The Ministry of Commerce is ur...

The Ministry of Commerce has invited existing companies established "before the implementation of the new company system on January 19, 2023," to initiate the modification of their founding contracts in accordance with the new company system. This can be done through the Business Platform affiliated with the Saudi Center for Economic Business, taking advantage of the current absence of financial fees. The invitation is extended to companies established prior to the system's implementation on January 19, 2023.

The ministry clarified that the modification of the companies' founding contracts is in accordance with Royal Decree No. (M/132) dated 1/12/1443H, stipulating that all existing companies must adjust their status in accordance with the provisions of the new system when it comes into effect on January 19, 2023.

The ministry urged companies to visit the "Business Platform" at business.sa, access the "Modify Founding Contract/Base System" service, choose the modification reason as "Alignment," and submit the application electronically. This allows companies to benefit from the current exemption from publishing fees and take full advantage of electronic services provided by various government entities.

The key advantages of modifying the founding contract include the potential for small and micro-sized companies meeting the criteria to be exempt from appointing auditors according to the system. It also enables the electronic verification of founding contract/base system data by both the public and private sectors. Additionally, companies can modify all current articles of the founding contract/base system by submitting a modification request.

The ministry specified that modification requests should be submitted by partners, managers, or authorized individuals, with the requirement of an extraordinary general assembly resolution for joint-stock and simplified joint-stock companies. The application is to be submitted to the main records of companies only.

The ministry outlined certain situations where modification requests cannot be submitted, such as existing renewal or modification requests for the commercial register under process, existing modification requests for the founding contract of the same company, and when the commercial register status of the company is expired.

Regarding the notable articles subject to modification in the founding contract/base system, it depends on the type of company entity. Some articles may undergo complete or partial modification, while others may remain unchanged. The prominent articles include partners, company name, company purposes, capital, and company management.