Adhering to Corporate Law & MCI Instructions is a Must, as stated by the Ministry
MCI has referred a previous Chairman of the Board of Directors of a joint stock company, a liquidator of a general partnership company and a group of officials in two joint stock companies to the Bureau of Investigation and Public Prosecution for taking the necessary legal measures against them, in accordance with Article 229 of the corporate law. This is after detecting some administrative & financial violations, such as not adhering to R&R related to the annual budgets, also lack of commitment to provide the shareholders and partners of the periodic reports about the company`s activities, as well as lack of presenting such reports to the general assembly. This is considered a violation to articles (23), (66), (69), (74), (84), (89) (220) (221) (223).
The Ministry confirmed monitoring and detecting several offenses related to the manipulation of the shareholders` money, who are unaware of the actual financial situation of the companies, along with the lack of responding to the Ministry`s correspondence. Meanwhile, MCI would like to stress that all corporate officials should adhere and comply with the provisions of the Corporate Law, and to respond immediately to all MCI correspondence, so as to avoid the penalties provided for by the law.
This comes within MCI plan and strategy to control the offending companies and to take the necessary measures to protect the investors' money in accordance with the Royal Order No. (4690) dated 06/02/1435 H, included the transfer of entities and committees competences, related to investigation and prosecution of criminal offenses, to the Bureau of Investigation and Public Prosecution. This comes within the Ministry's keenness and on-going pursuit to protect the shareholders and to preserve their rights, and as part of the Ministry`s supervisory and monitoring responsibilities on companies in the kingdom.
MCI would like to reconfirm the need for fair practices of business, and the necessity for applying the standards and provisions of transparency and disclosure in accordance with the basic principles of Corporate Law in the Kingdom, which aims to sustain and develop the economic entities. MCI is doing its best to protect and preserve the rights of all parties, especially those dealing with companies.