10 July 2008
RIYADH - The Ministry of Social Affairs started implementing Wednesday the new regulations for cooperative society issued by a Royal decree earlier this year.
A cooperative society will have individuals and legal personalities of at least 12 members. In exceptional cases approved by the Minister of Social Affairs a society can have five members.
Members should be Saudis, at least 18 years of age, should have paid their share in the society, be residents or have interests in the area where the society will provide its services, not carry out any activity conflicting with the interest of the society, should be accepted by the board of directors of the society.
However, there will be exceptions in case of inheritance.
Founders of a cooperative society will bear the basic expenses and fulfill other commitments.
Every society will have a basic statute and executive regulations.
The share prices will be constant and would not be divisible. However, it can add membership fees and expenses for issuance of the share. Members can own a maximum of 10 percent of the society's capital in shares. However, there will be exception.
The founders will prepare a preliminary contract and the basic statute for the society after coordination with the competent supervisory body in the Ministry of Social Affairs.
The founding contract must include the society's name, type, purposes, headquarters, area of work, name of founders, place of establishment, names of founders, their places of residence, profession, places of birth, national ID card numbers, capital subscribed to, the nominal value of each share, date and place of signing the contract.
Founding members must submit an application to the ministry for the society's registration by attaching the necessary documents.
They should also submit economic feasibility report.
The ministry will issue a preliminary approval after consultation with competent authorities.
After the preliminary approval and the submission of economic feasibility report, founding members will be authorized to collect the capital and submit the bank receipt to the ministry.
Once the society gets the ministry approval, it will have privileges granted to societies formed according to the regulations.
Except for societies whose activities are confined to the Kingdom, they will be allowed to have branches outside conditionally.
RIYADH - The Ministry of Social Affairs started implementing Wednesday the new regulations for cooperative society issued by a Royal decree earlier this year.
A cooperative society will have individuals and legal personalities of at least 12 members. In exceptional cases approved by the Minister of Social Affairs a society can have five members.
Members should be Saudis, at least 18 years of age, should have paid their share in the society, be residents or have interests in the area where the society will provide its services, not carry out any activity conflicting with the interest of the society, should be accepted by the board of directors of the society.
However, there will be exceptions in case of inheritance.
Founders of a cooperative society will bear the basic expenses and fulfill other commitments.
Every society will have a basic statute and executive regulations.
The share prices will be constant and would not be divisible. However, it can add membership fees and expenses for issuance of the share. Members can own a maximum of 10 percent of the society's capital in shares. However, there will be exception.
The founders will prepare a preliminary contract and the basic statute for the society after coordination with the competent supervisory body in the Ministry of Social Affairs.
The founding contract must include the society's name, type, purposes, headquarters, area of work, name of founders, place of establishment, names of founders, their places of residence, profession, places of birth, national ID card numbers, capital subscribed to, the nominal value of each share, date and place of signing the contract.
Founding members must submit an application to the ministry for the society's registration by attaching the necessary documents.
They should also submit economic feasibility report.
The ministry will issue a preliminary approval after consultation with competent authorities.
After the preliminary approval and the submission of economic feasibility report, founding members will be authorized to collect the capital and submit the bank receipt to the ministry.
Once the society gets the ministry approval, it will have privileges granted to societies formed according to the regulations.
Except for societies whose activities are confined to the Kingdom, they will be allowed to have branches outside conditionally.
© The Saudi Gazette 2008
