OMAN CHAMBER OF COMMERCE AND INDUSTRY …

1 OMAN CHAMBER OF COMMERCE AND INDUSTRYTHE commercial companies LAWNo. 4/1974 Amended by Royal DecreesNos. 53/1982, 13/1989, 83/1994 & 16/1996 First EditionMay 1997 commercial companies LAWPART ONECOMMERCIAL companies IN GENERALC hapter OneGeneral ProvisionsArticle 1A commercial Company is a contract by which two or morepersons undertake to participate in an enterprise for profit, eachcontributing a share of the Capital in the form of tangible orintangible property or services, with a view to sharing any profit orloss resulting form the 2 (*)This law shall govern the following types of companies .

2 A) General Partnerships b) Limited Partnerships c) Joint Ventures d) Joint-stock companies e) Limited Liabilities companies f) Holding CompaniesSubject to the transitional and final provisions provided in part 9of this Law, any Company which does not adopt one of the typeslisted above shall be null and void, and the persons who have actedin such Company s name shall be jointly and severally liable for theobligations resulting from such 3 All commercial companies , except joint ventures, shall beconsidered juristic 4 All contracts, receipts, notices and other documents issued byCommercial companies shall indicate the Company s name, itsform.

3 Its principal place of business and the number and place ofits registration in the commercial Register. The provisions of thisarticle shall not apply to the joint ventures.(*) Amended by Royal Decree No. 83/1994 Article 5No commercial Company other than the Joint-stock Companymay have as its object the conduct of insurance business,solicitation of savings or capital from the public, investment offunds of the account of third parties, conduct of banking businessor the provision of commercial air transport 6 The Memorandum and Articles of Association of CommercialCompanies other than those related to joint ventures shall bepublic documents which shall be registered and publishedpursuant to the provisions of this law and the commercial RegisterLaw.

4 Any person who becomes a partner of a CommercialCompany shall be subject to the provisions of the Memorandum ofAssociation and Articles of Association thereof. The existence of aCommercial Company shall not be asserted by third parties in goodfaith until such time as registration and publication procedures arecomplete according to the provisions of the commercial RegisterLaw. Nevertheless, third parties in good faith may assert theexistence of the Company in claims placed against partners thereofeven though such registration and publication procedures are 7 (*)

5 commercial companies with non-Omani partners, whether suchpartners are natural or juristic persons shall comply with theforeign capital investment 8 Partners of a commercial Company shall not, without the priorconsent of all partners, conduct any business similar to thebusiness of the Company for their own account or for the accountof third parties, provided, however, that this restriction shall notapply to partners of joint ventures or shareholders of , Managers and Directors of a commercial Company shallnot, without the prior consent of all the partners or without theconsent of the general meeting, in the case of Joint-stockCompanies, use the Company s assets or properties for theirbenefit or for the benefit of third parties, or enter, directly orindirectly, into any agreement with the Company for their account,except for the ordinary contracts of the type(*) Foreign Capital Investment Law, issued by Royal Decree No.

6 102/1994and cancelled Foreign Business & Investment the Company concludes with its customers within theoridinary course of its , Managers and Directors of a commercial Company whoviolate the provisions of this Article shall be liable to the Companyfor the profits they have gained from such violation and for thedamages arising thereof. A remedial action may be filed by anyinterested party, and all transactions to which the Company is aparty and which infringe the provisions of the preceding paragraphshall be 9 Personal creditors of a partner of a commercial Company shall notclaim the payment of their debt out of such partner s share in thecapital of the Company.

7 However, they may claim on thedissolution of the Company, the payment of their debt out of thepartner s share in the remaining assets of the Company after thesettlement of the Company s creditors of a partner of a commercial Company otherthan the Joint-stock Company may claim the payment of their debtout of such partner s share in the Company s profits as determinedin the Company s profit and loss statement. As for the Joint-stockCompany, payment may be claimed only out of the partner s sharein the declared creditors of a shareholder in a Joint-stock Company may,besides the rights provided in the two preceding paragraphs, claimthe public sale of the indebted shareholder s shares to recover theirdebt out of the proceeds.

8 Subject to the provisions of the applicablelaws and the Company s Articles of 10No case shall be filed for claims arising under the provisions of thisLaw against or among partners of commercial Companiesregarding the Company s Memorandum or Articles of Associationor the Company s acts, or against the Company s Managers,Directors, Auditors or Liquidators, or against the heirs orsuccessors of any of them for the acts they performed during theexercise of their functions, unless such case is filed within a periodof five years from the most recent of the following dates: a) The date of the act or omission forming the basic of case.

9 B) The date of the General Meeting at which the Board ofDirectors gave an account of the Company s operations forthe period that includes the act or the omission forming thebasis of the case filed against the Directors of a Joint-stockCompany. c) The date of the partner s meeting at which the Managersgave an account of the Company s operations for the periodwhich includes the act or omission forming the basis of thecase filed against the Managers of a Limited LiabilityCompany. d) The date on which the general partners of a limitedpartnership gave the limited partners an account of theCompany s operations for the period which includes the actor omission forming the basis of the case filed against thegeneral partners of a limited TwoContribution to Capital and Division of Profit & LossesArticle 11 (*)

10 The contribution of partners to the capital of a CommercialCompany may consist of money or may be a contribution in kindconsisting of real or personal property, or intangible propertyrights or the services of one or more partners subject to the specialprovisions governing each form of value of all contributions to the capital of the Company shallbe stated in the Memorandum and Articles of Association of theCommercial Company in terms of the Authority for the Settlement of commercial Disputes, upon acomplaint by a partner or a creditor of the Company finds that apartner s contribution in kind has been overvalued, the partnershall then pay to the Company, in cash, the differences between theestimated value of the property contributed by such partner and itstrue value as at the time of contribution.