the authorized judge or the circuit manger to, according to the
circumstances, the issue of an order prohibiting the debtor from traveling in the two
following cases:
First: If the debt were known and unconditionally payable.
Second: If the debt were not of determinant amount the judge shall estimate its amount
with a temporary estimation, provided that the two following conditions should be
fulfilled:
1) The claim for the right is to be based on written evidence.
2) The creditor should submit a bail which is accepted by the court and in which he
guarantees each failure or damage that would affect the debtor because of prohibiting
him from traveling if the creditor has been proved not to be rightful in his claims.
The judge, before issuing the order, may undertake a summary investigation if he were
not satisfied with the documents confirming the request.
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The judge, in case he has issued the order with the prohibition from traveling, may order
the deposit of the debtor’s passport in the court’s case and may circulate the order of the
traveling prohibition throughout all the state’s outlets.
The party against whom the order has been issued may complain thereof through the
procedures set for the complaint against the orders on the petitions.
The order prohibiting from traveling shall not prevent the execution of the final decisions
issued for the provision of banishment.
In case of the delivery of a final decision for the provision of banishment, the order of the
traveling prohibition shall be exposed before a judicial committee under the chairmanship
of a judge and for which constitution an order from the cabinet is to be issued for
examining the execution of either one.
Article (330)
The order with the prohibition from traveling shall continue to be in effect until, for any
reason whatsoever, the debtor’s commitment to his creditor prosecuting the order, shall
have been expired, however, the authorized judge shall order the extinction of the order
mentioned above in the following circumstances:
1) If any of the conditions required for the order prohibiting from traveling has been
extinguished.
2) If the creditor has agreed, in writing, on the order extinction.
3) If the debtor has submitted a bank bail or a solvent bondsman approved by the judge.
4) If the debtor has deposited in the court’s case a sum of money equal to the debt and
the expenditures, and has allotted it for the payment to the right of the creditor for
whose request the order has been issued, and this sum shall be considered confiscated
by the power of the law for the benefit of the creditor.
5) If the creditor hasn’t submitted to the judge what proves the prosecution of the action
of the debt within eight days from issuing the order prohibiting from traveling, or he
hasn’t started the execution of the final decision issued to his benefit within thirty days
from the date of its final issue.

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Chapter III. Other Precautionary Measures
Article (331)
If the debtor prohibited from traveling has abstained from depositing his passport without
a good reason or it has been disclosed to the judge that he has disposed of his money, he
has smuggled them or he has been preparing to run away from the state in spite of the
precautions taken for prohibiting him from traveling, so the judge may give orders to
summon him committing him to submit a payment bail or an attendance bail or to deposit
the sum prosecuted for in the court’s case, and if he hasn’t abided to the order the judge
may order his detention temporarily till the execution of the order, and this decision shall
be subject to appeal within seven days from the date of its issue.

Preamble
We, Khalifa Bin Zayed Al Nahyan, President of the United Arab Emirates,
Pursuant to the perusal of the Constitution,
Federal Law No. (1) of 1972, On the Competencies of the Ministries and Powers of the
Ministers and its amendments;
Federal Law No. (5) of 1975 On the Commercial Register;
Federal Law No. (10) of 1980 On the Central Bank, the Monetary System and the
Regulation of the Banking Profession and its amendments;
Federal Law No. (8) of 1984 On Commercial Companies and its amendments;
The Civil Transactions Law promulgated by Federal Law No. (5) of 1985 and its
amendments;
Federal Law No. (6) of 1985 On Banks, Financial Institutions and Islamic Investment
Companies and its amendments;
Federal Law No. (3) of 1987 On the Penal Law and its amendments;
Federal Law No. (22) of 1991 On Notary Publics and its amendments;
The Civil Procedures Law promulgated by Federal Law No. (11) of 1992 and its
amendments;
The Criminal Procedures Law promulgated by Federal Law No. (35) of 1992 and its
amendments;
The Law of Evidence in Civil and Commercial Transactions promulgated by Federal Law
No. (10) of 1993 and its amendments;
The Commercial Transactions Law promulgated by Federal Law No. (18) of 1993;
Federal Law No. (22) of 1995 On Regulating the Profession of Auditors and its
amendments;
Federal Law No. (29) of 1999 On the General Authority for Awqaf and its amendments;
Federal Law No. (4) of 2000 On the Emirates Securities & Commodities Authority and
Market and its amendments;
Federal Law No. (7) of 2002 On Author’s Rights and Related Rights and its amendments;
Federal Law No. (8) of 2004 On Financial Free Zones;
Federal Law No. (2) of 2015 On Commercial Companies
Page 2 of 128
Federal Law No. (17) of 2004 On Anti-Commercial Concealment and its amendments;
Federal Law No. (1) of 2006 On Electronic Transactions and Commerce;
Federal Decree-Law No. (4) of 2007 On the Establishment of the Emirate Investment
Authority;
Federal Law No. (6) of 2007 On the Establishment of the Insurance Authority and the
Regulation of its Operations;
Federal Law No. (4) of 2012 On the Regulation of Competition;
And based on the proposal made by the Minister of Economy and the approval of the
Cabinet and the Federal National Council and as ratified by the Federal Supreme Council,
Have promulgated the following Law:
TITLE I. GENERAL PROVISIONS FOR COMPANIES
Chapter I: Definition of a Company
Article (1) – Definitions
In application of the provisions of this Law, the following terms and expressions shall have the
meanings assigned against each, unless the context requires otherwise:
State: The United Arab Emirates.
Federal Government: The Government of the United Arab Emirates.
Local Government: Any of the Governments of the Member Emirates of the Federation.
Ministry: Ministry of Economy;
Minister: Minister of Economy.
Central Bank: The Central Bank of the United Arab Emirates.
Authority: The Securities & Commodities Authority.
Competent Authority: The local authority having competence with regards to the affairs of
companies in the relevant Emirate.
Company: The commercial company.
Diligent Person: The person having sufficient experience and commitment required in the
performance of his work.
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Governance: A set of criteria, standards and procedures that achieve corporate Governance at
the management level of the company in accordance with the international standards
and practices, by determining the duties and responsibilities of the Directors and the
executive management of the company, taking into account the protection of shareholders
and stakeholders rights.
Working Day: The official working days in the Ministries, the Governmental Authorities and
the local departments.
Special Resolution: Resolution issued by the majority votes of shareholders holding at least
75% of the shares represented at the General Assembly of the joint stock company.
Registrar: Companies Registrar appointed by the Minister, who performs his duties through
the Companies Department of the Ministry.
Markets: The securities and commodities Markets licensed by the Authority to operate in the
State.
Securities:
– Shares issued by joint stock companies;
– Derivatives and investment units as approved by the Authority;
– Bonds, deeds and bills issued by the Federal Government or the Local Governments or by
the public authorities or establishments in the State.
– Bonds, deeds or any debt tools issued by companies in accordance with such regulation
issued by the Central Bank and the Authority.
– Any other local or foreign Securities acceptable to the Central Bank and the Authority.
Public Subscription: The invitation for any natural or juristic person or class or classes of
persons to purchase any Securities.
Securities Book Building: The process under which the price of the security is determined
upon its issue or sale in a Public Subscription, in accordance with the provisions of the
Decision issued by the Authority in this respect.
Strategic Partner: The partner whose contribution to the company provides technical,
operational or marketing support to the company, for the good of the company.
Related Parties: The Chairman and other members of the board of directors and the senior
executive management of the company and working therein, and the companies in which
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any of such persons holds at least 30% of their share capital and subsidiary, associated or
sister companies.
Share Register: The register that shows the shares held by shareholders in Joint Stock
Companies and the rights attached to such shares.
Share Register Secretariat: The body or bodies licensed by the Authority to keep the
Share Register of Private Joint Stock Companies.
Member of the Board of Directors: Any member among the members of the company’s
board of directors, including the Chairman.
Article (2) – Objectives of the Law
The Law has for objective to contribute to the development of the working environment and
capacities of the State and its economic position in regulating companies according to the
various international norms related to governance rules and the protection of shareholders and
supporting foreign investment and promoting the corporate social responsibility of companies.
Article (3) – Companies Governed by the Provisions of this Law
The provisions of this Law and the Regulations, Instructions and Decisions issued in execution
hereof shall apply to such companies established in the State. The provisions of this Law
concerning foreign companies and the Regulations, Instructions and Decisions issued in
execution hereof shall apply to foreign companies that have established in the State a base to
conduct any activity therein or established a branch or representative office in the State.
Article (4) – Companies Exempted from the Provisions of This Law
1. Other than the registration and renewal in the exempted companies register at the Ministry,
the Authority and the competent authority, each according to its jurisdiction, the provisions
of this Law shall not apply to:
a) Companies exempted under a Cabinet Decision and each of those whereby a special
provision to that effect is contained in the Memorandums of Association or Articles of
Association of such companies according to the controls issued by a Cabinet Decision;
b) Companies held in full by the Federal Government or the Local Government, and any
other companies held in full by such companies if a special provision to that effect is
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contained in the Memorandum of Association or Articles of Association of such
companies.
c) Companies in which the Federal Government, the Local Government or any of the
establishments, authorities, departments or any companies controlled or held by any of
them directly or indirectly, and having at least 25% of the shares of such companies,
which operate in oil exploration, drilling, refining, manufacturing, marketing and
transportation or operating in the energy sector of all kinds or in the electricity
generation, gas production or water desalination, transmission and distribution, if a
special provision to this effect is contained in the Memorandum of Association or
Articles of Association of such companies.
d) Companies exempted from the provisions of Federal Law No. (8) of 1984 On
Commercial Companies and its amendments, prior to the effective date of this Law.
e) Companies exempted from the provisions of this Law under special Federal Laws.
2. The companies referred to in the sub sections 1-b,-c,-d of this provision shall adjust their
position in accordance with the provisions of this Law if such company sells or publicly
offers any percentage of its share capital or lists its shares in any of the financial Markets in
the State.
Article (5) – Companies Operating in Free Zones
1. The provisions of this Law shall not apply to companies established in the free zones of the
State if a special provision to this effect is contained in the Laws or regulations of the
relevant free zone. Notwithstanding the foregoing, such companies shall be governed by the
provisions of this Law if such Laws or regulations permit to conduct the activities of such
companies outside the free zone in the State.
2. In accordance with sub section 1 of the present provision, the Cabinet shall issue a Decision
determining the applicable conditions to enter and register companies operating in the free
zones of the State and willing to conduct their activities in the State outside the free zones.
Article (6) – Corporate Governance
1. With the exception of banks, financing companies, financial investment companies,
exchange and money brokerage companies, the Minister shall issue the decisions which set
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the general framework regulating Governance in connection with private joint stock
companies where the number of the shareholders therein exceeds 75. As for the Public Joint
Stock Companies, the Chairman of the Authority shall issue the relevant Governance
Decisions.
2. The Board of Directors of a company or its managers, depending on the circumstance, shall
be responsible for the application of the rules and criteria of Governance.
Article (7) – Breach of the Rules of Governance
1. The Decisions regulating Governance as provided by Clause 1 of Article (6) shall include
fines to be imposed by the Ministry or, as applicable, the Authority to the companies and
their Chairmen, Directors, managers and auditors in the event of contravention of such
Decisions, provided that the fine amount shall not exceed AED ten million.
2. The imposition of the fines referred to in Clause 1 of the present Article shall be subject to
the provisions of Article (339) hereof in regards to the regulation of reconciliation.
Article (8) – Definition of a Company
1. A company is a contract under which two or more persons are committed to participate in
an economic enterprise with the objective of profit realization by contributing a share in
capital or work and dividing between themselves the profit or loss resulting from the
enterprise.
2. An economic enterprise as provided for in Clause 1 of this Article shall include every
commercial, financial, industrial, agricultural, real estate or other kinds of economic
activity.
3. Notwithstanding the provision of Clause 1 of this Article, a company may be incorporated
or held by a single person in accordance with the provisions of this Law.
Article (9) – Forms of Companies
1. The company shall take one of the following forms:
a) Joint Liability Company.
b) Simple Commandite Company.
c) Limited Liability Company.
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d) Public Joint Stock Company.
e) Private Joint Stock Company.
3. Any company which does not adopt one of the forms referred to in the preceding Article
shall be considered null and void, and the persons concluding contracts in its name shall be
individually and jointly liable for the obligations arising from such contracts.
4. Every company established in the State shall bear the nationality thereof, but this does not
entail that said company shall necessarily enjoy the rights exclusive to UAE nationals.
Chapter II: Formation and Management of the Company
Article (10) – Rate of National Contribution
1. With the exception of Joint Liability Companies and Simple Commandite Companies where
all the joint partners of any of such companies shall be UAE nationals, any company
established in the State shall have one or more UAE partners holding at least 51% of the
share capital of the company.
2. Notwithstanding the provisions of Clause 1 of this Article, the Cabinet may, based on the
proposal made by the Minister in coordination with the competent authorities, issue a
Decision setting the class of activities to be exclusively exercised by UAE nationals.
3. Any transfer of the title to any share of a partner that may affect the percentage as set out in
Clauses 1 and 2 of this Article shall be invalid.
Article (11) – Practice of Activity
1. The company shall obtain all the approvals and licenses as required for the activity to be
conducted by the company in the State prior to commencement of its activity.
2. A company incorporated inside the State shall commence its main activities in the State,
and may conduct its activity outside the State if such is provided for by its Memorandum of
Association.
3. The Cabinet shall issue a Decision determining the formation and qualifications of the
members of the Internal Shariah Control Committees and the Shariah Controller of
companies incorporated inside the State and which conduct their activities in accordance
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with the provisions of the Islamic Shariah. The Decision shall determine the conditions of
operation of such committees.
Such companies must, following their incorporation and prior to the commencement of
activities, obtain the approval of the Internal Shariah Control Committees.
4. Only Public Joint Stock Companies may conduct banking and insurance activities. Only
Joint Stock Companies may invest money for the account of third parties.
Article (12) – Name of the Company
1. The company shall have a trade name, without contravention of the public order of the
State. The name shall be followed by the legal form of the company. No company may be
registered in a name previously registered in the State or in any similar name to the extent
that it may lead to confusion.
2. The company may change its name to another name by virtue of a special Resolution issued
by its General Assembly and the like, as approved by the competent authority and as
acceptable to the registrar. The change of the name of the company shall not prejudice its
rights or obligations or the legal proceedings initiated by or against the company. Any legal
proceedings that have already been initiated by or against the company shall also continue
in the amended name of the company.
Article (13) – Address and Correspondences of the Company
1. Every company shall have a registered address in the State to which notices and
correspondences shall be dispatched.
2. All contracts, documents, correspondences and forms of applications issued by the company
shall bear its name, legal form, registration number and address and, if the share capital of
the company is added to such particulars, the amount of the paid share capital shall be
stated.
3. If the company is under liquidation, the papers of the company shall be marked accordingly.
Article (14) – Drafting of the Memorandum
1. The Memorandum of Association of a company and each amendment thereto shall be made
in Arabic and attested by the Notary Public, failing which the Memorandum of Association
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or the amendment thereto shall be invalid. If the Memorandum is issued in a foreign
language in addition to Arabic, the Arabic text shall be the applicable text in the State.
2. The partners may hold against each other to the invalidity arising from not writing or
attesting the Memorandum or the amendment. However, the partners may not hold against
third parties to such invalidity.
3. If the invalidity of the company is adjudicated based on the request of a partner, such
invalidity shall have no effect other than from the date on which such ruling becomes final.
Article (15) – Registration of the Memorandum of Association of the Company with the
Competent Authority
1. A Company’s Memorandum of Association and any amendment thereto shall be registered
in the Commercial Register with the competent authority to be effective.
2. If the Memorandum of Association is not registered as set out in Clause 1 of this Article, it
shall be ineffective against third parties. If the non-registration is limited to one or more of
the details that should be registered, only such non-registered information shall have no
effect against third parties.
3. The companies shall notify the competent authority and the Registrar in writing within 15
(fifteen) working days upon the occurrence of any amendment or change in the registered
particulars of the company, including its name, address, share capital, number of
shareholders or legal status.
4. The Managers, or Directors of the Company, as the case may be, shall be jointly liable to
indemnify the damage suffered by the company, the shareholders, or third parties due to the
non registration of the Memorandum or any amendments thereto in the Commercial
Register with the competent authority.
Article (16) – Evidencing the Memorandum of the Company by Third Parties
1. A third party may prove the presence of the Memorandum of the Company or any
amendment thereto by all means of proof. Such third party may hold to the existence or the
invalidity of the company against the shareholders.
2. If the invalidity of the company is ruled based on third party request, the company shall be
deemed void ab initio as against such third party. Persons who have contracted with such
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third party in the name of the company shall be personally and jointly liable for the
obligations arising from such Contract.
3. In all cases where the invalidity of the company is ruled, the conditions set forth in the
Memorandum shall apply to the liquidation of the company and the settlement of the rights
of the shareholders against each other. The debtors of the company may not request the
invalidity or hold thereto in order to be discharged from their debts to the company.
Article (17) – Nature of the Share Provided by a Partner
1. The capital of the company shall be composed of either a contribution in cash or equivalent
in contribution in kind.
2. The partner may not contribute in work rendered, unless he is a joint partner. The
contribution of the partner may not consist of his having reputation or influence.
Article (18) – Rules Governing Contribution to the Company
1. If the contribution of a partner is a title to a property or any other real right, such partner
shall be liable in accordance with the applicable provisions concerning a Contract of Sale
regarding the transfer of a property and the guarantee of the share in the cases of loss,
maturity or the emergence of a defect or deficiency in such payment for the share, unless
agreed otherwise.
2. If the contribution consists of benefiting from the revenues from assets only, the provisions
applicable to the lease contract shall apply to such issues as set out in Clause 1 of this
Article, unless agreed otherwise.
3. If a contribution of a partner consists of debts payable by third parties or other rights in
kind, such partner’s liability shall not be discharged until such debts are settled. Moreover,
the partner shall be liable to indemnify the damage to the company if such debts are not
repaid when they become due.
4. Taking into account the provisions of the Law concerning Author’s Rights and their Related
Rights and the Law on the Regulation and Protection of Industrial Property Rights for
Patents and Industrial Designs and Models, should the partner’s contribution be his work,
any gain from the work shall be the right of the company unless the partner has acquired
rights to this gain as a patent right, unless agreed otherwise with the Company.
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Article (19) – Failure to Provide a Contribution to the Company
1. If a partner undertakes to contribute an amount of money, and such amount is not paid or
the share is debts payable by third parties not repaid, such partner shall be liable to the
company for any obligations in consideration of his contribution to the company.
2. A partner shall be liable to the company for the difference, if any, between the amount of
money or value of the contribution actually contributed by him to the company and the
amount of money or value of such other contribution as set out in the register of
shareholders, which the partner should have provided in accordance with the provisions of
this Law.
Article (20) – Enforcement upon Anything in Lieu of the Share
1. A creditor of a partner may not claim his right from the share of his debtor in the capital of
the company, but he may claim his right from his debtor’s portion of the profits. If the
company is dissolved, the creditor may collect his right from the share of his debtor upon
the liquidation of the company.
2. If the share of a partner in the company is represented by shares, then its creditor may, in
addition to the rights as set out in Clause 1 of the present Article, file a suit before the
competent court for the sale of such shares to apply the sale proceeds to collect his right.
Article (21) – Corporate Personality of the Company
1. The company shall, from the date of entry in the Commercial Register with the competent
authority, acquire a corporate personality in accordance with the provisions of this Law and
the Resolutions issued hereunder.
2. During the incorporation period, the company shall have a corporate personality to the
extent necessary for its incorporation. The company shall be bound by the acts of the
founders in connection with the incorporation procedures and requirements in such period,
provided that such incorporation shall be completed in accordance with the provisions of
this Law.
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3. Upon its dissolution, the company shall be considered under the liquidation phase. During
the period of liquidation, the company shall maintain its corporate personality to the extent
as required for the liquidation process. The expression “Under
4. Subsidiaries of the holding company shall enjoy a corporate personality and shall have its
own independent financial liability.
Article (22) – Duties of the Managing Director of the Company
A person authorized to manage the company shall preserve its rights and extend such care as a
diligent person. Such person shall do all such acts in agreement with the objective of the
company and the powers granted to such person by virtue of an authorization issued by the
company in this respect.
Article (23) – Liability of the Company for the Acts of its Managing Director
The company shall be bound by any act or behaviour arising out of its Managing Director upon
conducting the affairs of management in a usual manner. The company shall also be bound by
any act of any of its employees or agents authorized to act on behalf of the company, and
whereby a third party relies thereon in its transaction with the company.
Article (24) – Exemption from Liability
Subject to the provisions of this Law, any provision in the Memorandum of Association or
Articles of Association of the company authorizing it or any of its subsidiaries to agree to
exempt any person from any personal liability that such person bears in his capacity as a
current or former officer of the company shall be void.
Article (25) – Protection of Those Dealing with the Company
1. The company shall not claim lack of liability towards those dealing with it, on the ground
that the management authority was not duly appointed in accordance with the provisions of
this Law or the Articles of Association of the company, so long as the acts of such authority
is within the usual limits with respect to persons in the same position in companies that
conduct the same type of activity as the company.
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2. To protect a person dealing with the company, he shall be a bona fide party. A person shall
not be deemed as acting in good faith if he actually knows or could have known, based on
his relationship with the company, the aspects of deficiency in the act or work proposed to
be held thereto against the company.
Article (26) – Accounting Records
1. Every company shall keep accounting records showing its transactions to accurately reveal
at any time the financial position of the company and enabling the partners or shareholders
to confirm that the accounts of the company are properly kept in accordance with the
provisions of this Law.
2. Every company shall keep its accounting books in its head office for a period of at least 5
(five) years from the end of the financial year of the company.
3. The company may keep an electronic copy of the original of the documents and records
kept and deposited therein in accordance with the controls issued by a Ministerial Decision.
Article (27) – Accounts of the Company
1. Every Joint Stock Company or Limited Liability Company shall have one or more auditors
to audit the accounts of the company every year. The other types of companies may appoint
an auditor in accordance with the provisions of this Law.
2. The company shall prepare annual financial accounts including the balance sheet and the
profit and loss account.
3. The company shall apply the International Accounting Standards and Practices upon
preparing its periodical and annual accounts, to give a clear and accurate view of the profits
and losses of the company.
4. Every partner or shareholder in any company may, based on a written request presented,
obtain a free copy of the last audited accounts and of the last report of its auditor and a copy
of the accounts of the group if it is a holding company. The company shall respond to such
request within 10 (ten) days from the date of submittal thereof.
Article (28) – Financial Year of the Company
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1. Every company shall have a financial year as determined in its Articles of Association,
provided that the first financial year of the company shall not exceed 18 (eighteen) months,
but at least 6 (six) months, to be calculated from the date of registration of the company in
the Commercial Register with the competent authority.
2. The subsequent financial years shall consist of consecutive periods, each of 12 months
commencing directly upon the expiry of the preceding financial year.
Article (29) – Distribution of the Profits and Losses
1. If the company’s Memorandum of Association does not stipulate the proportion of a partner
in the profits or losses, his share thereof shall be pro rata to his stake in the capital. If the
Memorandum of Association is limited to specifying a partner’s share in the profits, his
share in the losses shall be equivalent to his share in the profits and vice versa.
2. If a partner’s stake is limited to his work, the company’s Memorandum of Association shall
specify his share in the profits and losses. If the partner has contributed a share in cash or in
kind in addition to his work, he shall have a portion of the profits and losses for his share
contributed by work and another portion for his share in cash or in kind.
3. If it is agreed in a company’s Memorandum of Association that one of the partners is to be
deprived of the profits or exempted from loss, or to receive a fixed percentage of profits,
such Memorandum shall be deemed void.
4. It may be agreed to exempt a partner who has contributed only by his work from sharing in
the loss, provided that a wage for such work is not determined.
Article (30) – Distribution of Profits
1. No fictitious profits may be distributed to the partners or shareholders. The Board of
Directors or any similar body shall be liable towards the partners or shareholders and the
creditors of the company for such procedure.
2. If the company distributes any profits in violation to the provisions of this Law and the
Decisions issued hereunder, such partner or shareholder shall return any profits received by
him in violation to such provisions. The company’s creditors may request such partner or
shareholder to return what he has received thereof, even if done in good faith.
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3. Partners or shareholders shall not be deprived of the true profits that they have received
even if the company sustains losses during the following years.
Article (31) – Issuing Securities
Subject to the provisions of Article (4) of this Law, only the Joint Stock Company may
issue negotiable shares, bonds or Sukuk.
Article (32) – Public Offering of the Securities
No company other than a public Joint Stock Company may offer any Securities for public
subscription. In all events, no company, entity, natural or corporate person incorporated or
registered inside the State or in the free zones or abroad may publish any advertisements
in the State, including the invitation for public subscription in Securities without the prior
consent of the authority.
Chapter III: Companies Registrar
Article (33) – Regulation of the Activities of the Registrar
The Minister shall, in coordination with the competent authority, issue the regulation for
the activities of the Registrar.
Article (34) – Supervision of the Trade Names Register
1. The registrar shall, in addition to his duties as assigned by the Minister, supervise the Trade
Names Register for the various types of companies registered in any of the Emirates to
avoid double registration.
2. The competent authorities shall provide the registrar with the names of all the companies
and all the trade names licensed by the competent authorities and shall refer to the registrar
to avoid name repetition prior to granting any new license.
Article (35) – The Role of the Registrar in the event of Similar Trade Names
1. If the registrar finds any similarity between the names of two or more companies registered
in the State to an extent that may cause confusion, the registrar may issue a justified
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Decision demanding thereunder that the relevant parties take the required steps to change
the name so as to remove such confusion, within 30 (thirty) working days to be counted
from the date of the notification of the Decision. The registrar may, upon the expiry of such
period issue another Decision of such change.
2. A company that has been entered with the registrar may request the latter to oblige the
company that took up its own name or a name similar to its name to change such name. The
registrar may issue a justified Decision under which he demands the latter company to take
such steps as required to change the name, within 30 (thirty) working days, to be counted
from the date of notification of the Decision. Upon expiry of such period, the registrar may
issue another Decision to change the trade name of the company.
3. A grievance against the Decision of the registrar may be filed before the Minister within 15
(fifteen) working days from the date of notification of such Decision. If such grievance is
rejected or not settled within 15 (fifteen) working days from the date of filing thereof, the
concerned persons may appeal such Decisions before the competent Court within 30 (thirty)
days from the date of rejecting the grievance or the expiry of such period, as the case may
be.
Article (36) – Registrar to Keep the Documents of Companies
The Minister shall issue a Decision determining:
1) The period of time during which the registrar has to keep documents, so that such
documents may be destroyed after the expiry of such period.
2) To organize the submission of documents to the registrar by the electronic means of
communication and other means. The Decision shall include provisions to ensure effective
connection between the records kept by the registrar and those kept by the competent
authority.
Article (37) – Perusal of the Records kept by the Registrar
Subject to the provisions of this Law, the concerned parties may request the registrar to issue:
1) A copy of the particulars as set out in the records kept by the registrar.
2) A certificate by the registrar or the competent authority, including some of the particulars as
contained in such records.
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Article (38) – Fees Payable to the Ministry and the Authority
On a proposal made by the Minister and in coordination with the Ministry of Finance, the
Cabinet shall issue a Decision of the fees payable by the companies for such activities
conducted by the Ministry and the Authority within the scope of application of the provisions
of this Law.
TITLE II. PARTNERSHIPS
Chapter I: Joint Liability Company
Article (39) – Definition of the Company
A Joint Liability Company is a company which consists of two or more partners who are
natural persons, to be jointly responsible in all their monies for the obligations of the company.
Article (40) – Capacity of the Partners
A joint partner shall have the capacity of a trader. Such partner shall be deemed to conduct the
commercial activities in person in the name of the company. The declaration of the bankruptcy
of a Joint Liability Company means the declaration of bankruptcy of all the partners by the
power of the Law.
Article (41) – Name of the Company
1. The name of a Joint Liability Company shall consist of the name(s) of one or more partners
in addition to the expression “and partners” or any similar meaning, provided that the name
of the company shall end with the expression “Joint Liability Company”. In addition, the
company shall have its own trade name, provided that the name of the company shall be
accompanied by such trade name.
2. If the name of a Joint Liability Company contains the name of a person other than a partner
in the company and that person is aware of this, that person shall be jointly responsible for
the company’s obligations against any person that deals with such company in good faith.
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Article (42) – Memorandum of Association of the Company
1. A Joint Liability Company’s Memorandum of Association shall include the following
particulars:
a) The full name of each partner, his nationality, date of birth and domicile;
b) The name, address and trade name, if any, of the company and the objective for which
it was established;
c) The head office of the company and its branches, if any;
d) The capital of the company and the shares of every partner and the estimated value of
such shares, the means by which they are assessed and the date of their falling due;
e) The commencement date of the company and the date of termination, if applicable;
f) The method by which the company is to be managed, with particulars of the names of
those persons who may sign on behalf of the company and the extent of their authority;
g) The commencement date and the expiry date of the financial year;
h) The rate of distributing profits and losses.
i) The conditions of assignment of shares in the company, if any.
2. If the Memorandum of Association of the company contains the name(s) of the manager(s),
the full name, nationality, place of residence and authority of each such manager shall be
stated.
Article (43) – Incorporation Procedures
The joint liability company shall be incorporated and registered as follows:
1) The competent authority shall determine the information and documents required for the
incorporation of the company, and shall issue a form of the application for incorporation in
accordance with the provisions of this Law.
2) To submit the application for incorporation, together with the required documents for the
license and registration procedures to the competent authority.
3) The competent authority shall demand the applicant to complete the statements and
documents as necessary to be submitted or to make such amendments to the Memorandum
of Association of the company to be compliant with the provisions of this Law and the
Decisions issued hereunder.
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4) The competent authority shall issue its Decision in the application for incorporation of the
company within no later than 5 (five) working days from the date of the application,
completion of the statements and documents or making the required amendments. If the
application is rejected, such rejection shall be justified.
5) If the competent authority rejects the application or the period as set forth in clause 4 of this
Article expires without decision of the application, the applicant may file a grievance before
the General Manager of the competent authority or his representative within 15 (fifteen)
working days. If the grievance is rejected or not decided within 15 working days from the
date of filing the same, the applicant may file an appeal before the competent Court within
30 (thirty) days from the date of his notification of the rejection or the expiry of the above
period, as the case may be.
6) If the application for incorporation is accepted, the competent Court shall enter the
company in the Commercial Register and issue a trade license for the company.
7) The company shall, within 5 (five) working days from the date of the trade license, provide
the registrar with a copy of the trade license and Memorandum of Association of the
company to be published in accordance with the conditions issued by the Minister in this
respect.
Article (44) – Statements and Documents required to be kept
The Joint Liability Company shall keep at its head office:
1) A register including the names and addresses of the partners;
2) A copy of the Memorandum of Association of the company and any amendments thereto;
3) A statement of the cash amounts and the nature and value of any assets contributed by each
partner and the dates of such contributions; and
4) Any statements, documents or other records imposed under the provisions of this Law and
the Decisions issued in execution hereof.
Article (45) – Management of the Company
1. The management of the company shall be undertaken by all the partners. Every partner in a
joint liability company shall be deemed as the agent of such company and the other partners
in connection with the business of the company, unless such management is delegated
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under the Memorandum of Association of the company or an independent contract to one or
more partners or to any person who is not a partner.
2. A partner who is not a manager may not interfere in the management affairs unless agreed
otherwise. However, such partner may demand to inspect the works of the company and its
books and documents and to make notes thereon to the manager of the company.
3. Decisions in connection with the business of the company shall be issued with the
unanimous consent of the partners, unless the Memorandum of Association of the company
provides otherwise.
Article (46) – Works in Competition of the Activity of the Company
1. A joint partner shall not, without the written consent of the other partners, carry out for his
own account or for the account of third parties an activity competing with the activity of the
company, or be a joint partner in another company.
2. If a partner in a Joint Liability Company carries out, without the consent of the other
partners, an activity of a similar nature and in competition with the activity of the company,
such partner shall pay to the company all such profits made by him from such activity.
Article (47) – Dismissal of the Manager
1. Where the Manager is a partner appointed in the Memorandum of Association of the
company, he shall not be dismissed except by the unanimous consent of the other partners
or under a judgment by the competent court.
2. If the Manager is a partner and appointed under an independent contract, or if he is not a
partner, whether appointed under the Memorandum of Association or under an independent
contract, he may be dismissed under a Decision passed by the majority of the partners or
under a judgment by the competent court.
3. The dismissal of the Manager in the events as set out in the above two Clauses shall not
result in the dissolution of the company, unless the Memorandum of Association provides
otherwise.
Article (48) – Resignation of the Manager
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If the Manager is a partner or not, he may resign from the management, provided that he
notifies the partners in writing of his resignation at least 60 days from the effective date of such
resignation, unless his contract provides otherwise, failing which he shall be liable to pay
compensation, and his resignation shall not bring about the dissolution of the company unless
the Memorandum of Association specifies otherwise.
Article (49) – Prohibited Acts by the Manager
A director may not conduct the tasks exceeding the ordinary management tasks unless upon the
consent of all the partners or by virtue of an express provision in the Memorandum of
Association; this restriction shall apply to the following tasks in particular:
1) Donations other than small customary ones governed by the commercial practice;
2) The sale of the company’s real estates unless such transaction falls within the objectives of
the company;
3) Mortgaging the company’s real estates or assets, even if the Manager was authorized to sell
its real estates under the company’s Memorandum of Association;
4) Securing the obligations of third parties; or
5) The sale, mortgage or lease of the company’s store.
Article (50) – Contracting by the Manager for his own Account
1. The Manager may not conclude a contract for his own behalf or on behalf of his relatives up
to the second degree with the company without the written permission of all the partners to
be given for each case separately.
2. The Manager may not carry out an activity of the same kind as that of the Company except
with the written permission by all the partners to be renewed annually.
Article (51) – Liability of the Manager
The Manager shall be liable for the damage suffered by the company, the partners or third
parties due to the breach of the provisions of the Memorandum of Association of the company
or the contract appointing the manager or due to any negligence or errors committed by the
manager upon performance of his job or his failure to carry out his work with due diligence.
Any condition to the contrary shall be void.
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Article (52) – Liability of Multiple Managers
1. Where there is more than one Manager and particular jurisdiction has been determined for
each of them, each Manager shall be liable only for those works which are within his
jurisdictions. Where there is more than one director and it is provided that they undertake
the management collectively, their Decisions shall not be valid unless taken unanimously or
by the majority specified in the Memorandum of Association. However, it may be stipulated
in the Memorandum of Association that each Manager may individually carry out urgent
works, the omission of which would cause substantial losses or considerably missed profits
of the company.
2. Where there is more than one Manager and no particular jurisdictions are specified for each
of them in the Memorandum of Association and it is not stipulated that they operate
collectively, each of them may individually undertake any of the management operations,
provided that the other managers may object to such operations before they are completed.
In such event, significance should be given to the majority votes and in the event of parity,
the matter shall be referred to the partners for conclusion and their decision shall be final.
3. The multi Managers shall exercise due care in their works.
Article (53) – Liability of the Company
The Joint Liability Company shall be liable against third parties to indemnify the damages
arising from the acts of any partner with the consent of the other partners or upon carrying on
the usual business of the company.
Article (54) – Joining Partner
Where a partner joins the company, he shall be jointly liable with the other partners and in all
his assets for all the former obligations of the company prior to his joining the company,
provided that the company has already disclosed such obligations to that partner, and shall be
jointly liable with the other partners for the obligations of the company after to his joining the
same. Any agreement between the partners to the contrary shall not be effective as evidence
against third parties.
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Article (55) – Withdrawing Partner
1. Unless the Memorandum of Association of the company stipulates otherwise, a partner may
withdraw from a Joint Liability Company by written agreement with the other partners. In
the event of disagreement, the partner may file a lawsuit before the competent court to
obtain a withdrawal judgment, provided that the other partners are notified thereof by
registered mail at least sixty days from the date proposed for withdrawal. The company
shall be entitled to demand the withdrawing partner to pay any compensation, as
applicable.
2. The withdrawing partner shall remain jointly liable with the other partners in the company
for the debts and obligations of the company prior to his withdrawal and shall be liable for
such debts and obligations in his own assets with the other partners.
3. A partner withdrawing from the company shall not be discharged from the obligations
borne by the company upon his withdrawal, unless such withdrawal is entered in the
Commercial Register and announced in two daily newspapers, one of them issued in
Arabic, after thirty days from the date of the last procedure.
4. If the company consists of two partners and one of them withdraws, the other partner may,
within six months from the date of entering the withdrawal in the Commercial Register, join
one or more new partners to the company instead of the withdrawing partner; otherwise the
company shall be deemed legally dissolved.
Article (56) – Assignment of Shares
1. Shares may not be assigned in a joint liability company without the consent of all the
partners, subject to the limitations as set out in the Memorandum of Association of the
company. The assignee shall not become a partner in the company until the registration of
the assignment with the competent authority and the notification of the registrar thereof.
2. Any agreement stating that shares may be assigned without limitation shall be
void. However, a partner may transfer to third party the rights attached to his share in the
company. Such agreement shall have no effect other than between the contracting parties.
Article (57) – Rights of the Deceased Partner
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Unless the partners agree otherwise, the amount payable by the other partners in the share of
the deceased partner shall be a debt payable from the date of dissolution of the Joint Liability
Company or from the date of death of the partner, whichever is earlier.
Article (58) – Transactions of the Company upon Expiry of its Term or Completion of its
Objective
1. The rights and obligations of the partners in a Joint Liability Company shall remain valid if
the company continues upon the expiry of its term or completion of the objective for which
it was established.
2. If a bona fide third party continues to deal with one or more joint partner upon amendment
of the Memorandum of Association of the company or the Decision to dissolve it, while
under the belief that the company is still under existence, such partner shall be liable to third
parties prior to the amendment of its Memorandum or the decision to dissolve the company.
The publication of the notice in at least two local daily newspapers, one of them is issued in
Arabic, shall be sufficient notice to the persons who deal with the Joint Liability Company
prior to the date of its dissolution or prior to the notification of the amendment to its
Memorandum.
Article (59) – Mutual Obligations of the Company and the Partners
Without prejudice to the provisions of the Memorandum of Association of the Joint
Liability Company, the following shall be taken into consideration:
1) Obligation for the company to settle any amounts that the partner has personally paid on
behalf of the company to enable the company to carry out its usual business or to maintain
its assets and activities.
2) Obligation for the partner to indemnify the company against any benefit obtained by him
upon performing any work in connection with the company or his use of its property, name
or trademarks without the consent of the company.
Article (60) – Execution against the Assets of a Partner
Execution may not be conducted against the assets of the partner for the obligations of the
company, unless after having obtained a writ of execution against the company, and notified it
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of such payment obligation, and the failure to make such payment by the company. The writ of
execution against the company shall be effective as evidence against the partner.
Article (61) – Profits and Losses
1. The profits and losses and the share of each partner in the company shall be determined at
the end of the company’s financial year in accordance with the balance sheet and the profit
and loss account.
2. Each partner shall be considered to be a creditor of the company to the extent of his share of
the profits from the time when such share is determined. Any deficit in the capital as a
result of losses shall be made up from the profits of the succeeding years unless there is
agreement to the contrary and, apart from that, a partner shall not be bound except with his
consent to make good any deficit in his share of the capital of the company resulting from
losses.
Chapter II: Simple Commandite Company
Article (62) – Definition of the Company
A Simple Commandite Company is a company which consists of one or more joint partners
liable, severally and jointly, for the obligations of the company and having the capacity of
traders, and one or more silent partners not liable for the obligations of the company other than
to the extent of their respective shares in the capital. Silent Partners shall not have the capacity
of a trader.
Article (63) – Capacity of the Silent Partner
Any natural person or corporate person may be a Silent Partner in the Simple Commandite
Company.
Article (64) – Name of the Company
1. The name of a Simple Commandite Company shall consist of the name of one or more of
the joint partners with the addition of such indication of the legal form of the company. In
addition to the aforementioned, the company may have its own trade name.
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2. The name of a Silent Partner may not be included in the name of the company. If such name
is added with his consent, the Silent Partner shall be deemed as a Joint Partner to bona fide
third parties.
Article (65) – Memorandum of Association of the Company
1. The provisions relating to the Joint Liability Company shall apply to a Simple Commandite
Company subject to the following provisions of this Chapter in connection with the Silent
Partner.
2. The Memorandum of Association of a Simple Commandite Company shall include a
statement of the names of the Joint Partners and the Silent Partners. If such partners are not
so identified in the Memorandum of Association, the company shall be deemed as a Joint
Liability Company and all the partners shall be deemed as Joint Partners.
3. The share of a Silent Partner may not be his work.
Article (66) – Management of the Company
The management of the company shall be limited to the Joint Partners. Decisions shall be
unanimously passed by the Joint Partners, unless the Memorandum of Association of the
company provides for majority. No variation of the nature of the business of the company or
amendment to its Memorandum of Association shall be valid without the consent of all the
Acting and Silent Partners.
Article (67) – Borrowing by the Company
1. A Silent Partner in a Simple Commandite Company shall have all the rights and powers of a
partner in a Joint Liability Company and shall be governed by all the conditions, limitations
and obligations imposed on the partner in the Joint Liability Company.
2. A loan or any other undertaking made by the Joint Partner in the name of the company or
for its account shall be deemed as the obligation of the company itself.
Article (68) – Rights of the Silent Partner
1. A Silent Partner shall have the same rights of a Joint Partner in connection with:
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a) To lend the company and to enter into transactions with the company, subject to the
consent of all the Joint Partners.
b) To inspect and obtain copies or extracts of books and records of the Company at all
times during the official working hours of the company.
c) To obtain full and accurate information on all the works of the company and a formal
statement thereof.
d) A Silent partner may carry out any of the works as set forth in Clause 1-a of this Article
in person or by other partners or third parties, provided that no damage to the company
occurs.
2. Upon application of the provisions of this Article, a Silent Partner shall not be deemed
involved in the management of a Simple Commandite Company upon conducting any of the
internal regulatory activities of the company and shall not be jointly liable for the debts of
the company against a bona fide third party.
Article (69) – Management Affairs
1. A Silent Partner may not interfere in the management affairs related to third parties, but
may demand a copy of the profit and loss account and the balance sheet and verify the
contents thereof by inspecting the books and documents of the company by himself or by an
agent from the partners or third parties, provided that no damage to the company occurs.
2. If a Silent Partner contravenes the prohibition as provided by Clause 1 above, he shall be
liable in all his assets for the obligations arising from his acts.
3. A Silent Partner may be liable as to all his assets for all the obligations of the company if
his management acts may make third parties believe that he is a Joint partner. In such event,
the provisions concerning the Joint Partners shall apply to the Silent Partner.
4. If a Silent Partner conducts any of the prohibited management acts under and express or
implicit authorization by the Joint Partners, such partners shall be jointly liable for the
obligations that may arise from such acts.
Article (70) – Assignment of Shares
A Silent partner shall not assign his share in the company to a third party, in full or in part,
without the consent of all the partners or by the majority stipulated in the Memorandum of
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Association of the company. The assignee shall not become a partner of the company until the
registration of such assignment with the competent authority and notifying the registrar thereof.
TITLE III. LIMITED LIABILITY COMPANY
Chapter I: Incorporation of the Limited Liability Company
Article (71) – Definition of the Company
1. A Limited Liability Company is a company where the number of partners is at least two (2)
but shall not exceed fifty (50). A partner shall be liable only to the extent of its share in the
capital.
2. A single natural or corporate person may incorporate and hold a Limited Liability
Company. The holder of the capital of the company shall not be liable for the obligations of
the company other than to the extent of the capital as set out in its Memorandum of
Association. The provisions of the Limited Liability Company contained in this Law shall
apply to such person to the extent not in conflict with the nature of the company.
Article (72) – Name of the Company
1. A Limited Liability Company shall have a name derived from its objective or from the
name(s) of one or more partners, provided that name of the company shall be followed by
the expression “Limited Liability Company” or in short “LLC”. In the event of a sole
proprietorship, the name of the company shall be accompanied with the name of its owner
and followed by the expression “sole proprietorship with limited liability”.
2. If the Manager (or Managers) contravene the provision of Clause 1 of this Article, such
Manager (Managers) shall be jointly liable, in their own assets, for the obligations of the
company and, as applicable, for the compensations.
Article (73) – Memorandum of Association and Incorporation Procedures of the
Company
A Limited Liability Company shall be incorporated and registered as set forth in Articles (42)
and (43) of this Law.
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Article (74) – Register of the Partners of the Company
1. The company shall prepare at its head office a special register of the partners, including:
a) Full name, nationality, date of birth and place of residence of every partner and, if the
partner is a corporate person, the address of its head office;
b) Transactions made on the shares and the dates of such transactions.
2. The managers of the company shall be liable for such register and for the validity of its
particulars. The partners and any concerned party may inspect such register.
3. The company shall dispatch to the competent authority and the registrar in January every
year the particulars entered in the register of partners and such changes thereto during the
last financial year.
Article (75) – Increase of the Number of the Partners
1. If, at any time upon the incorporation of the company, the number of the partners exceeds
the maximum limit in Article (71) of this Law, the Manager or Managers, as the case may
be, shall notify the competent authority within thirty (30) days from the date of such
increase.
2. Other than in the event of transfer of title to the share of a partner by way of inheritance or
Court judgment, the company shall adjust its position within three months from the date of
the notice, and the competent authority may extend such period to another period of three
months, otherwise the company shall be deemed terminated. The partners shall be
personally and jointly liable from their assets for the debts and obligations of the company
from the date of increase of the number of the partners.
3. The provisions of Clause 2 of this Article shall not apply to the partners who prove not to be
aware of such increase or their objection thereto.
Article (76) – Capital of the Company
1. The company shall have sufficient capital to achieve the purpose of its incorporation and
the capital shall consist of shares equal in value. On a proposal made by the Minister in
coordination with the competent authorities, the Cabinet may issue a decision determining
the minimum limit of the capital of the company.
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2. Shares may be in cash and/ or in kind and shall be paid in full at the time of incorporation.
3. The shares in cash shall be deposited in a bank operating in the State. The bank may not pay
such shares other than to the Managers of the company after providing such evidence that
the company has been registered with the competent authority and as provided by the
contract appointing such Managers.
Article (77) – Indivisible Share of the Partner
A share shall be indivisible. If a share is held by several persons without appointing their
representative before the company, the partner whose name appears first in the Memorandum
of Association shall be the representative of such partners. The company may set a time to
make such choice, provided that upon the expiry of such time, the company shall be entitled to
sell the share for the account of its holders, in which event the partners shall have the priority
right to purchase the share. Unless agreed otherwise, if the priority right is used by more than
one partner, the shares shall be divided among them pro rata to their respective shares in the
capital.
Article (78) – Valuation of Contributions in Kind
1. Partners in a Limited Liability Company may provide in consideration to their shares in the
company contributions in kind.
2. The contribution in kind shall be evaluated at the expense of the relevant contributors
thereof, by one or more financial consultants approved by the Authority to be elected by the
competent authority, failing which the assessment shall be void.
3. The competent authority may discuss and object to the evaluation report and appoint
another assessor, as required, at the cost of the partners providing such shares.
4. Notwithstanding the provision of Clause 2 of this Article, the partners may agree on the
value of the share in kind. In such event, such value shall be approved by the competent
authority. The partner providing such contribution shall be liable to third parties for the
evaluation of its value in the Memorandum of Association. If the contributions in kind are
found to be evaluated above their true value, the partner providing such contributions shall
pay the difference in cash to the company.
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Article (79) – Assignment or Pledge of the Share of a Partner in the Company
1. A partner may Assign or pledge its share in the company to another partner or to a third
party. Such assignment or pledge shall be made in accordance with the terms of the
Memorandum of Association of the company under an official document, in accordance
with the provisions of this Law. Such assignment or pledge shall not be valid against the
company or third parties until the date of its entry in the Commercial Register with the
competent authority.
2. The company shall not reject then entry of such assignment or pledge in the register unless
the transfer or pledge violates the provisions of the Memorandum of Association or this
Law.
Article (80) – Procedures of Assignment of the Partner’s Share in the Company
1. If a partner wishes to assign his share to a person who is not a partner, with or without
consideration, such partner shall notify the other partners through the Manager of the
company of the assignee or the purchaser and the terms of the assignment or sale. The
Manager shall notify the partners as soon as he receives the notice.
2. Every partner may demand to pre-empt the share as set forth in Clause 1 of this Article
within thirty (30) days from the date of notifying the Manager of the agreed price. In the
event of dispute on the price, such share shall be assessed by one or more experts with
technical and financial experience in the subject matter of the share, as nominated by the
competent authority on demand by the applicant for pre-emption and at his expenses.
3. If the right of pre-emption is used by more than one partner, the share(s) offered for sale
shall be divided among such partners pro rata to their respective shareholdings, subject to
the provisions of Article (76) of this Law.
4. If the period as set forth in Clause 2 of this Article has lapsed without use of the preemption
right by a partner, the relevant partner shall be free to dispose of his share.
Article (81) – Execution against a Partner’s Share in the Company
If a partner’s creditor commences the execution procedures against the share proceeds of its
debtor, the creditor may agree with the debtor and the company to the method and the terms of
the sale. Otherwise, the share shall be offered for sale at a public auction, upon a request
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submitted to the competent Court. One or more partners may recover the sold share at the same
terms as awarded at the auction, within 15 days from the date on which the auction is awarded.
These provisions shall apply in the event of bankruptcy of a partner.
Article (82) – Liability of a Partner for any Profit or Benefit to the Company
A partner in a limited liability company shall be liable against the company for any of its
properties held by such partner as a trustee or any profits or benefit made through the business
or activities of the company, or by the use of the property, name or commercial relationships of
the company.
Chapter II: Management of the Company
Article (83) – Managers of the Company
1. The management of a limited liability company shall be undertaken by one or more
Managers as determined by the partners in the Memorandum of Association. Such
Managers shall be elected from the partners or third parties. If the Managers are not
appointed in the Memorandum of Association of the company or an independent contract,
the general assembly of the partners shall appoint such Managers. If there is more than one
Manager, the partners may appoint a Board of Directors. Such board shall have such powers
and functions as set out in the Memorandum of Association.
2. Unless the contract appointing the Manager of the company or its Memorandum of
Association or Articles of Association provides for the powers granted to the Manager, such
Manager shall be authorized to exercise full powers to manage the company and his acts
shall be binding to the company, provided that the capacity of Manager is stated upon doing
such acts.
Article (84) – Liability of the Managers of the Company
1. Every partner in a Limited Liability Company shall be liable against the company, the
partners and the third parties for any fraudulent acts by such Manager and shall also be
liable for any losses or expenses incurred due to improper use of the power or the
contravention of the provisions of any applicable Law, the Memorandum of Association of
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the company or the contract appointing the Manager or for any gross error by the Manager.
Any provision in the Memorandum of Association or the contract appointing the Manager
in conflict with the provisions of this Clause shall be deemed void.
2. Subject to the provisions of the Limited Liability Company in accordance with this Law, the
provisions that apply to the Directors of Joint Stock Companies as set forth in this Law shall
apply to the Managers of Limited Liability Companies.
Article (85) – Vacancy of the Office of the Manager
1. Unless the Memorandum of Association of the company or the contract appointing the
manager provides otherwise, the Manager shall be dismissed by Decision of the General
Assembly, whether the Manager is a partner or not. The Court may dismiss the Manager at
the request made by one or more partners in the company if the Court deems that such
dismissal is justified.
2. The Manager may file a written resignation to the General Assembly, with a copy to the
competent authority. The General Assembly shall decide in such resignation within 30 days
from the date of submittal, otherwise his resignation shall be effective upon the expiry of
this period, unless the Memorandum of Association of the company or the contract
appointing the Manager provides otherwise.
3. The company shall notify the competent authority of the termination of services of the
Manager within no later than 30 days from the date of the termination of service. The
company shall appoint another Manager during such period.
Article (86) – Competition of the Company by the Manager
The Manager shall not, without the consent of the General Assembly of the company,
undertake the management of a competing company or a company with objects similar to those
of the company or make, for his own account or for the account of third parties, deals in a trade
in competition or similar to the activity of the company, otherwise the Manager may be
dismissed and required to pay compensation.
Article (87) – Responsibility for Preparing the Accounts
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The Manager of the company shall prepare the annual budget and the profit and loss account,
and shall also prepare an annual report on the affairs and financial position of the company and
provide his recommendations on the distribution of the profits of the General Assembly, within
three months from the end of the financial year.
Article (88) – Appointment of a Supervisory Board
1. If the number of the partners is over seven, the partners shall appoint a Supervisory Board
consisting of at least three partners. The General Assembly may re-elect such partners upon
the expiry of such term or elect other partners in their place. The members of the
Supervisory Board may be dismissed at any time for an acceptable reason.
2. The Managers may not vote on the election or dismissal of the members of the Supervisory
Board.
Article (89) Powers of the Supervisory Board
The Supervisory Board may examine the books and documents of the company and request
from the Managers at any time to provide a report of their management. Such Board shall
control the balance sheet, the annual report and the distribution of the profits. The Board shall
present its report in this regard to the General Assembly of the company at least 5 (five) days
prior to the date of its convention.
Article (90) – Liability of the Members of the Supervisory Board
The Members of the Supervisory Board shall not be held liable for the acts of the Managers or
the results of such acts unless such members were aware of the errors committed and omitted to
state such errors in their report presented to the General Assembly of the partners.
Article (91) – Rights of Partners who are Not Managers
The partners who are not Managers of the Limited Liability Company, where there is no
Supervisory Board, shall have all the rights associated with the description of the partners as
provided by this Law or the Memorandum of Association. Any agreement to the contrary shall
be void.

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Chapter III: General Assembly
Article (92) – Formation of the General Assembly and Inviting It to Convene
1. The Limited Liability Company shall have a General Assembly consisting of all the
partners. The General Assembly shall be convened by an invitation from the Manager or the
Board of Directors at least once in a year during the four months following the end of the
financial year of the company. The General Assembly shall be convened at such time and
place as set out in the letter inviting to convene the meeting.
2. The Manager or authorized Manager shall invite the General Assembly to convene upon the
request of one or more partners holding at least one quarter of the capital.
Article (93) – Notification of the Invitation to Hold the General Assembly
Other than the General Assembly adjourned due to absence of quorum in accordance with the
provisions of Article (96) of this Law, invitation to convene the General Assembly may be
given by registered letters or by any other means as provided by the Memorandum of
Association, at least 15 (fifteen) days prior to the date as scheduled to hold the General
Assembly, or within any shorter period as agreed by all the partners.
Article (94) – Agenda of the Annual General Assembly
The Agenda of the Annual General assembly of a Limited Liability Company shall include the
consideration and decision-making in the following issues:
1) The Managers’ report regarding the activity and the financial position of the company
during the ended financial year, the auditor’s report and the Supervisory Board’s report;
2) The balance sheet and the account of profits and losses and the approval thereof;
3) The profits to be distributed among the partners;
4) To appoint the Managers and to determine their remuneration;
5) To appoint the members of the Board of Managers (if any);
6) To appoint the members of the Supervisory Board (if any);
7) To appoint the members of the Internal Shariah Control Committee and the Shariah
Controller if the company conducts its activity in accordance with the provisions of the
Islamic Shariah;
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8) To appoint and determine the remuneration of the auditor(s); and
9) Any other matters within the powers of the General Assembly in accordance with the
provisions of this Law or the Memorandum of Association of the company.
Article (95) – Attendance at the Meeting of the General Assembly
Irrespective of the number of the shares held by him, every partner shall have the right to attend
the General Assembly in person and may delegate another partner who is not a manager or any
other party that the Memorandum of Association permits to be appointed to represent a partner
at the General Assembly to do so. Every partner shall have a number of votes equal to the
number of the shares held or represented by such partner.
Article (96) – Quorum for Convene and Voting
1. Quorum at the General Assembly shall not be valid unless one or more partners holding at
least 75% of the capital of the company are present.
2. If such quorum as set forth in Clause 1 of this Article is not present at the meeting, the
partners shall be invited to another meeting, to be held within 14 days from the date of the
first meeting, provided that at least 50% of the capital is present at the meeting.
3. If quorum as set forth in Clauses 1 and 2 of this Article is not present, the partners shall be
invited to a third meeting to be held upon the expiry of 30 days from the date of the second
meeting. Quorum at the third meeting shall be valid irrespective of the partners present at
the meeting.
4. The Decisions by the General Assembly shall not be valid unless passed by the majority of
the partners present in person and those represented at the meeting, unless the
Memorandum of Association provides for a higher majority.
Article (97) – Listing a New Issue in the Agenda of the General Assembly
The General Assembly may not discuss any issues other than those listed in the Agenda, unless
serious issues that require consideration are found during the meeting. If, at the beginning of
the meeting, a partner demands to list a certain issue in the Agenda, the managers shall respond
to the request, failing which such partner may appeal to the General Assembly.
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Article (98) – Discussion of the Issues listed on the Agenda of the General Assembly
Every partner may discuss the issues listed on the Agenda. The Managers shall be bound to
respond to the questions by the partners to the extent not to cause damage to the interests of the
company. If a partner sees that the reply to his question is not adequate, such partner may
appeal to the General Assembly. The Decision by the General Assembly shall be binding.
Article (99) – Voting to Discharge a Managing Partner
A managing partner may not vote on the Decisions to discharge him from liability for the
management.
Article (100) – Register of the Meetings of the General Assembly
Minutes accurately summarizing all the discussions of the General Assembly shall be drawn,
the minutes and Decisions shall be recorded in a special register to be kept at the head office of
the company. Any partner may inspect the minutes in person or by proxy and may also inspect
the balance sheet, the profit and loss account and the annual report.
Article (101) – Amendment to the Memorandum of Association of the Company and
the Increase or Decrease of its Capital
The Memorandum of Association of the company may not be amended and its capital may not
be increased or decreased other than with the consent of a number of partners representing
three quarters of the shares represented at the meeting of the General Assembly. The rate of
such increase or decrease shall be pro rata to the shares of the partners of the company, unless
agreed otherwise. However, the financial obligations of the partners may not be increased other
than by their unanimous consent.
Article (102) – Auditor of the Company
A Limited Liability Company shall have one or more auditors to be elected by the General
Assembly of the partners every year and, other than as provided by Article (244) of this Law,
the provisions concerning the auditors in public joint stock companies shall apply to the auditor
of a Limited Liability Company. The expression “Competent Authority” shall substitute the
term “Authority” wherever it appears.
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Article (103) – The Legal Reserve
A Limited Liability Company shall set aside in every year 10% of its net profits to form a legal
reserve. The partners may decide to stop such deduction if the reserve reaches half the capital.
Article (104) – Application of the Provisions of the Joint Stock Companies
Unless otherwise provided by this Law, the provisions concerning Joint Stock Companies shall
apply to the Limited Liability Company. The expression “Competent Authority” shall
substitute the term “Authority” wherever it appears.

TITLE IV. PUBLIC JOINT STOCK COMPANIES
Chapter I: Definition and Incorporation of the Public Joint Stock Company
Article (105) – Definition of the Company
A Public Joint Stock Company is a company whose capital is divided into equal and negotiable
shares. The founders shall subscribe to part of such shares while the other shares are to be
offered to the public under a public subscription. A shareholder shall be liable only to the
extent of his share in the capital of the company.
Article (106) – Name of the Company
Every Public Joint Stock Company shall have a trade name, which may not be a name of a
natural person unless the objective of the company is to invest an invention patent registered in
the name of such person and/or if the company holds a trade name or obtained the right to use
such name. In all events, the expression “Public Joint Stock Company” shall be added to the
name of the company.
Article (107) – Number of Founders
1. Five or more persons may form a Public Joint Stock Company.
2. The Federal Government, the Local Government and any company or entity fully held by
the Federal Government or Local Government may be a shareholder of a Public Joint Stock
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Company or incorporate by itself a Public Joint Stock Company, and may also join, in
contribution to the capital, a number less than as provided by Clause 1 of this Article.
3. The conversion of any company to a Public Joint Stock Company shall be exempted from
the minimum limit stated in Clause 1 of this Article.
Article (108) – Term of the Company
The term of the company shall be determined in its Memorandum of Association and Articles
of Association. Under a special Decision, such term may be extended or shortened if the object
of the company so requires.
Article (109) – The Founder
1. A founder is such person who signed the Memorandum of Association of the company and
holds a percentage of its capital in cash or provided contributions in kind at the time of
incorporation, subject to the provisions of this Law.
2. The founder shall be liable to any damages suffered by the company or third parties due to
the contravention of the incorporation rules and procedures. The founders shall be jointly
liable for such damage. Any person delegated in the incorporation process shall be liable in
person if he omits to state the name of the principal or the instrument of delegation proves
to be invalid.
Article (110) – Memorandum and Articles of Association of the Company
1. The founders shall draft the Memorandum and Articles of Association of the company,
including the following particulars:
a) The name and the head office of the company;
b) The objective for which the company is incorporated;
c) The full name, nationality, date of birth, place of residence and address of each
founder;
d) The amount of the capital and the number of the shares, the nominal value per share and
the amount paid from the value of each share;
e) An undertaking by the founders to procure to complete the incorporation procedures;
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f) An estimate of the amount of expenses, charges and costs expected to be spent on the
incorporation process, to be paid by the company by virtue of its incorporation;
g) A statement of the contributions in kind, the name of the provider thereof, their initial
value, the conditions of such provision and the rights of pledge lien attached thereto, if
any.
2. The Memorandum of Association and Articles of Association of the company shall be
compliant with the Law and the Decisions issued in execution hereof and shall include the
provisions, jurisdictions and powers of the Board of Directors and the General Assembly of
the company. The Authority may issue the form of the Memorandum of Association and
Articles of Association of the company. The companies shall comply with such a form.
Article (111) – Shareholders’ Compliance with the Articles of Association
1. Subject to the provisions of this Law, the Articles of Association of the company shall,
upon its registration in the Commercial Register with the competent authority, be binding to
all its shareholders.
2. Any amount due from a shareholder to the company in accordance with the provisions of
the Articles of Association shall be a debt payable by such shareholder to the company.
Article (112) – Founders Committee
1. The founders shall choose from their number a committee consisting of at least three
members to complete the incorporation procedures and to register the company with the
relevant authorities. The Founders Committee, the consultants and the parties involved in
the incorporation procedures and their representatives shall be fully liable for the accuracy,
validity and completion of all the documents, studies and reports provided to the relevant
authorities in connection with the incorporation, licensing and registration process of the
company.
2. The Founders Committee may delegate one of its members or a third party to follow and
complete the incorporation procedures with the Authority and the competent authority
according to such conditions laid by the Authority in this respect.
3. The Founders Committee shall appoint a Financial Consultant, a Legal Consultant and an
Auditor for subscription.
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Article (113) – Incorporation procedures before the Competent Authority
1. The Founders Committee shall submit the application for incorporation to the competent
authority, together with the Memorandum of Association and Articles of Association of the
company, the economic feasibility of the project to be established by the company, the
proposed timetable to perform such project and any other documents required by the
competent authority.
2. The competent authority shall consider the application for incorporation and issue its initial
approval of the application or reject it and shall notify the Founders Committee within 10
(ten) working days from the date of the application if the application is satisfactory or from
the date of completing the required documents or statements. The failure of the competent
authority to issue its initial approval during such period shall be deemed as rejection of the
application for incorporation.
3. If the competent authority rejects the application for incorporation or the period as set forth
in Clause 2 of this Article expires without deciding on the application, the Founders
Committee may file a grievance before the Director General of the competent authority or
his representative within 10 (ten) working days. If the grievance was rejected or was not
settled within 15 (fifteen) working days from the date of filing the grievance, the Founders
Committee may appeal, before the Competent Court, the Decision of rejection issued by the
competent authority within 30 (thirty) days from the date of notifying the committee of the
Decision of rejection or from the expiry date of the said period if no such Decision is
issued.
Article (114) – Incorporation Procedures before the Authority
1. The Founders Committee shall submit to the Authority the application for incorporation
accompanied with the initial approval of the competent authority, together with the
Memorandum of Association and Articles of Association of the company, the economic
feasibility of the project to be established by the company, the proposed timetable to
perform such project, the prospectus and any approvals by the relevant authorities in
connection with the application, according to the applicable requirements of the Authority.
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2. The Authority shall consider the application for incorporation and notify the Founders
Committee of its notes on the application for incorporation and its documents within 10
(ten) working days from the date of submitting a satisfactory application or from the date on
which the assessor appointed by the Authority presents its final report in assessment of the
contributions in kind, if any. The Founders Committee shall complete any deficiency or
make such amendments as the Authority may deem necessary to complete the application
for incorporation, within 15 (fifteen) working days from the date of the notice, failing which
the Authority may consider this as waiver of the application for incorporation.
3. The Authority shall send a copy of the application and its documents to the competent
authority within 10 (ten) working days from the date of completing the application to be
considered. Then, the Authority shall meet with the competent authority within 10 (ten)
working days from the date of sending the application to the Authority. If the competent
authority has any notes thereon, the Authority shall notify the Founders Committee thereof
and complete the deficiency or make such amendments as the competent authority may
require to complete the application for incorporation within 10 (ten) working days from the
date of notifying the Founders Committee, failing which the Authority may consider this as
waiver of the application for incorporation. The Authority shall confirm that the application
and all the documents and notes are satisfactory. The amended copy shall be sent to the
competent authority.
Article (115) – Authentication of the Memorandum of Association
The Founders Committee shall authenticate the Memorandum of Association in accordance
with the provisions of this Law and provide to the Authority a copy of the Memorandum of
Association and a copy of the Decision issued by the competent authority concerning the initial
approval of the license and a certificate issued by a bank licensed to operate in the State,
confirming that the founders have paid the amounts payable by them, prior to the approval of
the prospectus by the Authority.
Article (116) – Amendment to the Particulars of the Application for Incorporation
No amendment to the particulars of the application for incorporation may be made upon
submitting the application to the competent authority within any stage of the incorporation
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process, whether the capital or objectives of the company, the names of the founders or any
other particulars in the application for incorporation. If this occurs, the matter shall be referred
to the competent authority to take the appropriate action.
Article (117) – Contribution by the Founders to the Capital of the Company
1. The founders shall subscribe to shares from 30% to 70% of the issued capital of the
company, prior to the invitation to the Public Subscription to the remaining shares of the
company.
2. The founders may not subscribe to the shares offered for Public Subscription.
Article (118) – Valuation of the Contribution in Kind
1. The founders of the company may provide contributions in kind in consideration of their
shares in the company.
2. The contributions in kind shall be assessed at the expense of those providing them by one or
more financial consultants to be elected by the Authority from the financial consultants
approved by the Authority or by such entities with financial and technical experience in the
subject matter of valuation, as approved by the Authority, failing which the valuation shall
be void.
3. The assessor may inspect any information or documents as the assessor may deem
necessary to enable the assessor to make the required evaluation and to prepare the
evaluation report efficiently. The Founders Committee or, as applicable, the Board of
Directors shall take the required procedures to provide it with the required information,
documents and instruments as soon as possible from the date of the application.
4. The assessor, the Founders Committee and the Board of Directors (if any) shall be fully
liable for the accuracy, adequacy and completion of the statements and information
contained in the assessment report.
5. The Authority may discuss and object to the assessment report. The Authority may appoint
another assessor as required at the cost of the company under incorporation.
6. The share/ contributions in kind provided by a public person may be a franchise or right to
use some public funds.
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Article (119) – Valuation of the Contributions in Kind Following Incorporation
The valuation of the contributions in kind following the incorporation of the company shall be
governed by the same valuation provisions in this Law.
Article (120) – Exaggeration in the Valuation of the Contributions in Kind
1. If the Authority confirms that there is any exaggeration or negligence upon the valuation of
the contributions in kind by the assessor, the Authority may:
a) Prevent the assessor from conducting the activity of valuation with the Authority for a
period of at least two years.
b) Prevent the assessor from conducting the activity of valuation with the Authority
permanently in the event of recurrence of the contravention.
2. The assessor may file a grievance against the Decision of the Authority, before the
Chairman of the Authority within 15 (fifteen) working days from the date of his notification
of either Decision as set out in Clause 1 of this Article. If the Chairman of the Authority
rejects the grievance or omits to decide it within 15 (fifteen) working days from the date of
filing the grievance, the assessor may file an appeal before the Competent Court within 30
(thirty) days from the date of rejecting the grievance or expiry of the period during which
the grievance should be considered, as the case may be.
Article (121) – Invitation to Public Subscription
1. The prospectus shall be signed by the Founders Committee, the consultants and the parties
involved in the incorporation procedures and their representatives and shall be jointly liable
for the validity of the information as set out in the prospectus.
2. Invitation to the public subscription shall be made under a prospectus to be published in two
daily local newspapers, one of them is issued in Arabic, at least 5 (five) working days prior
to the date of commencing the subscription.
3. Subscription to the shares shall be made under an application whose particulars shall be
determined by the Authority and, in particular, the application shall include the name,
objective and capital of the company, the conditions of subscription, the name, address in
the State, profession and nationality of the subscriber, the number of the shares proposed to
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be subscribed thereto by him and his undertaking to accept the provisions of the
Memorandum of Association and Articles of Association of the company.
Article (122) – Entities Authorized to receive Subscriptions
1. Subscription with the licensed entity/ entities licensed to do so in the State, as determined
by the Founders Committee in the prospectus. Subscription may be made electronically as
determined by the Authority in this respect.
2. The entity/ entities receiving subscriptions shall withhold the monies paid by the
subscribers and the revenues from the amounts of subscription to the shares for the account
of the company under incorporation. Such monies may not be paid to the Board of Directors
of the Company until the Authority issues a certificate of incorporation and the registration
of the company in the Commercial Register with the competent authority.
Article (123) – Underwriters
1. Without prejudice to the provisions of Article (10) of this Law, the company may have,
upon incorporation or upon increasing its capital, one underwriter or more certified by the
Authority to underwrite what has been left from the subscription shares. He may re-offer
what has been subscribed form the shares in accordance with the conditions, terms and
procedures issued by a Decision from the Authority.
2. A Decision is issued by the Chairman of the Authority in the terms and conditions of
practicing the underwriting activity in the State.
Article (124) – The Period of Subscription
1. Subscription shall remain open for at least 10 working days and not exceeding 30 working
days.
2. If all shares put to subscription are not taken within the scheduled period, the Founders
Committee may apply to the Authority for approval to extend the period of subscription for
an additional period not to exceed 10 (ten) working days if there is no underwriter.
3. If such additional period expires without taking all the shares offered for public subscription
and the founders have not subscribed to the maximum applicable limit as provided by
Article (117) of this Law, the founders may subscribe to the balance part of such applicable
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percentage, failing which the Decision issued by the Authority in approval of the
incorporation shall be void.
Article (125) – Distribution of the Shares to the Subscribers
If subscription exceeds the number of the shares offered, the shares may be distributed to the
subscribers pro rata to their respective subscriptions or as determined in the prospectus, as
approved by the Authority. The distribution shall be made according to the nearest whole
number.
Article (126) – Share Allocation and Repayment of Excess Amounts
Entities licensed to receive subscriptions shall, upon closure of subscription:
1) Allocate the shares to the subscribers within no later than 5 (five) working days from the
date of closing the subscription.
2) Repay the extra amounts paid by the subscribers and the revenues thereon, for which no
shares are allocated, within no later than 5 (five) working days from the date of allocating
the shares to the subscribers.
Article (127) – Subscription by Emirates Investment Authority
Emirates Investment Authority shall be entitled to subscribe to shares in any public Joint Stock
Company incorporated in the State and offering its shares for public subscription, within the
limit of 5% of the shares offered for public subscription, provided that the value of such shares
shall be paid prior to closing the subscription and that the Authority is provided with evidence
to such payment.
Article (128) – Declaring the Non Incorporation of the Company
Unless the company is incorporated, the Authority shall declare this to the public. As a result of
such declaration:
1) The subscribers shall have the right to recover the amounts paid by them within ten working
days from the date of the declaration and the revenues thereof. The founders shall be jointly
liable for payment of such amounts and, if applicable, compensation.
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2) The founders shall bear such expenses paid for the incorporation of the company and they
shall be jointly liable against third parties for such acts carried out by the founders during
the incorporation period.
Article (129) – Book Building of Securities
Subject to the provisions of Articles (117) and (279) of this Law, the Authority may issue a
Decision to regulate the mechanism of subscription on the basis of the Book Building of
securities. Entities wishing to follow such method shall comply with the provisions and
procedures contained in the Decision issued by the Authority in this respect.
Article (130) – Incorporation Expenses
The company shall bear all the expenses paid by the Founders Committee for the incorporation
of the company and issuing its securities. The detailed statement of such expenses shall be
referred to the Constituent General Assembly of the company for consideration and approval.
Article (131) – Constituent General Assembly
1. The Founders Committee shall invite the shareholders to hold a meeting of the Constituent
General Assembly of the company within no later than 15 (fifteen) days from the date of
closing the subscription.
2. If the period as set forth in Clause 1 of this Article expires without such invitation by the
founders, the Authority shall invite the General Assembly at the expenses of the company.
3. Unless the Articles of Association of the company determine a higher percentage, quorum
at the Constituent General Assembly shall be present if shareholders holding in person or
representing by proxy at least 50% of the capital of the company are present at the meeting.
If quorum is not present, the meeting shall be adjourned for a period between 5 (five) days
and 15 (fifteen) days from the date of the first meeting. The adjourned meeting shall be
valid irrespective of the number of the present shareholders.
4. The meeting shall be chaired by such person elected by the Constituent General Assembly
for such purpose from among the founders.
5. The Decisions of the Constituent General Assembly shall be passed by the majority votes of
shareholders holding at least three quarters of the shares represented at the meeting.
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Article (132) – Agenda of the Constituent General Assembly
In particular, the Constituent General Assembly shall consider and take decisions in the
following issues:
1) The founders’ report concerning the procedures and the costs of the incorporation of the
company.
2) The acts of the founders in connection with the company during the incorporation period.
3) To approve the incorporation of the company.
4) To elect the members of the first Board of Directors if not appointed by the founders.
5) To appoint the auditors if not appointed by the founders.
6) To appoint the members of the Internal Shariah Control Committee and the Shariah
Controller if the company conducts its business in accordance with the provisions of the
Islamic Shariah, if not appointed by the founders.
Article (133) – Application to issue the Certificate of Incorporation
The Board of Directors of the company shall, within 10 (ten) working days from the date of
convening the Constituent General Assembly, provide an application to the Authority to issue a
certificate of incorporation, together with:
1) A report by the entity that audited the subscription accounts.
2) An acknowledgement by the Founders Committee of the complete subscription of the share
capital in full, the amounts paid by the subscribers from the value of the shares and a
statement of the names and nationalities of the subscribers and the number of shares
subscribed by each subscriber.
3) A bank certificate confirming that the amount payable from the capital of the company has
been deposited.
4) A statement of the names of the members of the Board of the company and an
acknowledgement by them that their membership is not in conflict with the provisions of
this Law and the Decisions issued hereunder.
5) A statement of the names of the members of the Internal Shariah Control Committee and
the Shariah Controller if the company conducts its business in accordance with the
provisions of the Islamic Shariah.
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6) Minutes of the meeting of the Constituent General Assembly.
7) Any other documents as required by the Authority.
Article (134) – Issuing the Certificate of Incorporation
In the event of completion of the documents as set forth in Article (133) of this Law, the
Authority shall issue a certificate of incorporation of the company within 5 (five) working days
from the date of submitting a complete application by the Board of Directors of the company.
Article (135) – Registration of the Company with the Competent Authority
1. The Board of Directors of the company shall within 10 (ten) working days from the date of
issue by the Authority of the certificate of incorporation, take its registration procedures
before the competent authority.
2. The competent authority shall enter the company in the Commercial Register and issue a
commercial license for the company within 5 (five) working days from the date of
completion of the documents and payment of the fees, and shall notify the Authority by a
copy of the commercial license.
Article (136) – Notification of the Registrar
The Chairman of the company shall, within 5 (five) working days from the date of issue by the
competent authority of the commercial license, notify the registrar of the certificate of
incorporation, the Memorandum of Association and Articles of Association of the company
and its commercial license to be entered in the Companies Register and to be published at the
cost of the company according to the conditions laid by the Minister in this respect.
Article (137) – Listing the Shares of the Company in the Financial Market
1. The Board of Directors of the company that offered shares for public subscription shall,
within 15 (fifteen) working days from the date of its registration in the Commercial Register
at the competent authority, list the shares of the company in one of the financial markets
licensed in the State according to the listing rules and regulations applicable at the
Authority and the financial market where its shares are to be listed.
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2. Companies listed in a financial market in the State shall comply with the applicable Laws
and regulations at the financial market.
Article (138) – Acts by the Founders
Upon its registration in the Commercial Register with the competent authority, the effects of all
the acts by the founders for the account of the company prior to the registration shall be
transferred to the company. The company shall bear all the expenses paid by the founders in
this respect.
Article (139) – Amendment to the Memorandum of Association or Articles of Association
of the Company
Subject to the provisions of this Law, the company may, with the consent of the Authority and
the competent authority, issue a special Decision to amend its Memorandum of Association or
Articles of Association.
Article (140) – Inspection of Statements and Information
1. The company shall provide a copy of its Memorandum of Association and Articles of
Association on the website of the company and any documents or other information as
determined by the authority.
2. The company shall send a copy of its Memorandum of Association and Articles of
Association to any shareholder that may so demand, at his own expenses.
Article (141) – Register of the Shareholders and Records of the Company
1. Every company shall keep a register of its shareholders in accordance with the conditions
laid by the Authority.
2. The Authority may inspect the register of shareholders and the books, documents and
records of the company.
Article (142) – Purchase of Assets during the First Financial Year
If, prior to the approval by the General Assembly of the accounts of the first financial year, the
company purchases assets, companies or establishments for an amount exceeding 20% of the
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capital of the company in aggregate, the Board of Directors shall notify the Authority thereof.
The Authority may subject such assets, companies or establishments to assessment in
accordance with the provisions of this Law.

Chapter II: Management of the Public Joint Stock Company
Article (143) – Formation of the Board of Directors
1. The management of the company shall be undertaken by a Board of Directors. The Articles
of Association of the company shall determine the method of formation of the Board of
Directors, the number of its members and the term of membership, provided that the
number of the members shall not be less than three and shall not exceed eleven and that the
term of membership shall not exceed three Gregorian calendar years, commencing from the
date of election or appointment. Members may be re-elected for more than one term.
2. The Board of Directors shall elect from its members by secret ballot a Chairman and a
Deputy Chairman to substitute the Chairman in the event of his absence or if there is a
preventive. A Managing Director of the company may be elected, and this Managing
Director may not be an Executive Officer or a General Manager of another company.
3. The Board of Directors shall notify the Authority of the Decisions for electing the
Chairman, the Deputy Chairman and the Managing Director. It is also required to obtain the
approval of the Central Bank on such Decisions in the event of companies licensed by it.
4. The company shall have a Secretary of the Board of Directors who is not a member of the
latter.
5. The Board of Directors of the Authority shall issue a Decision stating the terms and
conditions that the companies shall comply therewith for the formation of their Boards of
Directors and the nominations to its membership. In the event of companies licensed by it,
the Central Bank shall issue the required Decision in this respect.
Article (144) – Election of the Members of the Board
1. Subject to the provisions of Article (143) of this Law, the General Assembly shall elect the
members of the Board by way of cumulative voting by secret ballot. Notwithstanding this,
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the founders may appoint the members of the first Board of Directors in the Articles of
Association of the company.
Cumulative voting shall mean that each shareholder shall have a number of votes equivalent
to the number of shares held by him so that he votes to one candidate for the membership of
the Board or may distribute his votes among the selected candidates, provided that the
number of votes granted to the candidates does not exceed the number of votes owned by
him.
2. The General Assembly may appoint a number of experienced persons in the Board of
Directors other than the shareholders of the company, provided that such members shall not
exceed one third of the number of members as determined in the Articles of Association.
3. Every company shall keep a register of the members and the Secretary of the Board at its
Head Office. The Authority shall determine such particulars required to be available in such
register.
4. The register of the members and the Secretary of the Board of the company as set forth in
Clause 3 of this Article shall be made available for inspection by any shareholder or
member of the Board of the company, free of charge, during the working hours, subject to
any reasonable entries as may be imposed by the company under the Articles of
Association.
Article (145) – Vacancy of the Position of a Member of the Board
1. If the office of a member of the Board becomes vacant, the Board of Directors shall, subject
to the provisions of Article (143) of this Law, appoint a new member to hold the vacant
position, provided that such appointment shall be referred to the General Assembly at its
first meeting to approve such appointment or appoint another member, unless the Articles
of Association of the company provides otherwise. The new member shall complete the
term of its predecessor.
2. If the vacant positions reach one quarter of the number of members of the Board, the
remaining members shall invite the General Assembly to convene within no later than 30
(thirty) days from the date of vacancy of the last office to elect new members to fill such
vacancies.
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Article (146) – Mechanism of Voting to Elect the Members of the Board
Every shareholder in the company shall have a number of votes equal to the number of shares
held by such shareholder. The Authority shall issue a Decision to determine the mechanism of
voting at the General Assemblies to elect the members of the Boards.
Article (147) – Nominations for the Membership of the Board
No person may be appointed or elected as a member of the Board of the company until such
person acknowledges in writing his acceptance of the nomination, provided that such
acknowledgement shall include a disclosure of any activity conducted directly or indirectly by
such person in competition of the business of the company and of the names of the companies
and establishments where such person works or is a member of the Board.
Article (148) – Government Membership in the Board of Directors
Notwithstanding the provisions of Article (143), the Federal Government or the Local
Government may, if it holds 5% or more of the capital of the company, appoints its
representatives at the Board of Directors pro rata to such percentage from the number of the
Board members, but at least one member if the required percentage to appoint a member
exceeds such percentage and it shall forfeit its right in the voting in the percentage of its
appointment. If the Government holds any balance percentage not qualifying to appoint another
member, the Government may use such percentage in voting.
Article (149) – Membership in the Board of Directors of Several Joint Stock Companies
1. No person shall, in his personal capacity or in his capacity as the representative of a
corporate person, be a member of the Board of more than five Joint Stock Companies based
in the State, or be a Chairman or Deputy Chairman of more than two companies based in
the State. Such person may not be a Managing Director of more than one company based in
the State.
2. The office of any member that may contravene the provision of Clause 1 of this Article in
respect of the Boards of Directors of companies in excess of the legal limit shall be annulled
due to his recent appointment. Such contravening member shall repay to the company
where his membership is annulled such amounts received by him from the company.
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Article (150) – Notification of Conflict of Interests by a Member of the Board
1. Every member of the Board of the company that may have a common interest or a
conflicting interest in a transaction referred to the Board of Directors for approval shall
notify the Board of Directors of such interest and his acknowledgement shall be entered in
the minutes of the meeting. Such member may not vote on the Decision concerning such
transaction.
2. If a member of the Board fails to notify the Board in accordance with the Provision of
Clause 1 of this Article, the company or any of its shareholders may apply to the Competent
Court to annul the contract or to require the contravening member to pay any profit or
benefit made by him from such contract to the company.
Article (151) – Nationality of the Members of the Board
The Chairman and the majority of the members of the Board shall be UAE nationals. If the
percentage of the UAE members falls below the applicable percentage under this Article, such
deficiency shall be completed within no later than three months, failing which the Decisions of
the Board of Directors shall be void upon the expiry of such period.
Article (152) – Prohibited Dispositions by the Related Parties
1. The related parties shall not utilize the information in the possession of any of them due to
its membership or occupation to achieve any interest whatsoever for them or for others as a
result of dealing in the securities of the company and any other transactions. Such party or
employee may not have a direct or indirect interest with any party making deals intended to
influence the rates of the securities issued by the company.
2. The company may not make transactions with the related parties without the consent of the
Board of Directors not exceeding 5% of the capital of the company and with the consent of
the General Assembly of the company for the excess thereof. Otherwise, the transactions
shall be assessed by an assessor approved by the Authority.
3. The member of the Board may not, without the consent of the General Assembly of the
company, which consent shall be renewed every year, participate in any business in
competition with the company or trade for his own account or for the account of third
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parties in any branch of the activity conducted by the company, and shall not reveal any
information or statements related to the company, otherwise the company may demand him
to pay compensation or to consider the profitable transactions made for his account as if it
were made for the account of the company.
Article (153) – Prohibition of Loans to the Members of the Board
1. The Joint Stock Company may not provide any loans to any member of the Board or
execute guarantees or provide any collateral in connection with any loans entered granted to
them. A loan shall be deemed to be granted to a member of the Board in accordance with
the provisions of this Law any loan granted to his spouse, children or relative up to the
second degree.
2. No loan may be granted to a company where a member of the Board or his spouse, children
or any of his said relatives up to the second degree holds, jointly or severally, over 20% of
the capital of that company.
3. Any agreement in conflict with the provisions of this Article shall be invalid. The auditor
shall refer in his report presented to the General Assembly of the company to such loans
and the credits granted to the members of the Board and the extent of compliance by the
company with the provisions of this Article.
Article (154) – Powers of the Board of Directors
The Board of Directors shall have all the required powers to do such acts as required for the
object of the company, other than as reserved by this Law or the Articles of Association of the
company to the General Assembly. However, the Board of Directors may not enter into loans
for periods in excess of three years, sell or pledge the property of the company or the store,
mortgage the company’s movable and immovable properties, discharge the debtors of the
company from their obligations, make compromise or agree on arbitration, unless such acts are
authorized under the Articles of Association of the company or are within the object of the
company by nature. In other than these two events, such acts require to issue a special decision
by the General Assembly.
Article (155) – Representation of the Company
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1. The Chairman of the company shall be the legal representative of the company before the
Courts and in its relationships with third parties, unless the Articles of Association of the
company provides that its General Manager shall be the representative of the company
before the Courts and in its relationships with third parties.
2. The Chairman may delegate another member of the Board with some of his powers.
3. The Board of Directors may not delegate to the Chairman all the powers of the Board in an
absolute manner.
Article (156) – Meetings of the Board
1. The Board of Directors shall meet at least 4 (four) times a year under an invitation by the
Chairman, unless the Articles of Association of the company provides for more meetings, in
accordance with the procedures as provided by the Articles of Association of the company.
However, the Chairman may invite the Board to convene whenever at least two members so
demand, unless the Articles of Association of the company provides otherwise.
2. The meetings of the Board shall be held at the head office of the company, unless the Board
deems otherwise. The Board meeting shall not be valid unless all the members are invited to
the meeting and their majority are present in person, unless the Articles of Association of
the company permit to participate in the meetings by such modern means of technology as
approved by the Authority.
Article (157) – Board Decisions
1. The Board Decisions shall be passed by the majority votes and in the event of parity, the
Chairman shall have a casting vote.
2. Notwithstanding the provision of Clause 2 of Article (156) of this Law, the Board of
Directors may issue some Decisions by circulation, in accordance with such terms and
conditions as decided by the Authority in this respect.
Article (158) – Absent Member of the Board
If a member of the Board is absent from the meetings of the Board for three successive
meetings or five intermittent meetings within the period of the Board without any excuse
acceptable to the board, such member shall be deemed as resigned.
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Article (159) – Minutes of the Board of Directors Meetings
The Secretary of the Board of Directors shall prepare the minutes of the meetings. Such
minutes shall be signed by the present members and the Secretary. The member who disagrees
to a decision passed by the Board may enter his objection in the minutes of the meeting. The
signatories to such minutes shall be liable for the validity of the statements contained therein.
The Authority shall lay the required conditions in this respect.
Article (160) – Delegation of a Member to attend the Board Meetings
1. A member of the Board may not delegate another member to attend the Board meetings
unless the Articles of Association of the company so permits, provided that the delegated
member represents only one other member and that the number of the members present in
person is at least 50% of the number of the Board members.
2. No voting by correspondence shall be allowed. A delegated member shall vote on behalf of
the absent member as determined in the deed of proxy.
Article (161) – Liability of the Company for the Acts of the Board of Directors
The company shall be bound by the acts of the Board of Directors within the limits of its
powers. The company shall also be liable for the damage due to unlawful acts by the Chairman
and members of the Board of the company.
Article (162) – Liability of the Board of Directors
1. The members of the Board shall be liable towards the company, the shareholders and the
third parties for all acts of fraud, misuse of power, and violation of the provisions of this
Law or the Articles of Association of the company or an error in management. Every
provision to the contrary shall be invalid.
2. Liability as provided for in Clause 1 of this Article shall apply to all the members of the
Board if the error arises from a Decision passed unanimously by them. However, in the
event of the decision passed by the majority, the members who object to such decision shall
not be held liable provided they state their objection in writing in the minutes of the
meeting. Absence from a meeting at which the decision has been passed shall not be
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deemed a reason to be relieved from liability unless it is proven that the absent member was
not aware of the Decision or could not object to it upon becoming aware thereof.
Article (163) – Acts of the Member of the Board
The company shall be bound by the acts of the member of the Board as against a bona fide
third party, even if it is found thereafter that the procedures of election or appointment of the
member are invalid or the applicable conditions for such election or appointment are not
available.
Article (164) – Acts harmful to the Interests of the Company
1. If one or more shareholders holding at least 5% of the shares of the company deem that the
affairs of the company are or have been conducted to the detriment of the interests of all or
any of the shareholders, or that the company intends to do or omit to do any act that may
cause damage to a shareholder, such shareholder shall have the right to provide an
application to the Authority, together with the supporting documents to issue such relevant
decisions at its own discretion.
2. If the Authority rejects the application or the application is not considered within 30 (thirty)
working days, the shareholder or shareholders may resort to the Competent Court within 10
(ten) days from the date of rejecting the application or the expiry of such period, as the case
may be.
3. The Authority may resort to the Competent Court if it believes that the affairs of the
company are or have been conducted to the detriment of the interests of all or any of the
shareholders, or that the company intends to do or omit to do any act that may cause
damage to the shareholders.
4. The competent Court shall hear the lawsuit filed by the shareholder or the Authority as a
matter of urgency in both events as set forth in Clauses 2 and 3 of this Article. The Court
may appoint one or more experts to provide a report on one or more transactions of
management. The Court may issue a judgment to annul the act or omission to act, the
subject matter of the application, or to continue to do any act that it omitted to do.
Article (165) – Lawsuits by the Company
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The company may file a liability lawsuit against the Board of Directors due to the errors that
may result in damages to all the shareholders, under a decision issued by the General Assembly
to appoint a representative of the company to initiate the lawsuit in the name of the company.
Article (166) – Lawsuits by the Shareholder
Every shareholder may file the liability lawsuit individually against the Board of Directors if
not filed by the company, provided that the error may cause private damage to him as a
shareholder and that such shareholder shall notify the company of his intention to file the
lawsuit. Every provision in the Articles of Association of the company to the contrary shall be
invalid.
Article (167) – Liability Nonsuit
Any decision passed by the General Assembly to relieve the Board of Directors shall not
prevent the filing of the liability lawsuit against the Board of Directors due to the errors
committed by them during the performance of their duties. If the act giving rise to liability has
been presented to and approved by the General Assembly, the liability lawsuit shall be forfeited
upon the expiry of one year from the date of such meeting. However, if the act ascribed to the
members of the Board is a criminal act, the lawsuit shall not be forfeited until the public case is
forfeited.
Article (168) – Dismissal of the Members of the Board
1. The General Assembly may dismiss all or any of the members of the Board, even if the
Articles of Association of the company provides otherwise. In such event, the General
Assembly shall elect new members of the Board instead of those dismissed, subject to the
provisions of Articles (143) and (144) of this Law. The Authority and the Competent
Authority shall be notified of such election.
2. If a member of the Board is dismissed, he shall not be re-nominated for the membership
before three years from the date of issuing the dismissal decision.
Article (169) – Remuneration of the Members of the Board
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1. The Articles of Association shall state the method of calculating the remuneration of the
members of the Board, provided that it shall not exceed (10%) of the net profits of the
ending financial year after deducting all the depreciations and reserves.
2. The penalties imposed on the company due to contraventions by the Board of Directors of
the Law or the Articles of Association of the company during the ending financial year shall
be deducted from the remuneration of the Board of Directors. The General Assembly may
resolve not to deduct such penalties if it finds that such penalties are not due to omission or
error by the Board of Directors.
Article (170) – Invalid Decisions
1. Without prejudice to the rights of bona fide third party, any Decision passed in
contravention of the provisions of this Law, the Memorandum of Association or Articles of
Association of the company or for or against a certain class of shareholders or to bring a
special benefit to the related parties or others without consideration of the interest of the
company shall be invalid.
2. Ruling such invalidation shall make the Decision void ab initio in respect of all the
shareholders.
3. The Board of Directors shall publish the invalidation judgment in two daily local
newspapers, one of them issued in Arabic.
4. The invalidation lawsuit shall be time barred after 60 (sixty) days from the date of issuance
of the contested decision. Filing the lawsuit shall not prevent the execution of the decision,
unless the Competent Court orders otherwise.
Chapter III: General Assemblies of the Public Joint Stock Company
Article (171) – Convening the General Assembly
1. The General Assembly of the shareholders shall be convened under an invitation by the
Board of Directors at least once every year, within four months following the end of the
financial year, at such time and place as determined in the Articles of Association of the
company. The Board may invite the General Assembly to convene as the Board may deem
fit.
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2. If the Board of Directors omits to send an invitation to convene the General Assembly in
such events where this Law requires to be invited, the auditor shall dispatch such invitation.
This shall also apply as necessary. In such event, the auditor shall lay and publish the
agenda.
Article (172) – Notification of the Invitation to the Meeting of the General Assembly
Other than the meeting of the General Assembly adjourned due to absence of quorum in
accordance with the provisions of Article (183) of this Law, invitation shall, subject to the
consent of the Authority, be sent to convene the General Assembly to all the shareholders by a
notice in two daily local newspapers, one of them issued in Arabic, under registered letters or
according to the method of notification as determined by the Authority in this respect, at least
15 (fifteen) days prior to the scheduled date to hold the General Assembly. The notification of
the invitation shall include the agenda. A copy of the papers of the invitation shall be sent to the
Authority and the competent authority.
Article (173) – Valid Notification of the Invitation of the Shareholders
If the invitation to hold the meeting of the General Assembly is notified prior to the date of the
meeting within a period less than the period as determined in Article (172) of this Law, the
invitation to convene the General Assembly shall be valid with the consent of shareholders
representing 95% of the capital of the company.
Article (174) – Request by the Shareholders to invite the General Assembly
1. The Board of Directors of the company shall invite the General Assembly to convene
whenever one or more shareholders hold shares representing at least 20% of the capital,
unless the Articles of Association of the company determines a less percentage, provided
that invitation to hold the General Assembly is addressed within 5 (five) days from the date
of the application. The General Assembly shall be convened within at least 15 (fifteen)
days, but not exceeding 30 (thirty) days from the date of invitation to the meeting.
2. The application as set out in Clause 1 of this Article shall be kept at the head office of the
company and state the purpose of the meeting and the issues to be discussed. The applicant
for the meeting shall provide a certificate from the financial market where the shares of the
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company are listed, confirming the prohibition of disposition of the shares held by the
applicant on his demand until holding the meeting of the General Assembly.
Article (175) – Request by the Auditor to Invite the General Assembly
The Board of Directors shall invite the General Assembly to convene on demand by the
auditor. If the Board fails to send the invitation within 5 (five) days from the date of the
application, the auditor shall send the invitation. The General Assembly shall be convened
within at least 15 (fifteen) days, but not exceeding 30 (thirty) days from the date of invitation to
the meeting.
Article (176) – Request by the Authority to Invite the General Assembly
1. The Authority may demand the Chairman of the company or his representative to address
an invitation to hold the General Assembly in any of the following events:
a) Upon expiry of 30 days from the date as determined in Article (171) of this Law
without inviting the General Assembly to convene;
b) If the number of the Directors is less than the minimum limit required for the quorum of
the meeting;
c) If the Authority finds at any time that there any contravention of Law or the Articles of
Association or that any error in the management of the company has occurred; or
d) If one or more shareholders holding at least 20% of the capital in the event where the
Board of Directors of the company fails to respond in accordance with the provision of
Article (174) of this Law.
2. If the Chairman of the company or his representative fails to invite the General Assembly to
convene in any of the above events within 5 (five) days from the date of demand by the
Authority, the Authority shall give the invitation to the meeting at the expenses of the
company.
Article (177) – Competence of the Annual General Assembly
In particular, the annual General Assembly of the company shall consider the following issues
and take decisions in their regard:
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1) The report prepared by the Board of Directors in respect of the activity and the financial
position of the company during the year, the auditor’s report and the report of the Internal
Shariah Control Committee, if the company conducts its activity in accordance with the
provisions of the Islamic Shariah, and their ratification;
2) The company’s balance sheet and the profits and losses account;
3) Election of the members of the Board if necessary;
4) If the company conducts its activity in accordance with the provisions of the Islamic
Shariah, the appointment of the members of the Internal Shariah Control Committee;
5) Appointment of the auditors and determination of their remuneration;
6) The proposals of the Board of Directors concerning the distribution of profits, whether in
cash or bonus shares;
7) The proposals of the Board of Directors concerning the remuneration of the members and
the determination of such remuneration;
8) Discharge or dismissal of the members of the Board and filing the liability lawsuit against
them, as the case may be; and
9) Discharge or dismissal of the auditors and filing the liability lawsuit against them, as the
case may be.
Article (178) – Right to Attend the General Assembly
1. Every shareholder shall have the right to attend the General Assembly and shall have a
number of votes equal to the number of his shares. Any shareholder that has the right to
attend the General Assembly may delegate any person elected by such shareholder, other
than a member of the Board, under a special written proxy. A proxy of a number of
shareholders shall not hold in this capacity over 5% of the capital of the company.
Shareholders who are minors or interdicted shall be represented by their legal
representatives.
2. A corporate person may delegate one of its representatives or those in charge of its
management under a decision passed by its Board of Directors or any similar entity to
represent such corporate person in any General Assembly of the company. The delegated
person shall have the powers as determined under the delegation decision.
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Article (179) – Control of the Meetings of the General Assembly
1. The Authority and the Competent Authority may send one or more controllers representing
each of them to attend the meetings of the General Assembly of companies without having
any right to vote. The presence of such controllers shall be stated in the minutes of meeting
of the General Assembly.
2. The Central Bank or the Insurance Authority may send one or more controllers to attend the
meetings of the General Assembly of companies licensed by the Central Bank and the
Insurance Authority, without having the right to vote. The presence of such controllers shall
be stated in the minutes of meeting of the General Assembly.
Article (180) – Powers of the General Assembly
1. Subject to the provisions of this Law and the Decisions issued hereunder and the Articles of
Association of the company, the General Assembly shall have the power to consider all the
issues in connection with the company. The General Assembly may not consider other than
the issues listed in the agenda.
2. Notwithstanding the provisions of Clause 1 of this Article, the General Assembly may
consider the serious incidents revealed during the meeting or if the Authority or a number of
shareholders holding at least 10% of the capital of the company demand, before
commencing the discussion of the agenda of the General Assembly, to list certain issues in
the agenda, the Board of Directors shall respond to such request, failing which the General
Assembly shall have the right to resolve to discuss such issues. The Authority may issue a
decision determining the applicable conditions to list a new issue on the agenda of the
General Assembly.
Article (181) – Record of the Meetings of the General Assembly
The shareholders shall enter their names in a special record prepared for such purpose at the
head office of the company prior to the scheduled time to hold the meeting of the General
Assembly. Such record shall include the names of the shareholders, the number of the shares
represented by them and the names of the holders of such shares, and the instrument of proxy
shall be provided. The shareholder shall be given a card to attend the meeting, in which the
number of the votes held by such shareholder in person or by proxy is stated.
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Article (182) – Chairman of the General Assembly
The Chairman or, in his absence, the Deputy Chairman or, if both the Chairman and the Deputy
Chairman are absent, any shareholder so elected by the other shareholders by way of voting by
any means as determined by the General Assembly, shall chair the General Assembly. The
General Assembly shall also appoint a secretary for the meeting. If the General Assembly
considers any issue related to the Chairman of the meeting, whoever he is, the General
Assembly shall elect from the number of the shareholders a Chairman of the meeting during the
discussion of this issue.
Article (183) – Quorum at the Meeting of the General Assembly
Unless the Articles of Association determine a higher percentage, quorum at a meeting of the
General Assembly shall be present if shareholders holding or representing by proxy at least
50% of the capital of the company are present at the meeting. If quorum is not present at the
first meeting, the General Assembly shall be adjourned to another meeting to be held after at
least 5 (five) days, but not exceeding 15 (fifteen) days from the date of the first meeting.
Quorum at the adjourned meeting shall be present irrespective of the number of the present
shareholders.
Article (184) – Withdrawal from the Meeting of the General Assembly
If any of the shareholders or their representatives withdraws from the meeting of the General
Assembly upon the presence of quorum thereat, such withdrawal shall not, irrespective of the
number of the shares withdrawing, affect the validity of the General Assembly, provided that
the decisions shall be passed by the applicable majority in this Law.
Article (185) – Discussion of the Agenda of the General Assembly
1. Every shareholder attending the General Assembly shall be entitled to discuss the matters
listed on the agenda of the General Assembly and to address questions to the members of
the Board and the auditor. The members of the Board and the auditor shall reply to the
questions to the extent that may not cause damage to the interest of the company.
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2. A shareholder may appeal to the General Assembly if the shareholder sees that the reply to
his question is insufficient. The Decision by the General Assembly shall be enforceable.
Every provision in the Articles of Association of the company to the contrary shall be
invalid.
Article (186) – Voting on the Decisions of the General Assembly
1. Subject to the provision of Article (146) of this Law, voting on the General Assembly
Decisions shall be conducted by the method as determined by the Articles of Association of
the company. However, voting shall be secret if related to the election, dismissal or
accountability of the Directors.
2. Subject to the provision of Article (178) of this Law, the members of the Board shall not
participate in voting on the Decisions of the General Assembly for their discharge from
liability for their management or in connection with a special benefit of the members of the
Board, a conflict of interests, or a dispute between them and the company, and in the event
of a corporate person, the share of such corporate person shall be excluded.
Article (187) – Minutes of Meetings of the General Assembly
1. Minutes of the General Assembly shall be issued. The minutes shall include the names of
the shareholders present in person or those represented, the number of the shares held by
them, in person or by proxy, the votes held by them, the Decisions passed, the number of
the votes for or against such Decisions and an adequate summary of the discussions at the
meeting.
2. The minutes of the meeting of the General Assembly shall be regularly entered after each
meeting in a special register, to be kept in accordance with the conditions determined by a
Decision of the Authority. The minutes shall be signed by the Chairman and the secretary of
the meeting, the canvasser and the auditor. The persons who sign the minutes of meetings
shall be responsible for the authenticity of their contents.
Article (188) – Decisions of the General Assembly
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1. The Decisions of the General Assembly shall be passed by the majority of the shares
represented at the meeting, or such higher majority as determined by the Articles of
Association of the company.
2. The Decisions passed by the General Assembly in accordance with the provisions of this
Law and the Articles of Association of the company shall be binding to all the shareholders,
whether they were present or absent from the meeting at which the Decisions have been
passed and whether they agreed or objected to such Decisions.
Article (189) – Execution of the Decisions of the General Assembly
The Chairman of the company shall execute the decisions of the General Assembly and notify a
copy thereof to the Authority and the Financial Market where the shares of the company are
listed and to the competent authority in accordance with such conditions laid by the Authority
in this respect.
Article (190) – Inspection of the Minutes of the General Assembly
1. The minutes of meetings of the General Assembly of the shareholders shall be kept at the
head office of the company. Any shareholder may inspect such minutes free of charge
within the applicable working hours.
2. If the company rejects or fails to comply with the provisions of this Article, the Authority
may issue an order to inspect the contents of the minutes in respect of the discussions of the
General Assemblies. The Authority may issue an order to the company to deliver the
required copies to the person or persons who demand such copies.
Article (191) – Suspension of a Decision by the General Assembly
1. On demand by the shareholders who hold a percentage of at least 5% of the shares of the
company, the Authority may issue a Decision to suspend the execution of the decisions
passed by the General Assembly of the company to the detriment of the shareholders or in
favour of a certain class of the shareholders or to bring a special benefit to the members of
the Board or others whenever the grounds of the request are serious.
2. A request to suspend the execution of the Decisions of the General Assembly shall not be
acceptable upon the expiry of 3 (three) working days from the date of such Decisions.
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3. The concerned parties shall file the lawsuit to annul such Decisions before the Competent
Court and notify the Authority with a copy thereof within 5 (five) days from the date of the
Decision suspending the execution of the Decisions of the General Assembly, otherwise the
suspension shall be void ab initio.
4. The Court shall consider the lawsuit to annul the Decisions of the General Assembly, and
may order, as a matter of urgency, to suspend the execution of the Decision by the
Authority on demand by the adversary until the conclusion of the merits of the lawsuit.
Article (192) – Non-Election of the Board of Directors or Appointment of the Auditor
1. Subject to the provisions of Article (143) of this Law, if the General Assembly of the
company fails to take a Decision in connection with the election of the members of the
Board at two successive meetings although quorum is present, the Authority shall refer the
issue to its Chairman, upon consultation with the Competent Authority and the entities
supervising the activity conducted by the company in the State, to appoint a temporary
Board of Directors of the company for not more than one financial year. At the end of the
financial year, the temporary Board of Directors shall invite the General Assembly of the
company to elect the members of the Board. If such General Assembly fails to elect the
members of the Board, the Authority shall refer the issue to its Chairman, upon consultation
with the competent authority and the entities supervising the activity conducted by the
company in the State, to take the appropriate Decision, including the dissolution of the
company.
2. If the General Assembly of the company fails to take a Decision in connection with the
appointment of its auditor at its annual meeting in accordance with the provisions of
Articles (243) and (244) of this Law despite the presence of quorum, the Authority may
appoint the auditor of the company for one financial year and determine his fees.

Chapter IV: Capital of a Public Joint Stock Company
Article (193) – Issued and Authorized Capital of the Company
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1. The minimum limit of the issued capital of a Public Joint Stock Company is AED thirty
million. This limit may be increased under a Decision by the Cabinet on a suggestion made
by the Chairman of the Authority.
2. The Articles of Association of the company may determine as authorized capital such
amount not exceeding the double of the issued capital, in accordance with such terms and
conditions laid by the Authority in this respect.
Article (194) – Increase of the Company’s Capital
1. The capital of the company may be increased upon payment of its issued capital in full.
2. The authorized capital may be increased with the consent of the Authority under a special
Decision issued by the General Assembly.
3. The Board of Directors may increase the issued capital of the company within the limit of
the authorized capital previously approved by the General Assembly, in accordance with
such terms laid by the Authority in this respect.
4. The Decision to increase the issued capital shall state the amount of such increase and the
price of the new shares issued.
5. If the increase of the capital of the company involves contributions in kind, the provisions
related to valuation of the contributions in kind as contained in this Law.
6. If there is no authorized capital, the decision to increase the issued capital may delegate the
Board of Directors of the company to determine the date to execute the increase Decision,
provided that such date shall not exceed one year from the date of issue thereof, otherwise
the Decision shall be deemed void ab initio.
Article (195) – Methods to Increase the Capital of the Company
The capital of the company may be increased by any of the following ways:
1) Issue of new shares;
2) Capitalize the reserve; or
3) Convert the bonds or Sukuk issued by the company into shares.
Article (196) – Issue Premium
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1. The shares from increase of the capital of the company shall be issued under a nominal
value equal to the nominal value of the original shares. However, the company may under a
special Decision, subject to the consent of the Authority, resolve to add a premium to the
nominal value of the share and determine the amount of such premium. Such premium shall
be added to the legal reserve; even if the reserve exceeds half the capital thereby.
2. The Board of Directors of the Authority shall issue a Decision determining the method of
calculation of the premium.
Article (197) – Pre-emption Right
1. Subject to the provisions of Articles (223), (224), (225), (226) and (283) of this Law, the
shareholders shall have priority to subscribe to the new shares. Any provision to the
contrary in the Articles of Association of the company or the Decision to increase the
capital shall be void.
2. A shareholder may sell the pre-emption right to another shareholder or to third parties with
a material consideration. The Board of Directors of the Authority shall issue the Decision
regulating the conditions and procedures of selling the pre-emption right.
Article (198) – Subscription to New Shares
1. Subscription to new shares shall be governed by the rules of subscription to the original
shares.
2. The Board of Directors shall publish a summary for the pre-emption rights issue accredited
by the Authority in two local daily newspapers, one of them published in Arabic, to notify
the shareholders of their pre-emption right in subscription to the new shares.
Article (199) – Distribution of the New Shares
1. New shares shall be distributed to the shareholders who provide applications for
subscription to shares, according to the number of shares held by them provided that this
does not exceed the requests of each.
2. Subject to Clause 2 of Article (197), the balance shares shall be distributed to the
shareholders who provide applications for subscription to shares in excess of the number of
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shares held by them. Any balance shares thereafter shall be offered for public subscription,
in accordance with such conditions as determined by the Authority.
Article (200) – Capitalization of the Reserve
Under a special Decision, the reserve may be merged in the capital of the company by creating
bonus shares to be distributed to the shareholders pro rata to the shares held by each of them, or
by the increase of the nominal value of the shares pro rata to the percentage of urgent increase
in the capital. The shareholders shall not bear any financial obligation as a result thereof.
Article (201) – Conversion of Deeds or Sukuk to Shares
Bonds or Sukuk shall be converted to shares according to the prospectus and conditions as
approved by the Authority. The approval by the Central Bank shall be obtained in the event of
companies licensed by it.
Article (202) – Decrease of the Capital of the Company
The capital of the company may not be decreased without the consent of the Authority and
issuing a special decision upon hearing the report of the auditor. The capital may be decreased
in either of the following cases:
1) If it exceeds the needs of the company;
2) The company suffers such loss that cannot be compensated by future profits.
Article (203) – Methods to Decrease the Capital of the Company
The capital may be decreased by any of the following methods:
1) To decrease the nominal value of the shares, either by refunding part of its value to the
shareholders or to discharge them from the value of the share or any part thereof;
2) To decrease the value of the shares by the cancellation of part of such value equal to the
loss incurred by the company;
3) To forfeit a number of shares equal to the amount of the capital decided to be decreased; or
4. To purchase a number of shares equal to the part proposed to be decreased and forfeited.
Article (204) – Procedures to Decrease the Capital of the Company
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1. The Board of Directors shall, upon decrease of its capital:
a) Publish an announcement in two daily local newspapers, one of them issued in Arabic,
30 (thirty) days prior to the date scheduled to decrease the capital, provided that the
announcement includes the amount of the capital before and after the decrease, the
value of every share and the effective date of the decrease. The creditors shall provide
to the company such documents in support of their debts within 30 (thirty) days from
the date of publication of the announcement.
b) That the majority of the Board members of the company at least execute an undertaking
on the determined effective date of the decrease, stating that the company is able to pay
its debts on that date, or that all the creditors of the company have agreed to the
decrease.
c) If, upon execution of the undertaking by the majority of the Board members of the
company that the company is capable to repay its debts on that date, any of the creditors
of the company objects to the decrease and it is established that the company is unable
to repay the debts, the members executing the undertaking shall be jointly liable as
between themselves to repay the debt of the objecting creditor, to be calculated on the
basis of the assets, rights and obligations of the company if it were liquidated on the day
preceding the date of execution of the undertaking.
d) Any other requirements as decided by the Authority.
2. If the decrease of the capital is by the repayment of part of the nominal value of the shares
to the shareholders or discharge of the shareholders to the extent unpaid of the value of the
shares or any part thereof, such decrease shall not be effective against the creditors who
provided their demands on the date as set forth in Clause 1-a of this Article, unless such
creditors have received their due debts or obtained the securities adequate for the repayment
of the debts not due by then.
Article (205) – The Decision to Increase or Decrease the Capital of the Company
The Board of Directors of the company shall, within 5 (five) working days from the effective
date of the decision to increase or decrease its capital, enter such decision with the Authority,
the competent authority and the registrar.

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Chapter V: Shares, Bonds and Sukuk
Article (206) – Rights Attached to Shares
1. Unless otherwise provided for in this Law, the shareholders of the company shall be equal
in the rights attached to the shares. The company shall not issue different classes of shares.
2. Notwithstanding the provision of Clause 1 of this Article, the Cabinet may, on proposal by
the Chairman of the Authority, issue a Decision determining other classes of shares and the
conditions of issuing the shares, the rights and obligations arising from such shares and the
rules and procedures regulating them.
3. A shareholder may not demand to recover its contribution to the capital of the company.
Article (207) – Nominal Value of the Shares
1. The nominal value of the share in a company may not be less than one Dirham, and shall
not exceed one hundred (100) Dirhams.
2. Shares may be issued by payment of at least one quarter of their nominal value, provided
that the balance value of such shares shall be paid within no later than 3 (three) years from
the date of registration of the company with the competent authority.
3. The company may, under a special Decision and with the consent of the Authority, divide
the nominal value of its shares into a smaller value, provided that the new value shall be at
least one Dirham per share.
Article (208) – Nature of the Shares and Dividends
The shares shall be nominal. No shares to bearer shall be issued. The shares shall be negotiable.
The Articles of Association of the company shall determine the form and provisions of
dividends, which may be nominal or to bearer. At all events, dividends shall be negotiable. Any
condition restricting free negotiation of such dividends shall be void ab intio.
Article (209) – Disposal of the Shares
The method and conditions of disposal of shares shall be determined in accordance with the
provisions of this Law, the Regulations and Decisions issued by the Authority and the Articles
of Association of the company, provided that the disposal of the shares shall not lead to the
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decrease of the share of the UAE nationals in the capital of the company below the applicable
limit according to this Law.
Article (210) – Mortgage of the Shares
Shares may be mortgaged by the delivery thereof to the creditor or its representative upon
following the applicable procedures in this respect. A mortgagee creditor shall collect the
profits and use the rights attached to the share, unless agreed otherwise in the mortgage
contract.
Article (211) – Transfer of Title to the Shares Listed in the Markets
Title to the shares of the company listed in any of the financial markets licensed in the State
shall be transferred in accordance with the applicable procedures of the Authority and the
Financial Market where such shares are listed.
Article (212) – Transfer of the Title to Shares Not Listed in the Markets
1. The title of the shares not listed in the markets shall be transferred by the entry of such
transfer in a register held by the company. Such entry shall be marked on the share and the
transfer shall be effective against the company or third parties only from the date of such
entry.
2. However, the company may not enter the disposal of the shares in the following events:
a) If such disposal is in violation of the provisions of this Law or the Decisions issued in
execution hereof or the Articles of Association of the company;
b) If the shares are mortgaged or attached by an order of the Court;
c) If the certificate of shares is lost and the company did not issue a substitute thereof;
d) If the company holds a debt on the shares, the company may suspend the registration of
the transfer of the shares, unless its debt is repaid; and
e) If any of the contracting parties lacks capacity, is incapacitated or declares its
bankruptcy or insolvency.
Article (213) – Transfer of Title to Shares by Inheritance, Will or Court Judgment
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1. If title to a share is transferred by way of inheritance or will, the heir or legatee shall
demand to enter the transfer of title in the register of shares.
2. If the transfer of title is under an applicable court judgment, such transfer shall be entered in
the share register in accordance with this judgment. The transferee shall use the rights
derived from such transfer from the date of such registration.
Article (214) – No Division of the Share
A share shall be indivisible. If title to a share is vested in several heirs or a share is held by
several persons, they shall choose one of their number as their representative against the
company. Such persons shall be jointly liable for the obligations arising from the title to the
share. If such holders fail to agree on the choice of their representative, any of them may resort
to the competent Court to appoint such representative.
Article (215) – Limitations to Trading in the Shares of the Founders
1. The shares in cash or in kind of the founders may not be traded prior to the publication of
the balance sheet and the profit and loss account for at least two financial years
commencing from the date of listing the company in the Financial Market in the State or
from the date of registration of the company in the Commercial Register with the competent
authority in the event of companies excluded from listing. Such shares shall be marked as
founders’ shares. The provisions of this Article shall apply to the subscriptions by the
founders in the event of increase of the capital prior to the expiry of the prohibition period.
2. During the prohibition period, such shares may be mortgaged or transferred by sale by a
founder to another founder or by the heirs of a founder in the event of his death to third
parties or by the bankruptcy trustee of a founder to third parties or under a final judgment.
3. The Board of Directors of the Authority may issue a Decision to expand the period of
prohibition as set forth in Clause 1 of this Article, without exceeding three years.
Article (216) – Attachment of Shares
The funds of the company may not be attached due to debts payable by a shareholder.
However, the creditors of the shareholder may attach its shares and the profits derived from
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them. A share shall be marked in the share register and in the Financial Market where the
shares of the company are listed.
Article (217) – Non Payment by a Shareholder of the Balance Value of the Share
1. If a shareholder in a Joint Stock Company fails to pay the installment of the share value on
the maturity date, the Board of Directors may notify the shareholder to pay the outstanding
installment under a registered letter. If the shareholder fails to make payment within 30
days, the company may sell the share at a public auction or according to the Decisions
issued by the Authority.
2. The company shall apply the sale proceeds to settle any overdue installments and expenses
as compensation for the delay and shall pay the balance amount to the holder of the share.
The company shall have the right of recourse against the shareholder from his own funds if
the sale proceeds cannot settle the rights of the company, and the shares shall be entered in
the share register in the name of the purchaser.
Article (218) – Discharge of Shareholders
1. The company may not discharge a shareholder from his obligation to pay the value of a
share. Such obligation may not be set off against any rights of the shareholder from the
company.
2. Any of the creditors of the company may file a lawsuit against the shareholder to demand
him to pay the value of the share.
Article (219) – Company Share Buyback
1. The company may not mortgage its own shares or purchase such shares unless the purchase
is intended to decrease the capital or for the redemption of the shares. In such event, such
shares shall have no vote in the deliberations of the General Assembly or a share of the
profits.
2. Notwithstanding the provision of Clause 1 of this Article, the company that has been
incorporated as a Public Joint Stock Company for at least two financial years may purchase
a percentage of its shares not exceeding 10% of the shares representing its capital for the
purpose of resale thereof in accordance with the terms and conditions as resolved by the
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Board of Directors of the Authority. The shares purchased for the purpose of resale thereof
shall have no vote in the deliberations of the General Assembly or a share of the profits
until the resale of such shares.
Article (220) – Omitting the Entry of Particulars in the Shares Register
If the name of any person or the number of the shares held by such person is omitted to be
entered in the register of the shareholders of the company, or in the event of any unjustified
failure or delay to enter the incident that any person is not a shareholder, the affected person or
any shareholder of the company may demand the company to amend the particulars of the
register, and the company may reject the request for amendment. In such event, the affected
person may resort to the Court.
Article (221) – Shareholder Rights
1. A shareholder in a Joint Stock Company shall have:
a) All the rights attached to the share, particularly the right to obtain its share of the profits
and assets of the company upon its liquidation, to attend the meetings of the General
Assembly and voting on its Decisions, all in accordance with such terms and conditions
as provided by this Law and the Articles of Association of the company.
b) The right to inspect the books and documents of the company and any documents or
instruments in connection with a deal made by the company by entering into the deal
with a related party by authorization from the Board of Directors or under a decision of
the General Assembly or as provided by the Articles of Association of the company in
this respect.
2. The Court may demand the company to provide specific information to the shareholder not
in conflict with the interests of the company.
3. Any Decision issued by the Board of Directors or the General Assembly of the company
that may prejudice the rights of the shareholder derived from the provisions of this Law or
the Articles of Association of the company or requires to increase the obligations of such
shareholder shall be invalid.
Article (222) – Financial Aid to the Shareholder
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The company or any of its subsidiaries may not provide financial aid to any shareholder to
enable the shareholder to hold any shares, bonds or Sukuk issued by the company. In particular,
financial aid shall include:
1) To provide loans;
2) To provide gifts or donations;
3) To provide the assets of the company as security; and
4) To provide a security or guarantee of the obligations of another person.
Article (223) – Contribution by the Strategic Partner
1. Notwithstanding the provisions of Articles (195), (197), (198) and (199) of this Law, the
company may under a special Decision increase its capital by the entry of a strategic
partner. The Board of Directors of the Authority shall issue a Decision determining the
conditions and procedures of entry of the strategic partner as a shareholder of the company.
2. The Board of Directors of the company shall present to the General Assembly a study
showing the benefits to be achieved by the company from the entry of the strategic partner
as a shareholder in the company.
3. The Authority and the competent authority may reject the contribution by the strategic
partner in the company if such contribution may contravene the applicable Laws or
Regulations of the State or adversely affect the public interest.
Article (224) – Conditions of Contribution by the Strategic Partner
1. The Board of Directors of the company may, within three months from the date of the
Decision to increase the capital of the company to enter a strategic partner as a shareholder
of the company, offer all or any of the new shares for subscription by the strategic partner
without offering such shares to the shareholders, under the following conditions:
a) That the activity of the strategic partner is similar or supplementary to the activity of the
company and leads to a real benefit thereof; and
b) That the strategic partner has issued two balance sheets for at least two financial years.
This shall not apply to the Federal Government or the Local Government in the State.
2. If the Board of Directors fails to offer the new shares to the strategic partner within the
three-month period as set forth in Clause 1 of this Article or if the strategic partner fails to
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subscribe to such shares within a period of no later than 30 (thirty) days from the date of
offering the shares to such partner, the decision by the General Assembly to increase the
capital of the company to join a strategic partner shall be deemed void ab initio.
Article (225) – Capitalization of Cash Debts
1. Notwithstanding the provisions of Articles (195), (197), (198) and (199) of this Law, the
company may under a special Decision increase its capital by the capitalization of its cash
debts.
2. The Board of Directors of the company shall present to the General Assembly a study
showing the necessity to capitalize the cash debts.
3. It shall be deemed as cash debts in accordance with the provisions of this Law, the debts
payable to the Federal Government, the Local Governments and the public authorities and
establishments in the State, the banks and the financing companies.
4. The Board of Directors of the Authority shall issue a Decision determining the conditions
and procedures to capitalize the cash debts.
Article (226) – Encouraging the Personnel of the Company to hold Shares
1. Notwithstanding the provisions of Articles (195), (197), (198) and (199) of this Law, the
company may under a special Decision increase its capital by the application of the scheme
to encourage the personnel of the company to hold shares.
2. The Board of Directors of the company shall present to the General Assembly a scheme to
encourage the personnel of the company to hold shares.
3. The Board members of the company may not participate in the scheme to encourage the
personnel of the company to hold shares.
4. The Board of Directors of the Authority may issue a Decision including the conditions and
mechanism to implement a scheme to encourage the personnel of the company to hold
shares.
Article (227) – Share Certificates
1. Unless, after its incorporation, the company has listed its shares in any of the financial
markets in the State, the Board of Directors shall, within three months from the date of
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registration of the company in the Commercial Register with the competent authority,
substitute the notices to allocate the shares by share certificates.
2. Share certificates shall be signed by at least two members of the Board, stating the name of
the shareholder, the number of the shares subscribed thereto, the method of payment of their
value, the part paid of such value, the date of payment, the serial number of the certificate,
the numbers of the shares held by the shareholder, the issued and authorized capital of the
company, the head office and the term of the company and the date of the Decision
authorizing the incorporation of the company. Such certificates shall substitute the shares.
3. If the value of the share is installed, the obligation of the company to deliver the share
certificate shall be adjourned until the payment of the value of the shares in full. The shares
representing contributions in kind may not be delivered until the transfer of title to such
contributions in kind to the company.
Article (228) – Loss or Destruction of Shares, Bonds or Sukuk Certificates
1. If a share, bond or Sukuk certificate is lost or destroyed, the holder of the certificate in
whose name the certificate is registered may demand a new certificate instead of the lost or
destroyed certificate. The owner shall publish the numbers of the lost or destroyed
certificates and their quantity in two daily local newspapers, one of them issued in Arabic.
2. If no objection is received by the company within thirty days from the date of publication,
the company shall give to the holder of the former certificate a new certificate, stating that it
is in lieu of the lost or destroyed certificate. Such new certificate shall entitle its holder all
the rights and impose on him all the obligations connected with the lost or destroyed
certificate.
Article (229) – Issuing Bonds or Sukuk
1. The company may issue negotiable bonds or Sukuk, whether they can be converted into
shares of the company for equivalent values per each issuance.
2. The bond or deed shall remain nominal until the payment of its value in full.
3. Bonds or Sukuk shall not be converted into shares, unless the prospectus so provides. If
conversion is decided, the holder of the bond or Sukuk alone shall have the right to accept
the conversion or to collect the nominal value of the bond or Sukuk.
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4. Bonds or Sukuk issued in connection with a single loan, giving equal rights to the holders of
such bonds or deeds. Any condition to the contrary shall be invalid.
5. Bonds, Sukuk and other debt instruments shall be issued in accordance with such conditions
and procedures determined under a regulation issued by the Central Bank and the Authority.
Article (230) – Conditions to Issue Bonds or Sukuk
Subject to the provision of Clause 5 of Article (229) of this Law, bonds or Sukuk shall be
issued only upon:
1) Issuing a special Decision by the General Assembly. The General Assembly may authorize
the Board of Directors to determine a date to issue bonds or Sukuk, provided that such date
shall not exceed one year from the date of approval of the authorization.
2) Collection of the capital in full from the shareholders and the publication of the balance
sheet and the profits and losses account for at least one financial year, unless the issue is
secured by the State or a bank operating in the State.
Article (231) – Increase or Decrease of the Capital after issuing Bonds or Sukuk
Upon issuing a special Decision to issue bonds or Sukuk convertible to shares and until the date
of such conversion or payment of their value, the company may not decrease its capital or
increase the rate decided to be distributed as a minimum limit of profits to the shareholders. In
the event of decrease of the capital of the company due to the losses by way or forfeiture of a
number of shares or the decrease of the nominal value of the share, the capital shall be
decreased, as if the holders of the bonds were shareholders.
Article (232) – Profits of the Bonds or Sukuk upon their Conversion into Shares
Shares received by the holders bonds or Sukuk converted into shares in the capital of the
company shall have a share of the profits resolved to be distributed for the financial year during
which the conversion is made, from the date of such conversion until the end of the financial
year.
Article (233) – Date of Payment of Bonds or Sukuk
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The company may not advance or delay the date of payment of bonds or Sukuk unless
otherwise provided by the Decision issuing the bonds or Sukuk and the prospectus. However, if
the company is dissolved other than for merger, the holders of bonds or Sukuk may demand to
pay the value of their bonds or Sukuk prior to their maturity date. The company may also offer
such payment to them. In either event, if payment is made, interests shall not be payable for the
balance period of the loan.
Article (234) – Rights of the Holders of Bonds or Sukuk
The rights of the holders of bonds or Sukuk issued by the company, which are not offered for
public subscription in the agreement creating such bonds or Sukuk shall be determined. Such
agreement shall also include procedures needed from the holders of bonds or Sukuk to hold
meetings and appointing any committees, voting rights and all the other related issues and the
conditions of converting them to shares in the company if they were convertible .The Authority
may issue a Decision regulating the rights of the holders of bonds or Sukuk.

Chapter VI: Finance of the Public Joint Stock Company
Article (235) – Preparing the Accounts of the Financial Year
1. The Board of Directors in each Joint Stock Company shall prepare accounts of every
financial year including the balance sheet as per the last day of the financial year and a
statement of the profits and losses account.
2. The accounts of the company shall be prepared in accordance with the International
Accounting Practices and Standards. Such accounts shall give a true and fair view of the
profits or losses of the company for the financial year and the affairs of the company at the
end of the financial year and shall comply with any other requirements in this Law and the
relevant Decisions issued by the Authority.
3. The financial statements shall be approved by the execution thereof by the members of the
Board or by the Chairman and the auditor.
Article (236) – Auditing the Accounts of the Financial Year
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1. The accounts of the financial year of the company shall be reviewed by the auditor, who
shall prepare a report thereon. Such accounts shall be approved by the Board of Directors
and presented to the General Assembly together with the auditor’s report, within 4 (four)
months from the end of the financial year of the company.
2. The company shall provide the Authority and the competent authority a copy of the
accounts and the auditor’s report within seven days from the date of convening the General
Assembly that the accounts and the auditor’s report have been provided thereto.
Article (237) – Accounting Practices and Standards
The International Accounting Practices and Standards shall be applied by the companies upon
preparing their periodical and annual accounts and determining the dividends.
Article (238) – Publication of the Balance Sheet of the Company
The balance sheet and the profits and losses account shall be published in two daily local
newspapers, one of them issued in Arabic, within 15 (fifteen) days from the date of approval
thereof by the General Assembly. A copy of the balance sheet and the profit and loss account
shall be provided to the Authority and the competent authority.
Article (239) – Legal Reserve
1. 10% of the net profits of the company shall be set aside every year and allocated to create a
legal reserve, unless the Articles of Association of the company provide for a higher
percentage.
2. The General Assembly may suspend such deduction whenever the legal reserve reaches
50% of the paid capital of the company, unless the Articles of Association of the company
provide for a higher percentage.
3. The legal reserve may not be distributed to the shareholders. However, the legal reserve in
excess of 50% of the capital may be distributed as profits to the shareholders in accordance
with the percentage determined in the Article of Association in the years in which the
company does not make sufficient net profits to distribute such rate.
Article (240) – Voluntary Reserve
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The Articles of Association of any Joint Stock Company may provide for the allocation of a
certain percentage of the net profits to create a voluntary reserve to be allocated for the
purposes as provided by the Articles of Association. The voluntary reserve may not be used for
other purposes except under a Decision by the General Assembly of the company.
Article (241) – Distribution of Profits
1. The General Assembly of the company shall determine such percentage of the net profits to
be distributed to the shareholders after deducting the legal reserve and the optional reserve.
2. A shareholder shall be entitled to his share of the profits in accordance with the conditions
as determined under a Decision by the Authority.
3. Subject to Clause 1 of this Article, the Articles of Association of the company may provide
for the distribution of annual, biannual or quarterly profits.
Article (242) – Joint Liability of the Companies
Upon the expiry of two financial years from the date of its incorporation and making profits,
the company may, under a special Decision, give contributions. Such contributions may not
exceed 2% of the average net profits of the company during two financial years preceding the
year of contribution, provided that:
1) Such contributions shall be used for the purposes of serving the society;
2) To clearly state the beneficiary from such contributions in the auditor’s report and the
balance sheet of the company.

Chapter VII: Auditors of Public Joint Stock Companies
Article (243) – Appointment of the Company’s Auditor
1. Every Public Joint Stock Company shall have one or more auditors nominated by the Board
of Directors and approved by the General Assembly.
2. The General Assembly may appoint one or more auditors for one renewable year, provided
that such term shall not exceed three successive years, so that the auditor shall undertake his
duties until the end of the next annual General Assembly. The Board of Directors of the
company may not be authorized for such purpose. The founders of the company may, at the
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time of incorporation, appoint one or more auditors as approved by the Authority to perform
its duties until the convention of the first General Assembly.
3. The General Assembly shall determine the fees of the auditor. The Board of Directors may
not be delegated to this effect, provided that such fees are reflected in the accounts of the
company.
Article (244) – Conditions of the Company’s Auditor
The Board of Directors of the Authority shall issue a Decision of the conditions to approve the
auditors of Public Joint Stock Companies. In particular, the auditor shall meet the following
conditions:
1) To be licensed to practice the profession in the State and to have experience in auditing
Joint Stock Companies for at least five years;
2) His name shall be approved by the Authority;
3) Not to combine between the profession of auditor and the capacity of a shareholder in the
company, and to occupy the office of member of the Board or any technical, administrative
or executive office therein;
4) Not to be a partner or agent of any of the founders of the company or any of its Board
members or a relative of any of them up to the second grade.
5) That the name of the auditor is approved by the Central Bank in case of companies licensed
by the latter. f. The Authority may require providing a professional insurance by the auditor.
Article (245) – Audit Report
1. Subject to the provisions of the Federal Law regulating the profession of auditors, as
amended, the auditor shall issue a report on the accounts audited by him. If the company
has more than one auditor, they shall distribute the duties among themselves and each of
them shall provide a separate report on the issues of the task assigned to such auditor, and
then all the auditors shall prepare a common report for which they shall be jointly liable.
The auditor shall state his name on the report and sign it.
2. The report shall state whether the accounts have been prepared in accordance with the
provisions of this Law and whether the accounts give a fair view of the financial position of
the company.
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Article (246) – Duties of the Company’s Auditor
1. The auditor shall audit the accounts of the company, inspect the balance sheet and the
profits and losses account, review the transactions of the company with the related parties
and ensure the application of the provisions of this Law and the Articles of Association of
the company. The auditor shall provide a report as a result of such inspection to the General
Assembly and dispatch a copy of the report to the Authority and the competent authority.
2. Upon preparing his report, the auditor shall confirm the following:
a) The extent of validity of the accounting records kept by the company.
b) The extent of agreement between the records of the company and the accounting
records.
3. The auditor shall review all the records, papers and other documents of the company. The
auditor may require such explanations as the auditor may deem necessary to perform his
duties. The auditor may also verify the assets, rights and obligations of the company.
4. If no facilities are provided to the auditor to perform his duties, the auditor shall state this in
his report to the Board of Directors. If the Board of Directors fails to facilitate the task of
the auditor, the Board of Directors shall send a copy of the report to the Authority.
5. The subsidiary and its auditor shall provide such information and explanations as demanded
by the auditor of the holding company for the purposes of audit.
Article (247) – Confidentiality of the Particulars of the Company
The auditor shall keep the confidentiality of the particulars of the company inspected by him by
way of performing the duties of his job with the company. The auditor may not disclose such
particulars to third parties or to the shareholders other than during the General Assembly,
failing which the auditor shall be dismissed, without prejudice to the civil and penal liability, as
applicable.
Article (248) – Prohibition of Trading in Securities by the Auditor
The auditor and his personnel may not purchase the securities of the company whose accounts
are audited by him or sell such securities directly or indirectly or provide any consultancies to
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any person in connection with such securities, failing which the auditor shall be dismissed,
without prejudice to the civil and penal liability, as applicable.
Article (249) – Notification of Crimes and Contraventions
1. The auditor shall notify the Authority in connection with any violations of the provisions of
this Law or any contraventions that constitute a crime detected upon performance of his
duties at the company, within 10 (ten) days from the date of detecting the contravention.
2. If the auditor contravenes the provision of Clause 1 of this Article, the Authority may
suspend the auditor from auditing the accounts of Public Joint Stock Companies for no later
than one year, strike out the approval of the Authority or refer the auditor to the Public
Prosecution, as applicable, and at all events, to notify the Ministry and the competent
authority in this respect.
Article (250) – Contents of the Auditor’s Report
The auditor shall read his report at the General Assembly of the company when the balance
sheet of the company is considered, provided that his report shall state whether the auditor has
inspected the information that he deems necessary for the satisfactory performance of his duties
and prepared the accounts in accordance with the provisions of this Law, and that such
accounts reflect, in particular, the following issues:
1) The position of the company at the end of the financial year, particularly the balance sheet
of the company;
2) The profits and losses account;
3) That the company keeps regular accounts;
4) A statement whether the company has purchased any shares or stocks during the financial
year;
5) That the statements in the Board report are identical to the books and records of the
company;
6) A statement of the deals of conflicts of interest and the financial transactions made between
the company and any of the related parties and the procedures taken in that respect;
7) To state whether, within the limit of the information made available to the auditor, any
contraventions of the provisions of this Law or the Articles of Association of the company
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have occurred during the financial year so as to adversely affect the activity or financial
position of the company, whether such contraventions still exist or not and whether there
are any penalties imposed on the company due to such contraventions;
8) To state whether there are penalties imposed on the company due to contraventions of this
Law or the Articles of Association of the company during the ending financial year and
whether such contraventions still exist; and
9) In the events of accounts of any group, to state the financial position at the end of the
financial year and the profits and losses account of the holding company and its
subsidiaries, including the consolidated statements as a whole, in connection with the
relevant parties in the holding company.
Article (251) – Dismissal of the Company’s Auditor
1. The company may, under a Decision taken by its General Assembly, dismiss the auditor.
2. The Chairman shall notify the Authority of the Decision dismissing the auditor and the
reasons of such dismissal, within a period not exceeding 7 (seven) days from the date of the
dismissal decision.
Article (252) – Resignation of the Company’s Auditor
1. The auditor may resign from his task under a written notice given to the company and the
Authority. Such notice shall be deemed as termination of his task as an auditor of the
company from the date of giving the notice or on any later date as determined in the notice.
2. The auditor that resigns for any reason shall file with the company and the Authority a
statement of the reasons for his resignation. The Board of Directors of the company shall
invite the General Assembly to convene within 10 (ten) days from the date of filing for
resignation to consider the reasons for resignation and to appoint another auditor and to
determine the fees of such substitute auditor.
Article (253) – Liability of the Company’s Auditor
The auditor shall be liable to the company for the audits and the validity of the statements in his
report and to indemnify the damage incurred by the company due to his acts upon performing
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his job. If there is more than one auditor, each of them shall be liable for his own fault that
caused the damage.
Article (254) – Liability Lawsuit against the Company’s Auditor
The liability lawsuit against the auditor of the company shall be time barred upon the expiry of
one year from the date of holding the General Assembly at which the auditor’s report is read. If
the act attributed to the auditor constitutes a crime, the liability lawsuit shall not be time barred
until the public lawsuit is time barred.
TITLE V. PRIVATE JOINT STOCK COMPANIES
Article (255) – Definition of the Private Joint Stock Company
1. A Private Joint Stock Company is a company where the number of the shareholders is at
least two shareholders, but not exceeding two hundred shareholders. The capital of the
company shall be divided into shares of the same nominal value, to be paid in full without
offering any shares for public subscription, by the execution of the Memorandum of
Association and compliance with the provisions of this Law in connection with registration
and incorporation. A shareholder shall be liable only to the extent of his share in the capital
of the company.
2. It shall be excluded from the maximum limit of the number of shareholders as set forth in
Clause 1 of this Article:
a) Private Joint Stock Companies existing at the time of issue of this Law. Such
companies may not increase the number of their shareholders after the enforcement of
the provisions of this Law; and
b) The transfer of title of a shareholder by inheritance or a final Court judgment.
3. Notwithstanding the minimum limit of the number of shareholders as set forth in Clause 1
of this Article, a single legal person may incorporate and hold a Private Joint Stock
Company. The holder of the company’s capital shall only be liable for its obligations to the
extent of the capital as set out in its Memorandum of Association. The name of the
company shall be followed by the expression “Sole Proprietorship – Private Joint Stock”.
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The provisions of the Private Joint Stock Company as set forth in this Law shall apply to
such owner to the extent not in conflict with the nature of such company.
Article (256) – Company’s Capital
1. The issued capital of the company shall not be less than AED 5,000,000 (AED five million)
and shall be paid in full. Such limit may be amended under a Decision by the Cabinet on a
proposal made by the Minister.
2. Private Joint Stock Companies existing and registered with the Ministry prior to the
effective date of this Law shall be excluded from the minimum limit of capital as set forth
in Clause 1 of this Article.
Article (257) – Founders Committee
1. The founders shall choose from among them a committee consisting of at least two
members to complete the incorporation procedures and to register the company with the
relevant authorities. The Founders Committee shall be fully liable for the accuracy, validity
and completion of all the documents, studies and reports provided to the relevant authorities
in connection with the incorporation, licensing and registration process of the company. In
the event of a sole proprietorship, the founder shall act as the committee.
2. The Founders Committee may delegate one of its members or a third party to follow and
complete the incorporation procedures with the Ministry and the Competent Authority
according to such conditions laid by the Authority in this respect.
Article (258) – Application for Incorporation provided to the Competent Authority
1. The Founders Committee shall provide the application for incorporation to the Competent
Authority, together with the Memorandum of Association and Articles of Association of the
company, the economic feasibility of the project to be established by the company and the
proposed timetable to perform such project.
2. The Competent Authority shall consider the application for incorporation and issue its
initial approval of the application or reject it and shall notify the Founders Committee
within 10 (ten) working days from the date of submittal of the application if the application
is satisfactory or from the date of completion of the required documents or statements. The
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omission by the Competent Authority to issue its initial approval during such period shall
be deemed as rejection of the application for incorporation.
3. The Founders Committee may appeal, before the Competent Court, the Decision in
rejection issued by the Competent Authority within 30 (thirty) days from the date of its
notification of the Decision of rejection or from the expiry date of the period as set out in
Clause 2 of this Article if no such Decision is issued.
Article (259) – Application for Incorporation provided to the Ministry
1. The Founders Committee shall provide to the Ministry the application for incorporation as
initially approved by the Competent Authority, together with the Memorandum of
Association and Articles of Association of the company, the economic feasibility of the
project to be established by the company, the proposed timetable to perform such project,
and any approvals by the relevant authorities in connection with the application, according
to the applicable requirements of the Ministry.
2. The Ministry shall consider the application for incorporation and notify the Founders
Committee of its notes on the application for incorporation and its documents within 10
(ten) working days from the date of submitting the application or from the date of submittal
of the assessment of the contributions in kind, if any. The Founders Committee shall
complete any deficiency or make such amendments as the Ministry may deem necessary to
complete the application for incorporation, within 10 (ten) working days from the date of
the notice, failing which the Ministry may consider this as a waiver of the application for
incorporation.
3. The Ministry shall dispatch a copy of the application and its documents to the Competent
Authority within 5 (five) working days from the date of completing the application to be
considered. Then, the Ministry shall meet with the Competent Authority within 5 (five)
working days from the date of sending a copy the application to the Ministry. If the
Competent Authority has any notes thereon, the Ministry shall notify the Founders
Committee thereof and complete the deficiency or make such amendments as the
Competent Authority may require to complete the application for incorporation within 5
(five) working days from the date of notifying the Founders Committee, failing which the
Ministry may consider this as a waiver of the application for incorporation.
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4. The competent authority shall issue a decision to grant the license after the consent of the
Ministry.
Article (260) – Secretariat of the Shares Register
1. Private Joint Stock Companies shall have a register where the names of the shareholders,
the number of shares held by them and any dispositions of the shares are entered. Such
register shall be delivered to the shares register secretariat.
2. The Authority shall, in coordination with the Ministry, issue a decision to regulate,
supervise and control the work of the share register secretariat.
Article (261) – Incorporation Certificate
1. The Founders Committee or its representative shall apply to the Ministry to issue the
incorporation certificate of the company. The application shall be accompanied with:
a) A bank certificate confirming that the issued capital of the company has been
deposited;
b) The attested Memorandum of Association and Articles of Association of the company;
c) A copy of the Decision by the competent authority as initial licensing approval;
d) A statement of the names of the Board members of the company and written
acknowledgement by them that their membership is not in conflict with the provisions
of this Law and the decisions issued hereunder;
e) A statement of the names of the members of the Internal Shariah Control Committee
and the Shariah Controller if the company conducts its business in accordance with the
provisions of the Islamic Shariah;
f) A certificate confirming that the register of shareholders has been delivered to the
shares register secretariat; and
g) Any other documents as required by the Ministry.
2. In the event of completion of the documents as set forth in Clause 1 of this Article, the
Ministry shall issue a certificate of incorporation of the company within 2 (two) working
days from the date of submitting a complete application.
3. The registration of the company with the Ministry shall be published in accordance with
such conditions laid by the Minister in this respect at the expense of the company.
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Article (262) – Commercial License of the Company
1. The Board of Directors of the company shall within 5 (five) working days from the date of
issue by the Ministry of the incorporation certificate make its registration procedures before
the Competent Authority.
2. The Competent Authority shall enter the company in the Commercial Register and issue a
commercial license for the company within 3 (three) working days from the date of
completion of the documents and payment of the fees.
Article (263) – Shares Transfer
1. The title of the shares shall be transferred by the entry of such disposal with the shares
register secretariat. Such disposal shall be effective against the company or third parties
only from the date of such entry with the shares register secretariat.
2. A private joint stock company shall not enter any waiver of its shares other than with the
shares register secretariat.
3. The shares register secretariat may reject to enter the waiver of shares in any of the events
as provided by Clause 2 of Article (212) of this Law.
Article (264) – Limitations to the Transfer of Shares
1. The shares of a private joint stock company may not be transferred prior to the publication
of the balance sheet and the profits and losses account for at least one financial year
commencing from the date of registration of the company in the Commercial Register with
the competent authority. The provisions of this Article shall apply in the event of increase
of the capital prior to the expiry of the prohibition period.
2. During the prohibition period, such shares may be mortgaged or transferred by sale by a
shareholder to another shareholder, or by the heirs of a shareholder in the event of his death
to third parties or by the bankruptcy trustee of a shareholder to third parties or under a final
judgment.
3. The Minister may issue a Decision to expand or shorten the period of prohibition as set
forth in Clause 1 of this Article, to be not less than six months and not exceeding two years.
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Article (265) – Application of the Provisions concerning Public Joint Stock Companies
Other than the provisions of public subscription, unless specifically provided, all the provisions
of this Law concerning public Joint Stock Companies shall apply to the Private Joint Stock
Companies, and the term “Ministry” shall replace the term “Authority” wherever it may appear
therein.
TITLE VI. COMPANIES WITH SPECIAL STRUCTURE
Chapter I: Holding Companies
Article (266) – Definition of the Holding Company
1. A holding company is a Joint Stock Company or a Limited Liability Company that
establishes subsidiaries inside the State or abroad or has control on existing companies, by
holding shares or stocks enabling such company to control the management of the
subsidiary and to have influence on the Decisions of the subsidiary.
2. The name of the company followed by the expression “Holding Company” shall appear on
all the papers, advertisements and other documents issued by the Holding Company.
Article (267) – Objectives of the Holding Company
1. The objectives of a Holding Company shall be limited to the following:
a) To hold shares or stocks in Joint Stock Companies and Limited Liability Companies;
b) To provide loans, guarantees and finance to its subsidiaries;
c) To acquire the movables and real estates required to commence its activity;
d) To manage its subsidiaries; and
e) To acquire industrial property rights from patents on invention, trademarks, industrial
marks, royalties and other rights in kind and to lease the same to its subsidiaries or to
other companies.
2. Holding Companies may not conduct their activities other than through their subsidiaries.
Article (268) – Accounts Records to be kept by Subsidiaries
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A Holding Company shall take the required procedures to ensure that the subsidiaries keep the
required accounting records to enable the Board members or the Board of Directors of the
Holding Company to confirm that the financial statements and the profits and losses account
are compliant with the provisions of this Law.
Article (269) – Subsidiaries
1. A company shall be considered as a subsidiary of a Holding Company in any of the
following events:
a) If the Holding Company holds dominating and controlling shares in the capital of the
company and controls the formation of its Board of Directors; or
b) If the company is a subsidiary of a subsidiary.
2. A subsidiary shall not be a shareholder of its own Holding Company. Any allocation or
transfer of any shares in a Holding Company to any of its subsidiaries shall be invalid.
3. If a company that holds shares or stocks in a Holding Company becomes a subsidiary of
such Holding Company, such company shall continue to be a shareholder in the Holding
Company, provided that:
a) The subsidiary shall be deprived from the right to vote at the meetings of the Board of
Directors of the Holding Company or the meetings of its General Assembly; and
b) The subsidiary shall dispose of its shares in the Holding Company within 12 (twelve)
months from the date of acquisition of the subsidiary by the Holding Company.
Article (270) – Financial Year of the Holding Company
The Holding Company shall, at the end of every financial year, prepare a consolidated balance
sheet, the profits and losses account and the cash flows of the Holding Company and all its
subsidiaries and shall present them to the General Assembly, together with the relevant notes
and statements, in accordance with the internationally accepted accounting and audit practices
and standards.
Chapter II: Investment Funds
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Article (271) – Formation of Investment Funds
1. Investment funds shall be established according to the conditions and controls stated in a
decision issued by the Authority in this regard.
2. The licenses of investment funds issued by the Central Bank before the entry into effect of
this Law shall be excluded from Clause 1 of this Article.
Article (272) – Legal Personality of the Fund
The investment fund shall have an independent legal personality, legal entity and
financial liability.

TITLE VII. CONVERSION, MERGER AND APPROPRIATION OF COMPANIES
Chapter I: Conversion of Companies
Article (273) – Rules of Conversion
Any company may be converted from one form into another, while keeping its legal
personality, in accordance with the provisions of this Law and the Regulations and Decisions
regulating the conversion of companies as issued by the Ministry or the Authority, each
according to its powers, in this respect in coordination with the competent authority.
Article (274) – Conversion of the Company into another Legal Form
1. Subject to the provision of Article (292) of this Law, a Public Joint Stock Company may be
converted to a Private Joint Stock Company if the following conditions are met:
a) The approval of the Common Committee formed, under a Decision by the Minister,
from the Ministry of Economy, the Securities & Commodities Authority and the
competent authority, to consider the request for conversion into a Private Joint Stock
Company;
b) The expiry of 5 audited financial years from the date of registration in the Commercial
Register as a Public Joint Stock Company. In the event of its conversion into a Private
Joint Stock Company, the company may not apply to be converted into a Public Joint
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Stock Company once again until the expiry of 5 audited financial years from the date of
registration in the Commercial Register as a Private Joint Stock Company; and
c) Issuing a special Decision by the General Assembly in approval of the conversion of the
majority shares representing 90% of the capital of the company.
2. Other than Public Joint Stock Company, a company may convert into a Joint Liability
Company, a Simple Commandite Company, a Limited Liability company or a Private Joint
Stock Company if the following conditions are met:
a) Issuing a Decision in accordance with the applicable conditions to amend the
Memorandum of Association and the Articles of Association of the company.
b) The expiry of a period of at least two audited financial years of the company from the
date of its registration in the Commercial Register.
c) The unanimous consent of the partners in the event of conversion into a Joint Liability
Company.
d) The completion of the applicable incorporation and registration procedures to the
proposed form of conversion.
Article (275) – Conversion to a Public Joint Stock Company
Subject to the provisions of Article (273) of this Law, it is conditional for the conversion of a
company into a Public Joint Stock Company that:
1) The value of the issued shares or stocks has been paid in full or the shares of the partners
have been paid in full;
2) A period of at least two audited financial years has expired;
3) The company made net operational profits distributable to the shareholders or partners,
from the activity for which the company is established, for an average of 10% of the capital,
within the two financial years preceding the application for conversion.
4) That a special Decision or any similar action is issued to convert the company into a Public
Joint Stock Company.
5) Any other conditions under a Decision by the Authority’s Board of Directors.
Article (276) – Documents of Conversion into a Public Joint Stock Company
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1. Any company may be converted into a Public Joint Stock Company, under an application
on such form prepared by the Authority for such purpose, executed by the authorized
signatory of the company.
2. The following documents shall be attached to the application:
a) The amended Memorandum of Association and Articles of Association of the
company;
b) The Decision by the General Assembly of the relevant company or anybody in lieu
thereof passed by the applicable majority to amend the Memorandum of Association or
Articles of Association of the company, including the approval of any necessary
increase of the capital and the conversion of the company into a Public Joint Stock
Company. The Decision by the partners or shareholders for conversion shall include
any changes of the Memorandum of Association or Articles of Association of the
company as required in the circumstances, including the change of the name of the
company;
c) The approval by the Ministry and the competent authority for the conversion of the
company into a Public Joint Stock Company;
d) A balance sheet of the company prepared within six months prior to the date of the
application for conversion, in addition to a copy of a reservation free report from the
auditor of the company regarding such balance sheet;
e) A written statement by the auditors of the company, confirming that the net assets of the
company on the date of preparing the balance sheet are not less than its required share
capital and undistributed reserves.
f) An assessment of the contributions in kind of the company, prepared in accordance with
the provisions of Article (118) of this Law.
g) An acknowledgement by the managers or the Board of Directors, as the case may be,
confirming that the following conditions are met:
– That a Decision is issued by the General Assembly of the company or any similar
body in lieu thereof approving the conversion is issued and that all the other
requirements under this Law are satisfied; and
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– That there is no adverse material change of the financial position of the company
during the period from the date of the relevant balance sheet and the date of
application for conversion; and
h) Any other documents as required by the Authority for conversion.
Article (277) – Announcement of the Conversion Decision
1. The company shall announce the conversion Decision in two daily local newspapers issued
in the State, one of them issued in Arabic, within 5 (five) working days from the date of the
conversion Decision and shall notify the shareholders / partners and the creditors by
registered letters.
2. The announcement and the notice to the shareholders / partners and the creditors as set forth
in Clause 1 of this Article shall include the right of any of the creditors of the company and
the holders of loan bonds or Sukuk, and any concerned shareholders or partners may object
to the conversion at the head office of the company.
Article (278) – Objection to the Conversion Decision
1. A partner or shareholder that objects to the conversion Decision may withdraw from the
company and recover the value of his stocks or shares, by an application in writing to the
company within 15 (fifteen) days from the date of completion of the publication of the
conversion Decision. The value of the shares or stocks shall be paid according to their
market or book value on the date of conversion, whichever is higher.
2. The shareholders / partners, the creditors of the company and the holders of loan bonds or
Sukuk and any concerned party may object before the company within 30 (thirty) days from
the date of the notice of the conversion Decision and a copy of the objection shall be
delivered to the Ministry or the Authority, as the case may be, and the competent authority,
provided that the objecting party states the subject matter of its objection and the grounds of
such objection and such damage that such conversion may specifically cause to the
objecting party, as alleged by such party.
3. If the company fails to settle the objections for any reason whatsoever within no later than
30 (thirty) days from the date of delivery of a copy of the objection to the Ministry or the
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Authority, as the case may be, and the competent authority, the objecting party may resort
to the Competent Court.
4. The conversion Decision shall remain suspended unless the objection is waived or the Court
rejects the objection under a final judgment, or the company pays the debt if current or
provides sufficient securities if deferred.
5. If the conversion Decision is not objected thereto within the period as provided by Clause 2
of this Article, such omission shall be deemed as implicit acceptance of the conversion.
Article (279) – Sale of Part of the Shares of the Company upon its Conversion
1. Subject to the provisions of Article (117)/2 of this Law, a company proposing to be
converted into a Public Joint Stock Company may sell by way of public subscription 30%
maximum of its capital after assessment in accordance with the provisions of Article (118)
of this Law.
2. The Chairman of the Authority shall issue a Decision regulating the terms and conditions
for the sale of part of the shares of the company upon its conversion.
Article (280) – Notification of the Conversion Decision
Subject to the provisions of Article (274) of this Law, the company shall provide a copy of the
Decision for conversion to the Ministry or, as applicable, the Authority and the competent
authority, together with:
1) A statement of the assets, rights and obligations of the company and the assessed value of
such assets, rights and obligations; and
2) A statement of the settlement of the objection or the expiry of its term.
Article (281) – The Results of Conversion
1. Upon conversion, every partner or shareholder shall have a number of shares or stocks in
the new company equal to the value of his shares or stocks in the company prior to
conversion. If the value of the shares or stocks of a partner is less than the applicable
minimum limit of the nominal value of the new shares or stocks, the difference shall be
completed in cash, failing which such partner shall be deemed to have withdrawn from the
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company. The value of his shares or stocks shall be paid according to their market or book
value on the date of conversion, whichever is higher.
2. After its conversion and re-registration under its new legal form, the company shall
maintain its corporate personality and its rights and obligations prior to such conversion.
Such conversion shall not discharge the acting partners from the obligations of the company
prior to the conversion, unless the creditors agree thereto in writing.
Article (282) – Entry of the Conversion
1. After approval of the conversion Decision by the Ministry or, as applicable, the Authority
and the competent authority, the particulars kept by the Registrar shall be amended;
2. The competent authority shall enter the company in the Commercial Register and issue a
commercial license according to the new form of the company. The conversion shall be
effective from the date of issuing the commercial license.

Chapter II: Merger
Article (283) – Merger
1. Notwithstanding the provisions of Articles (197), (198) and (199), the company may, under
a special Decision issued by the General Assembly or any similar body, even during the
liquidation process, merge with another company by a contract to be made between the
merged companies in this respect.
2. Subject to the applicable rules of the Central Bank, in the event of merger of the companies
licensed by the latter, the Minister shall issue the Decision regulating the methods,
conditions and procedures of merger in respect of all companies, except the Public Joint
Stock Companies, as the Board of Directors of the Authority issues the Decision concerning
such companies.
Article (284) – Merger Contract
The merger contract shall determine the conditions and method of merger. In particular, it shall
determine the following issues:
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1) The Memorandum of Association and Articles of Association of the merging company or
the new company after merger;
2) The name and address of each member of the Board or the proposed manager of the
merging company or the new company.
3) The method of conversion of the shares or stocks of the merged companies to shares or
stocks of the merging company or the new company.
Article (285) – Presenting the Merger Contract to the General Assembly
1. The Board members or Managers of every merged and merging company shall present the
draft merger contract to the General Assembly or any other similar body for approval by the
applicable majority for the amendment of the Memorandum of Association of the
company.
2. The invitation of the General Assembly to convene to consider the merger:
a) Shall be accompanied by a copy or summary of the merger contract;
b) The contract shall clearly state the right of any one or more shareholders holding at
least 20% of the capital of the company, who objected to the merger, to appeal the
merger before the Competent Court within 30 (thirty) days from the date of approval of
the merger contract by the General Assembly or any other similar body.
Article (286) – Merger of Holding Companies and Subsidiaries
1. A Holding Company may merge with one or more of the companies held by such Holding
Company in full as a single company without entry into a merger contract. Merger shall be
made under a special Decision by such companies, passed by the applicable majority to
amend the Memorandum of Association of each company.
2. Two or more companies fully held by a Holding Company may merge into a single
company without entry into a merger contract.
3. In the event of merger where the merged company is a Holding Company, the provisions of
merger in this Law and the Decisions issued in execution hereof shall apply to its
subsidiaries held in full by the Holding Company.
Article (287) – Refunding the Value of Shares
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1. Except for the Joint Stock companies, the partners who object to the merger Decision may
demand to withdraw from the company and to recover the value of their shares, by
providing a written request to the company within 15 (fifteen) working days from the date
of the merger Decision.
2. The value of the shares, the subject matter of withdrawal, shall be assessed by mutual
agreement. In the event of disagreement on such assessment, the issue shall be referred to a
committee formed by the competent authority for this purpose in respect of all companies
prior to resorting to the Court.
3. The undisputed value of the shares, the subject matter of the withdrawal, shall be paid to
their holders prior to completing the merger procedures and prior to resorting to the
committee as set forth in the preceding Clause in connection with the disputed value.
Article (288) – Notification of the Creditors of the Merger Decision
Every merging company or merged company shall notify its creditors within 10 (ten) working
days from the date of approval of the merger by the General Assembly, provided that such
notice shall:
1) State that the company intends to merge with one or more companies;
2) Be sent in writing to every creditor of the company to notify him of the merger;
3) Be published in two daily local newspapers issued in the State, provided that one of them is
issued in Arabic; and
4) Provide for the right of any of the creditors of the (merging and merged)
company/companies, the holders of loan bonds or Sukuk and any concerned party to object
to the merger at the head office of the company, and to deliver to the Ministry or the
Authority, as the case may be, a copy of the objection, within 30 (thirty) days from the date
of the notice.
Article (289) – Objection to the Merger
1. A creditor that notifies the company of his objection in accordance with the provisions of
Clause 4 of Article (288) of this Law, without payment or settlement of his claim by the
company within 30 (thirty) days from the date of the notice, may apply to the Competent
Court to order to suspend the merger.
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2. If, at the time of filing the application to suspend the merger, the Court finds that the merger
shall adversely affect the interests of the applicant unlawfully, the Court may order to
suspend the merger, in accordance with any other conditions as it may deem appropriate.
3. Merger shall remain suspended unless the objection is waived, or the Court rejects the
objection under a final judgment, or the company pays the debt if current or provides
sufficient securities if deferred.
4. If the merger Decision is not objected thereto within the period as provided by Clause 4 of
Article (288) of this Law, such omission shall be deemed as implicit acceptance of the
merger Decision.
Article (290) – Approval of the Merger
1. Upon approval of the merger Decision by the Ministry or, as applicable, the Authority, the
particulars kept by the Registrar shall be amended;
2. The competent authority shall enter the termination of the merged company and notify the
Ministry or the Authority of the same, as the case may be.
Article (291) – Results of the Merger
Merger means that the merged company or companies shall cease to be a legal person(s) and
that the merging company or the new company shall substitute such company or companies in
all their rights and obligations. The merging company shall be a legal successor of the merged
company or companies.

Chapter III: Appropriation
Article (292) – Appropriation Process
Any person or group of associated persons or related parties desiring to purchase or do any act
that may lead to the appropriation of shares or securities convertible to stocks in the capital of a
Public Joint Stock Company incorporated in the State, which offered its shares for public
subscription or listed in a Financial Market in the State, shall comply with the provisions and
Decisions regulating the rules, conditions and procedures of appropriation issued by the
Authority.
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Article (293) – Contravention of the Appropriation Rules and Procedures
Without prejudice to the right of the damaged parties to resort to the Court, if it is established
that any person contravened the provisions of Article (292) of this Law or the Decision issued
by the Authority in this respect, the Authority may take either of the following Decisions:
1) To cancel the purchase or disposition that results in the appropriation process or processes.
The contravening party shall be subject to a fine of not less than 20% and not exceeding
100% of the value of appropriation process and Article 339 on the regulation of conciliation
shall be applied.
2) To deprive the contravening party from nomination or participation in the Board of
Directors of the company whose shares are appropriated and to deprive such party from
voting at the meetings of the General Assembly, to the extent of such contravention.
Article (294) – Publication of the Appropriation Decision
The Appropriation Decision shall be published in two local daily newspapers issued in the
State, one of them issued in Arabic, at the expense of the appropriating company.
TITLE VIII. TERMINATION OF THE MEMORANDUM OF ASSOCIATION OF THE
COMPANY
Chapter I: Reasons for the Termination of Companies
Article (295) – General Reasons for the Termination of Companies
Subject to the Provisions concerning the termination of companies, a company shall be
dissolved for any of the following grounds:
1) The expiry of the term provided in the Memorandum or the Articles of Association of the
company, unless such term is renewed in accordance with the rules provided in either of
them;
2) The depletion of the objective for which the company was established;
3) The loss of all or most of the assets of the company, so that the investment of the balance
shall not be economically profitable;
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4) Merger in accordance with the provisions of this Law;
5) Unanimous consent by the partners to end its term, unless the Memorandum of Association
provides that a specific majority is sufficient; or
6) The issuance of a judgment to dissolve the company.
Article (296) – Dissolution of a Joint Liability and Simple Commandite Company
Without prejudice to the rights of third parties, and subject to the provisions of this Law and the
contracts made between the partners, the Joint Liability Company and the Simple Commandite
Company shall be dissolved for any of the following reasons:
1) The death, bankruptcy or insolvency of any of the partners of the company or his loss of
legal capacity, unless agreed otherwise in the Memorandum of Association of the company.
It may be provided in the Memorandum of Association of the company for its continuation
with the heirs of the dead partners, even if all or any of the heirs are minors. If the dead
partner is an acting partner and the heir is a minor, the minor shall be deemed as a silent
partner to the extent of his share from the estate. In such event, the continuity of the
company shall not be conditional by issuing a court order to keep the assets of the minor in
the company.
2) If the only acting partner withdraws from the Simple Commandite Company; or
3) If, for six months, the Joint Liability Company remains with a single partner and the
company fails to adjust its legal position during such period.
Article (297) – Continuity of the Joint Liability Company or the Simple Commandite
Company by Agreement
1. Unless the Memorandum of Association of the Joint Liability Company or the Simple
Commandite Company provides for its continuity for the other partners in the event of
withdrawal or death of a partner, issuing a judgment of interdiction or declaring his
bankruptcy or insolvency, the partners may, within 60 days from the date of occurrence of
any of the above events, resolve unanimously to continue in the company as between
themselves. The partners shall enter such agreement with the competent authority within the
above sixty days.
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2. If the company continues with the remaining partners, the share of the withdrawing partner
shall be assessed according to the last inventory, unless the Memorandum of Association of
the company provides for another method of assessment. Such partner or his heirs shall
have no share in the rights of the company upon such withdrawal other than to the extent
such rights are derived from transactions made prior to his withdrawal from the company.
Article (298) – Order to Dissolve a Joint Liability Company or a Simple Commandite
Company
1. The Court may rule to dissolve any Joint Liability Company or Simple Commandite
Company on demand by a partner if the Court finds serious reasons to justify such
dissolution. The Court may also rule to dissolve the company on demand of a partner due to
the failure by a partner to perform his undertakings.
2. If the reasons justifying the dissolution arise from acts of a partner, the Court may rule to
exit him from the company. In such event, the company shall continue as between the other
partners and shall deduct the share of the partner upon its assessment in accordance with the
last inventory or by any means that the Court may determine to follow.
3. Any condition to deprive a partner from using the right to dissolve a company by the Court
shall be deemed void ab initio.
Article (299) – Dissolution, Liquidation or Suspension of the Activity of a Sole
Proprietorship
1. The Sole Proprietorship Company shall be dissolved upon the death of the natural person or
the termination of the legal person that founded it. However, the company shall not be
terminated by the death of the natural person in a Sole Proprietorship Company if the heirs
choose to continue in the company, upon adjusting its position in accordance with the
provisions of this Law. Such heirs shall choose a representative to manage the company on
their behalf, within no later than six months from the date of death.
2. If the owner of a Sole Proprietorship liquidates it or suspends its activity prior to the expiry
of its term or the achievement of the objective for which it was established in bad faith, the
owner shall be liable for its obligations from his own funds.
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Article (300) – Death or Withdrawal of a Partner in a Limited Liability Company
The death of a partner in a Limited Liability Company or his withdrawal by a judgment of
interdiction or declaring his bankruptcy or insolvency shall not lead to its dissolution unless the
Memorandum of Association of the company so provides. The share of a partner shall be
transferred to his heirs. A legatee shall be considered as an heir.
Article (301) – Losses of a Limited Liability Company
1. If the losses of a Limited Liability Company reach half the capital, the Managers shall refer
to the General Assembly of the partners the issue of dissolution. The dissolution Decision
shall be passed by the applicable majority to amend the Memorandum of Association of the
company.
2. If the losses reach three quarters of the capital, the partners holding one quarter of the
capital may demand to dissolve the company.
Article (302) – Losses of Joint Stock Company
1. If the losses of a Joint Stock Company reach half of its issued capital, the Board of
Directors shall within 30 (thirty) days from the date of disclosure to the Ministry or the
Authority, as applicable, of the periodical or annual financial statements invite the General
Assembly to take a special Decision to resolve the company prior to the expiry of its term or
to continue in the activity of the company.
2. If the Board of Directors fails to invite the General Assembly to convene or if the General
Assembly fails to issue a Decision in the matter, each concerned party may file a lawsuit
before the Competent Court seeking to dissolve the company.
Article (303) – Deregistration of the Company
1. Subject to the events as set forth in this Law or in any other Law, if the Ministry, the
Authority or the competent authority, as applicable, confirms that the company ceased to
conduct its business or that it conducts such business in contravention of the provisions of
this Law and the Decisions issued in execution hereof, the Ministry, the Authority or the
competent authority, as applicable, shall notify the company that it shall be deregistered
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within three months from the date of the notice, unless a good reason not to deregister the
company is provided.
2. If the Ministry, the Authority or the competent authority, each within its own competence,
receives upon the expiry of the three months as set forth in Clause 1 of this Article a
confirmation that the company still suspends its business or if the company fails to provide
a reasonable justification for such suspension, the issue shall be referred to the competent
court to take the required procedure in connection with the liquidation of the company.
3. The liability of the Board members, Managers, Shareholders and Partners of the company
deregistered in accordance with the provisions of this Article shall continue as if the
company has not been dissolved.
Article (304) – Notification of the Competent Authority and the Registrar of the
Dissolution
1. The entity authorized to manage the company shall notify the competent authority and the
Registrar if any of the reasons for the dissolution of the company is available.
2. If the partners agree to dissolve the company, the agreement shall include the method of
liquidation and the name of the liquidator.
3. Upon the dissolution or liquidation of the company, no partner or shareholder shall be
entitled to a share of its capital until the repayment of its debts.
Article (305) – Entry of the Dissolution of the Company
The Managers of the company, the Chairman and the Liquidator, as applicable, shall enter the
dissolution of the Commercial Register with the competent authority and publish the
dissolution in two daily local newspapers; one of them is issued in Arabic. The dissolution of
the company shall not be effective against third parties until the date of such registration.
Chapter II: Liquidation of the Company and the Division of its Assets
Article (306) – Applicable Provisions in Liquidation
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Unless the Memorandum of Association or Articles of Association of the company provides for
the method of liquidation or the partners agree otherwise upon the dissolution of the company,
the provisions of this Law shall apply to the liquidation of the company.
Article (307) – Termination of the Authority of the Managers or the Board of Directors
The authority of the Managers or the Board of Directors shall terminate by the dissolution of
the company. However, they shall continue to manage the company and they shall be
considered as liquidators to third parties until a liquidator is appointed. The management of the
company shall remain in existence during the period of liquidation, and to such extent, and
within the powers as the liquidator may see required for the liquidation process.
Article (308) – Appointment of the Liquidator
1. The liquidation shall be conducted by one or more liquidators appointed by the partners or
under a Decision by the General Assembly or any other similar body, provided that the
liquidator is not an auditor of the company at the time being or has already audited its
accounts within five years preceding the appointment.
2. If liquidation is made under a judgment, the competent Court shall point out the method of
liquidation and appoint the liquidator. In all events, the task of the liquidator shall not be
terminated by the death, declaration of bankruptcy, insolvency or interdiction ordered
against the partners, even if the liquidator is appointed by the partners.
Article (309) – Multiple Liquidators
If there is more than one liquidator, their acts shall not be valid without the unanimous consent
of the liquidators, unless the document appointing them provides otherwise. This condition
shall not be effective against third parties until the registration thereof in the Commercial
Register.
Article (310) – The Decision appointing the Liquidator
The liquidator shall enter the Decision appointing him and the agreement of the partners or the
Decision issued by the General Assembly concerning the method of liquidation or the judgment
issued for such purpose in the Commercial Register. The appointment of the liquidator or the
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method of liquidation shall not be effective against third parties other than from the date of
entry thereof in the Commercial Register. The liquidator shall charge such fee as determined in
the document appointing him, failing which the Competent Court shall determine such fee.
Article (311) – Dismissal of the Liquidator
1. The liquidator shall be dismissed in the same way as he has been appointed. Any decision
or judgment to dismiss a liquidator shall include the appointment of a new liquidator.
2. The dismissal of a liquidator shall be entered in the Commercial Register and such
dismissal shall not be effective against third parties other than from the date of such
registration.
Article (312) – Inventory of the Assets and Liabilities of the Company
The liquidator shall, immediately upon his appointment, shall prepare an inventory of all the
assets and liabilities of the company. The managers or the Chairman shall provide to the
liquidator the books, documents and assets of the company.
Article (313) – Preparation of a List of the Assets and Liabilities of the Company
The liquidator shall issue a detailed list of the assets and liabilities of the company and its
balance sheet to be signed by the managers of the company or its Chairman. The liquidator
shall keep a book to enter the liquidation procedures.
Article (314) – Duties of the Liquidator
The liquidator shall do everything required to maintain the assets and rights of the company
and collect the debts of the company from third parties and shall deposit the amounts collected
in a bank for the account of the company under liquidation immediately upon such collection.
However, the liquidator may not demand the partners to pay the balance value of their shares
other than as required for the liquidation process and provided that the partners are treated
equally.
Article (315) – The Liquidator as a Representative of the Company
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The liquidator shall do all acts required for the liquidation and in particular to represent the
company before the Courts, to pay the company’s debts, to sell the movables and real estates of
the company at a public auction or by any other way, unless the document appointing the
liquidator provides for a specific way for the sale. However, the liquidator may not sell the
assets of the company all at once without permission from the partners or the General
Assembly of the company.
Article (316) – Notification of the Creditors of the Liquidation
All the debts payable by the company shall become immediately outstanding upon its
dissolution. The liquidator shall notify all the creditors by registered letters with
acknowledgment of receipt of the commencement of the liquidation, inviting the creditors to
present their claims. The notice shall be published in two local daily newspapers; one of them
is issued in Arabic. In all events, the notice of liquidation shall include a period granted to the
creditors for at least 45 days from the date of the notice to present their claims.
Article (317) – Repayment of the Debts of the Company
If the assets of the company are not sufficient to repay all the debts, the liquidator shall pay part
of such debts, without prejudice to the rights of preferred creditors. Every debt arising from the
liquidation procedures shall be settled from the funds of the company before any other debts.
Article (318) – Deposit of the Debts in the Court Treasury
If some creditors fail to provide their claims, their debts shall be deposited in the treasury of the
Competent Court. Sufficient amounts to pay the share of the disputed debts shall also be
deposited, unless the holders of such debts obtain adequate securities or it is resolved to
adjourn the division of the assets of the company until the conclusion of the dispute in the said
debts.
Article (319) – New Works of the Company
The liquidator shall not commence new works other than as required to complete previous
works. If the liquidator performs any new works not required for liquidation, the liquidator
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shall be liable from all his funds for such works. If there is more than one liquidator, they shall
be jointly liable.
Article (320) – Term of Liquidation
The liquidator shall complete his task within the period as determined in the document
appointing him. If no such period is determined, any partner may refer the issue to the
Competent Court to determine the term of liquidation.
Such period may not be extended other than under a Decision by the partners or under a special
Decision by the General Assembly, as the case may be, upon inspection of the liquidator’s
report stating the reasons for not completing the liquidation in due time. If the term of
liquidation is determined by the Competent Court, it may not be extended without the consent
of the Court.
Article (321) – Interim Account of the Liquidation Procedures
The liquidator shall provide to all the partners or the General Assembly every three months an
interim account of the liquidation procedures. The liquidator shall state any information and
statements as required by the partners on the status of liquidation. Within one week from the
date of the approval by the General Assembly, the liquidator shall notify the partners to receive
their dues within no later than 21 days under an announcement to be published in two daily
local newspapers, one of them issued in Arabic.
Article (322) – Final Account of the Liquidation
1. The liquidator shall, upon completion of liquidation, provide to the partners or the General
Assembly or to the Competent Court a final account of the liquidation process. Such
process shall be complete upon approval of the final account.
2. The liquidator shall enter the completion of the liquidation in the Commercial Register with
the competent authority. The completion of liquidation shall not be effective against third
parties other than from the date of such entry. The registration of the company shall be
stricken off from the Commercial Register kept with the competent authority.
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Article (323) – Acts of the Liquidator
The company shall comply with the liquidator’s acts required for the procedures of liquidation
as long as such acts are within the limits of the liquidator’s powers. The liquidator shall not be
liable, whatsoever, due to taking such procedures.
Article (324) – Liability of the Liquidator
The liquidator shall be liable if he mismanages the affairs of the company during the period of
liquidation. The liquidator shall also be liable for the damage incurred by third parties due to
his professional faults in the liquidation process.
Article (325) – Division of the Assets of the Company
1. The assets of the company resulting from liquidation shall be divided among all the partners
upon payment of the debts. Each partner, upon division, shall obtain an amount equal to his
share in the capital, and the rest shall be divided among the partners at the pro rate of their
shares in the profits. If a partner fails to appear to collect his share, the liquidator shall
deposit such share in the treasury of the Competent Court.
2. If the net funds of the company are not sufficient to pay the shares of the partners in full, the
loss shall be distributed among them in accordance with the prescribed rate for the
distribution of losses.
Article (326) – Barring of the Liability Lawsuit by Limitation
1. Upon denial and lack of legitimate excuse, lawsuits against the liquidator on the ground of
the liquidation works and lawsuits against the partners, managers or members of the Board
or the auditors of the company due to their jobs shall be barred by limitation upon the
expiry of three years, unless the Law provides for a shorter period.
2. Such period shall be calculated from the date of entering the completion of liquidation in
the Commercial Register in the former event, and from the date of the act creating liability
in the latter event.
3. If the act attributed to any of such persons may be a crime, the liability lawsuit shall not be
barred until the public lawsuit is barred.
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TITLE IX. FOREIGN COMPANIES
Article (327) – Foreign Companies governed by the Provisions of this Law
Subject to the special agreements made between the Federal Government or the local
Government or any entity of either of them and foreign companies, the provisions of this Law,
excluding the provisions concerning incorporation, shall apply to the foreign companies that
conduct their activities in the State or their place of management is based in the State.
Article (328) – Performance by a Foreign Company of its Activity
1. Other than foreign companies licensed to conduct their activities in free zones in the State,
foreign companies may not conduct an activity inside the State or set up an office or branch
therein without a license to this effect by the competent authority with the consent of the
Ministry. The license issued shall determine the activity that the company is licensed to
conduct.
2. If a foreign company or its office or branch conducts its activity in the State prior to
completion of the above procedures in this Law, the persons who conduct such activity shall
be personally and jointly liable for such activity.
Article (329) – Agent of Foreign Company
The agent of a foreign company shall be a UAE national. If the agent is a company, it shall be a
UAE company and all its partners shall be UAE nationals. The obligations of the agent to the
company and third parties shall be limited to providing such services to the company, without
any responsibility or financial obligations in connection with the business or activity of the
branch or office of the foreign company inside the State or abroad.
Article (330) – Registration Procedures of Foreign Companies
1. No foreign company shall conduct its activity in the State unless entered in the Foreign
Companies Register with the Ministry in accordance with the provisions of this Law and
until the company has obtained the required approvals and licenses under the applicable
Laws in the State.
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2. The procedures of registration in the Foreign Companies Register and the conditions to
prepare the accounts and balance sheets of the branches of foreign companies in the State
shall be determined under a Decision by the Minister. The office or branch of a foreign
company shall be deemed as its domicile in respect of its activity in the State. The activity
to be conducted shall be governed by the provisions of the applicable Laws in the State.
3. The Ministry shall issue such Decisions stating the documents required to be attached to the
application for registration. Such Decisions may determine such events and conditions that
should be observed for the management and closure of the branch or office of the foreign
company.
4. In the event of closure of a branch of a foreign company, the Ministry shall strike off the
name of such branch or office from the Foreign Companies Register kept by the Ministry.
Article (331) – Balance Sheet of the Foreign Company
Other than representative offices, foreign companies or their branches shall have an
independent balance sheet and an independent profits and losses account and shall have an
auditor registered in the roll of auditors operating in the State. Such foreign companies or
branches shall be provide to the competent authority and the Ministry annually a copy of the
balance sheet and the final accounts, together with a report by the auditor and a copy of the
final accounts to its holding company, if any.
Article (332) – Representative Offices
1. Foreign companies may establish representative offices whose object is limited to market
and production capabilities study without performance of any commercial activity.
2. The Executive Decisions of this Law shall determine the aspects of control exercised by the
Ministry and the competent authority on such offices.
TITLE X. CONTROL AND INSPECTION OF COMPANIES
Article (333) – Control of Companies
1. Subject to the jurisdictions of the Central Bank, the Ministry, the Authority and the
competent authority, as applicable, shall have the right of control of joint stock companies
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and to inspect the works, books or any papers or records at the branches and subsidiaries of
the companies inside the State and abroad or in the custody of the auditor or any other
company related to the company, the subject matter of inspection. It may, together with the
Inspection Committee, seek the assistance of one or more experts with the required
technical and financial experience in the subject matter of inspection, to verify that the
company is compliant with the provisions of this Law and the decisions issued in execution
hereof and with the Articles of Association of the company. The inspectors may demand, at
their own discretion, any information or statements from the Board of Directors, the
Executive Officer, the Managers or the Auditors of the company.
2. The Ministry, the Authority or the competent authority, as the case may be, may request to
dissolve the company if incorporated or if it performs its activity in violation of the
provisions of this Law. The Competent Court shall decide on such request as a matter of
urgency.
Article (334) – Inspection Regulation
The Minister shall issue the regulation for inspection of the private joint stock companies. The
Board of Directors of the Authority shall issue the regulation for inspection of Public Joint
Stock Companies. The regulation shall determine the inspection procedures and the powers and
duties of the inspectors.
Article (335) – Request for Inspection of the Company
1. Subject to the provisions of Articles (333) and (334) of this Law, shareholders holding at
least 10% of the capital of the company may request the Minister or, as applicable, the
Authority to order to inspect the company in respect of the serious breaches attributed to the
members of the Board or the auditors upon performing their duties as provided by this Law
or the Articles of Association so long reasons to make the occurrence of such breaches
highly probable.
2. The request for inspection shall include:
a) Such evidence that the applicants have serious grounds to justify taking such
procedures.
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b) The deposit by the applicant shareholders of their shares and to remain deposited until
the conclusion of the request.
3. The Ministry or, as applicable, the Authority may, after hearing the statements of the
applicants and the Board members or any other similar body and the auditors at a secret
hearing, order to inspect the works, books or any papers or records with another company
associated with the company, the subject matter of inspection, or in the custody of the
auditor, and may appoint for such purpose one or more experts at the expense of the
applicants for inspection.
Article (336) – Facilitating the Work of the inspectors
Subject to the provisions of Article (333) of this Law, the Chairman, Executive Officer,
General Manager, personnel and Auditors of the company shall provide to those assigned for
inspection all the books, minutes of meeting (Board of Directors, committees and General
Assemblies), records, documents and papers of the company as they deem necessary and
provide the required statements and information.
Article (337) – Inspection Report
1. Subject to the provisions of Articles (334) and (335) of this Law, upon completion of the
inspection, the inspectors shall provide a final report to the Minister in respect of Private
Joint Stock Companies or to the Chairman of the Authority in respect of Public Joint Stock
Companies.
2. If the Ministry or, as applicable, the Authority finds that there are breaches constituting a
crime against the Board members or the auditors, it shall invite the General Assembly to
convene. In such event, the meeting shall be chaired by the representative of the Ministry or
the Authority, as the case may be, of a degree of an executive officer or any similar officer,
to consider the following:
a) The dismissal of the Board members and filing the liability lawsuit against them; and
b) The dismissal of the auditors and filing the liability lawsuit against them.
3. The Decision by the General Assembly shall be valid in the event as set out in Clause 2 of
this Article if approved by the present majority upon exclusion of the share of the Board
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member whose dismissal is under consideration. In the event of the Board member that
represents a legal person, the share of such legal person shall be excluded.
Article (338) – Publication of the Results of Inspection
If the Ministry or, as applicable, the Authority finds that the breaches attributed by the
applicants for inspection to the Board members or the auditors are not true, the Ministry or the
Authority may order to publish the result of inspection in a daily local newspaper issued in
Arabic and require the applicants for inspection to pay its costs, without prejudice to civil and
penal liability as applicable.

TITLE XI. PENALTIES
Chapter I. Crimes Where Reconciliation Is Possible
Article (339) – Regulation of Conciliation
1. The criminal lawsuit for the crimes set forth in Chapter One of this Title shall not be filed
unless by a written request from the Chairman of the Authority or his representative
concerning the crimes related to the Public Joint Stock companies and from the Minister or
his representative for the crimes related to others. Conciliation is possible before referral of
the criminal lawsuit to the competent Court against payment of an amount not less than two
times the minimum fine limit, if any, and equivalent to the daily fine.
2. In the event of repetition of the crime within one year from the conciliation or return to the
crime after issuance of a final judgment, the fines set forth in this Chapter in their minimum
and maximum limits shall be doubled.
3. The Minister or the Authority, as applicable, shall issue the conciliation rules and
procedures.
Article (340) – Failure to Comply with the Decision of the Registrar
A fine of AED 1,000 (one thousand) per day shall be imposed on any company that fails to
comply with the decision by the Registrar concerning the change of the name of the company.
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Such fine shall be calculated upon the expiry of 30 working days from the date of notifying the
decision to the company.
Article (341) – Failure to List
A fine of AED 2,000 (two thousand) per day shall be imposed on any Public Joint Stock
Company that fails to be listed in a financial market in the State. Such fine shall be calculated
for every day of delay after expiry of the required period for listing in accordance with the
provisions of this Law.
Article (342) – Rejection of Inspection by Concerned Parties
A fine of at least AED 10,000 (ten thousand), but not more than AED 50,000 (fifty thousand)
shall be imposed on the company that rejects to enable the partner or shareholder to inspect the
minutes of meetings of the General Assembly or the company’s books, documents or any
records related to a transaction concluded by the Company with relevant parties.
Article (343) – Failure to Invite the Annual General Assembly to Convene
A fine of at least AED 50,000 (fifty thousand), but not more than AED 100,000 (one hundred
thousand) shall be imposed on the Chairman of a Joint Stock Company if he fails to invite the
Annual General Assembly of the company to convene within the period as determined by this
Law or if he publishes the invitation without the prior consent of the Ministry or, as applicable,
the Authority, and on any Director that deliberately prevents the invitation or convention of the
General Assembly.
Article (344) – Failure to Invite the General Assembly in Case of Losses
A fine of at least AED 50,000 (fifty thousand), but not more than AED 1,000,000 (one million)
shall be imposed on the Chairman of a Joint Stock Company or the Chairman of a Limited
Liability Company if the losses of the company reach half of its capital and the Board fails to
invite the General Assembly of the company to convene in accordance with the provisions of
this Law.
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Article (345) – Failure to Invite the General Assembly on Demand by the Ministry or the
Authority
A fine of at least AED 100,000 (one hundred thousand), but not more than AED 300,000 (three
hundred thousand) shall be imposed on the Chairman of a Joint Stock Company or his
representative if he fails to invite the General Assembly of the company to convene upon
receipt of a request to this effect from the Ministry or, as applicable, the Authority.
Article (346) – Failure to invite one of the Board Members to Attend the Board Meetings
A fine of at least AED 50,000 (fifty thousand), but not more than AED 100,000 (one hundred
thousand) shall be imposed on the Chairman of a Joint Stock Company or his representative if
he fails to invite a Board member to attend the Board meetings.
Article (347) – Rejection to Provide Assistance to the Auditors or Inspectors
A fine of at least AED 10,000 (ten thousand), but not more than AED 100,000 (one hundred
thousand) shall be imposed on the Chairman, Board member, Executive Officer, General
Manager or other employee of a company if he rejects to provide documents or information to
the auditors of the company or to the inspectors from the Ministry or the Authority to perform
their duties, conceals information or explanations or provides misleading information to such
auditors or inspectors.
Article (348) – Failure to keep Accounting Records
A fine of at least AED 50,000 (fifty thousand), but not more than AED 500,000 (five hundred
thousand) shall be imposed on the national or foreign company that fails to keep accounting
records for the company to state its deals.
Article (349) – Failure to keep Accounting Records for the Period determined in this Law
A fine of at least AED 20,000 (twenty thousand), but not more than AED 100,000 (one
hundred thousand) shall be imposed on the national or foreign company that fails to keep
accounting records for the period determined in this Law.
Article (350) – Auditors not approved by the Authority
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1. A fine of at least AED 20,000 (twenty thousand), but not more than AED 100,000 (one
hundred thousand) shall be imposed on the auditor that audits the accounts of a Joint Stock
Company in the State without being approved by the Authority.
2. A fine of at least AED 50,000 (fifty thousand), but not more than AED 200,000 (two
hundred thousand) shall be imposed on the Chairman of a Joint Stock Company, who
assigns an auditor to audit the accounts of the company without being approved by the
Authority.
Article (351) – Non-Compliance by Shariah Controller and Members of the Internal
Shariah Control Committee
A fine of at least AED 10,000 (ten thousand), but not more than AED 50,000 (fifty thousand)
shall be imposed on the Shariah Controller and each member of the Internal Shariah Control
Committee in companies that operate according to the provisions of the Islamic Shariah, who
fails to comply with the requirements to perform their work as determined under a Decision by
the Cabinet.
Article (352) – Failure to refund Amounts in Excess of Subscription
A fine of at least AED 500,000 (five hundred thousand), but not more than AED 10,000,000
(ten million) shall be imposed on such entity or entities that delay in repayment of the extra
amounts paid by the subscribers and the returns thereon, in respect of which no shares are
allocated during the period as determined in this Law.
Article (353) – Breach of the Percentage of Contribution by UAE Nationals
A fine of at least AED 20,000 (twenty thousand), but not more than AED 200,000 (two
hundred thousand) shall be imposed on every company that violates the provisions in
connection with the percentage of contribution by the UAE nationals in the capital of the
companies or the percentage of UAE Directors in their Boards.
Article (354) – Disposition of the Shares in Violation to the Provisions of this Law
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A fine of at least AED 20,000 (twenty thousand), but not more than AED 200,000 (two
hundred thousand) shall be imposed on any person that may dispose of the shares in breach of
the rules as provided by this Law.
Article (355) – Failure to Register the Foreign Company with the Registrar or the
Competent Authority
A fine of at least AED 100,000 (one hundred thousand), but not more than AED 500,000 (five
hundred thousand) shall be imposed on a foreign company or its branch or office in the State if
not registered with the Registrar or the competent authority.
Article (356) – Performance of a Commercial Activity by a Representative Office
A fine of at least AED 100,000 (one hundred thousand), but not more than AED 500,000 (five
hundred thousand) shall be imposed on a representative office of a foreign company in the
State if it performs a commercial activity inside the State.
Article (357) – Late Adjustment of the Positions
A fine of AED 2,000 (two thousand) per day of delay shall be imposed on any company that
fails to amend its Memorandum of Association and Articles of Association to be compliant
with the provisions of this Law. Such fine shall be calculated from the day following the expiry
date of the applicable period for such purpose.
Article (358) – Publication of the Invitation to Public Subscription without the Consent of
the Authority
A fine of at least AED 100,000 (one hundred thousand), but not more than AED (ten million)
10,000,000 shall be imposed on the company, entity or natural or legal person inside the State
or abroad or in the free zones that fails to obtain the approval of the Authority prior to the
publication of announcements including an invitation to the public for subscription in any
shares, bonds or other securities, whether the announcement is made by way of publication in
the daily newspapers or the magazines or by any other means of public advertisement in the
State.
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Article (359) – Receipt of Public Subscriptions without the Consent of the Authority
A fine of at least AED 100,000 (one hundred thousand), but not more than AED 10,000,000
(ten million) shall be imposed on every entity or company that receives money from
subscription to shares, bonds or any other securities without the consent of the Authority.
Article (360) – Violation of the Provisions of this Law and the Decisions in Execution
Hereof
A fine of at least AED 10,000 (ten thousand), but not more than AED 100,000 (one hundred
thousand) may be imposed on whoever violates the provisions of this Law for which a penalty
is not stated or whoever violates the rules, regulations or decisions issued in execution thereof.

Chapter II: Crimes Where Conciliation Is Not Possible
Article (361) – Providing False Statements or Statements in Violation of the Law
A person shall be punished by imprisonment for a period between six months and three years
and/ or a fine between AED 200,000 (two hundred thousand) and AED 1,000,000 (one million)
if he deliberately inserts in the Memorandum of Association or Articles of Association of the
company or in the prospectuses of shares or bonds or in any other documents of the company,
any false statements or such statements in violation of the provisions of this Law, any other
person that may, knowingly, signs or distributes such documents.
Article (362) – Overvaluation of the Contributions In kind
Any person that may, in bad faith, assesses the contributions in kind provided by the founders
or shareholders in excess of their actual value shall be punished by imprisonment for a period
between six months and three years and/ or a fine between AED 500,000 (five hundred
thousand) and AED 1,000,000 (one million).
Article (363) – Distribution of Profits or Interests in Violation to the Law
Any manager or Board member who distributes to the shareholders or others profits or interests
in contravention of the provisions of this Law or the Memorandum of Association or Articles
of Association of the company and any auditor who approves such distribution while being
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aware of such contravention shall be punished by imprisonment for a period between six
months and three years and/ or a fine between AED 50,000 (fifty thousand) and AED 500,000
(five hundred thousand).
Article (364) – Concealing the True Financial Position of the Company
Any manager, Board member, auditor or liquidator who deliberately provides false statements
in the balance sheet or the profits and losses account or in a financial report or omits material
incidents in such documents for the purpose of concealing the true financial position of the
company shall be punished by imprisonment for a period between six months and three years
and/ or a fine between AED 100,000 (one hundred thousand) and AED 500,000 (five hundred
thousand).
Article (365) – False Incidents in the Inspection Report
The penalty of imprisonment between three months and two years and/ or a fine of at least
AED 10,000 (ten thousand), but not in excess of AED 100,000 (one hundred thousand) shall
apply against:
1) Any person appointed by the Ministry, the Authority or the competent authority to inspect
the company, who deliberately states in the inspection report false incidents or deliberately
omits to state material incidents that may affect the results of inspection; and
2) The Chairman, a Board member, the Executive Officer or the General Manager of the
company who deliberately declines to provide documents or information to the inspectors
after the Ministry or the Authority imposes the applicable fine in accordance with the
provisions of Article (347) of this Law.
Article (366) – Deliberate Damage to the Company by the Liquidator
Any liquidator who deliberately causes damage to the company, the shareholders, the partners
or the creditors shall be punished by imprisonment for a period between three months and three
years and/ or a fine between AED 50,000 (fifty thousand) and AED 500,000 (five hundred
thousand).
Article (367) – Issuing Securities in Violation to the Provisions of this Law
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Any person who issues or offers to trade in shares, subscription receipts, interim certificates or
bonds in violation to the provisions of this Law shall be punished by imprisonment for a period
between three months and two years and/ or a fine between AED 100,000 (one hundred
thousand) and AED 500,000 (five hundred thousand).
Article (368) – Giving a Loan, Guarantee or Security
The penalty of imprisonment for no later than three months and/ or a fine of at least AED
100,000 (one hundred thousand), but not in excess of AED 500,000 (five hundred thousand)
shall apply against:
1) Any Board member of the Joint Stock Company who obtains for himself or for his spouse
or relatives up to the second of kin a loan, guarantee or security from the company where he
is a Board member, in violation to the provisions of this Law, and shall be required to repay
such loan, guarantee or security.
2) The Chairman, Board member, Executive Officer or General Manager of a Joint Stock
Company who accepts to provide a loan, guarantee or security to a Board member of the
company or to his spouse or relatives up to the second of kin a loan, in violation to the
provisions of this Law.
Article (369) – Disclosure of the Secrets of the Company
The penalty of imprisonment for no later than six months and/ or a fine of at least AED 50,000
(fifty thousand), but not in excess of AED 500,000 (five hundred thousand) shall apply
against:
1) Any person who utilizes the statements or information obtained from the Constituent
Committee at any stage of incorporation of the company from the legal or financial
consultants or the subscription manager, the subscription coverage sponsor or the parties
participating in the incorporation procedures or their representatives.
2) The Chairman, Board member or other employee of the company, who utilizes or discloses
a secret of the company or deliberately attempts to cause damage to the activity of the
company.
Article (370) – Influencing the Prices of Securities
Federal Law No. (2) of 2015 On Commercial Companies
Page 127 of 128
The Chairman, Board member or other employee of the company who participates, directly or
indirectly, with any entity that makes transactions for the purpose of influencing the prices of
securities issued by the company shall be punished by imprisonment for a period of no later
than six months and/ or a fine of at least AED 1,000,000 (one million) but not in excess of
AED 10,000,000 (ten million).
Article (371) – Imposition of Severer Penalty
The penalties as provided by this Law shall be without prejudice to any severer penalty in any
other Law.
Article (372) – Criminal Liability
Criminal Liability for the contraventions as provided by this Law and committed by the
company, shall be addressed to the legal representative of the company.
Article (373) – Capacity of Judicial Officers
The employees appointed under a Decision by the Minister of Justice in agreement with the
Minister and in coordination with the Authority or the competent authority, as the case may be,
shall have the capacity of Judicial Officers to report any acts in contravention of the provisions
of this Law and the Regulations and Decisions issued in execution thereof, within the scope of
jurisdiction of each of them.
TITLE XII. PROVISIONAL AND FINAL PROVISIONS
Article (374) – Adjustment of Positions
1. Existing companies that the provisions of this Law apply thereto shall adjust their positions
according to the provisions of this Law within no later than one year from the effective date
of this Law. Such term may be extended for another similar term under a Decision by the
Cabinet on a proposal made by the Minister.
2. Subject to the penalties as provided by this Law, if a company fails to comply with the
provision of Clause 1 of this Article, the company shall be deemed as dissolved in
accordance with the provisions of this Law.
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Article (375) – Rules of Motivation of Companies
The Cabinet shall issue the rules necessary for the motivation of the companies to commence
their social liability and the stages of implementation thereof.
Article (376) – Revocation of Contrary Provisions
Any provision contrary to or in conflict with the provisions of this Law is hereby revoked. The
Federal Law No. (8) of 1984 Concerning Commercial Companies and its amending laws are
also hereby repealed.
Article (377) – Issuing Implementing Regulations and Decisions
The Regulations and Decisions issued in implementation of the provisions of the Federal Law
No. (8) of 1984 Concerning Commercial Companies shall continue to be in force to the extent
not in conflict with the provisions of this Law, until such time the Ministry and the Authority,
as applicable, issues the Regulations, Rules and Decisions as required to implement the
provisions of this Law.
Article (378) – Publication and Effective Date
This Law shall be published in the Official Gazette and shall come into force within three
months from the date of such publication.
Issued by us in the presidential palace in Abu Dhabi
On 25 March 2015
Corresponding to 5 Jumada Al Akhira 1436 H
Khalifa Bin Zayed Al Nahyan
President of the United Arab Emirates