Commercial Companies Law 2001: Contents

Commercial Companies Law 2001
Commercial Companies Law
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Location: Commercial Companies Law 2001 > Commercial Companies Law > Part V — Joint-stock Company > Chapter Two — The Company's Capital
  • Chapter Two — The Company's Capital

    • Article (109)

      The company's capital must be sufficient enough to achieve its objectives, and be denominated in the Bahraini currency. However, subject to the approval of the Minister of Commerce and Industry, the company's capital may be denominated in another currency valued in the Bahraini currency. The capital shall be divided into equal shares and the Executive Regulation shall specify the minimum capital of the company and the nominal value of the share.

    • Article (110)

      The company shall have an issued capital, and the company's articles of association may specify an authorized capital not exceeding ten times the issued capital. The Executive Regulation of this law may specify a minimum issued capital for each activity the company undertakes and the portion paid thereof on the company's incorporation. The issued capital shall be fully subscribed for, and each subscriber shall pay at least one-fourth of the nominal value of cash shares, provided that the remaining amount shall be paid within a period not exceeding five years from the date of the company's incorporation.

    • Article (111)

      Some privileges to certain types of shares with respect to voting, profits, or liquidation proceeds or any other rights may be provided for in the company's articles of association on incorporation, or in a resolution by the numerical majority of the partners representing at least two-thirds of the capital in an extraordinary general assembly meeting upon increasing the company's capital, provided that the shares of the same type shall be equal in respect of the advantages, the rights or the restrictions. The privileges, rights or restrictions pertaining to a specific type of shares shall not be amended unless otherwise decided by the extraordinary general assembly with the approval of the majority of votes referred to above. The Minister of Commerce and Industry shall decree the provisions, requirements and conditions of issuing preferred stocks.

    • Article (112)

      Preferred stocks shall only be issued by the companies whose articles of association provide for the redemption of their shares before the expiry of their term that is linked to a concession to exploit one of natural resources or one of public utilities granted to it for a limited period of time, or to exploit any other non-renewable resource.

    • Article (113)

      The shares shall be issued in its nominal value, but not in a lower value. If they are issued in a higher value, the deference shall be used to pay issue expenses and the remaining amount shall be added to the statutory reserve.

    • Article (114)

      The share shall be indivisible. However, two or more persons may jointly own one share or a number of shares provided that only one person shall represent them before the company. The partners in the same share(s) shall be jointly liable for the obligations resulting from such ownership.

    • Article (115)

      The shares shall be issued in the name of their owners and be negotiable. However, the company may issue bearer shares in accordance with the rules and requirements decreed by the Minister of Commerce and Industry.

    • Article (116)

      i— The shareholder shall pay the value of the shares on the due dates. Interest shall be charged for the delay in payment once the date falls due without the need for serving a notice.
      ii— If a shareholder fails to pay a due installment, the board of directors shall be entitled to sell the share after serving a notice to the defaulting shareholder by registered mail with a delivery note. If the shareholder does not pay the amount within ten days from the date of receiving the notice, the company may sell the share in the Bahrain Stock Exchange or in a public auction. However, the defaulting shareholder may pay the due installment until the date of the auction in addition to the expenses incurred by the company.
      iii— The company shall recover from the proceeds of the sale the delayed installments and expenses and refund to the shareholder any excess amounts. If the proceeds fall short of the company's entitlements the company shall claim the difference by using the ordinary methods.

    • Article (117)

      The first board of directors shall deliver to each shareholder — within three months from the date of the final publication of the company — an interim certificate of the shares he owns. The certificate shall particularly include the name of the shareholder, the number of shares he has subscribed for, the amount paid and the method of payment of its value, the date of payment, the serial number of the interim certificate, the company's capital and its head office.

      The board shall deliver, within three months from the date of payment of the last installment or of full payment of the shares value, a final certificate of the shares with a serial number, signed by two board members and stamped with the company's seal. The certificate shall especially contain the registration number of the company in the Commercial Registry, the authorized, issued and paid up capital and the number of the shares into which the capital is divided, the type and properties of the shares, the company's head office and term, if any. The Minister of Commerce and Industry may exclude all or some of such details. No specific form is required for the certificate so long as it contains the details mentioned above.

    • Article (118)

      The company shall maintain a register to record therein the shareholders' names, their nationalities and domiciles, the number and the serial numbers of the share certificates, and the dealings made thereon. A copy of these details shall be forwarded to the Ministry of Commerce and Industry and the Bahrain Stock Exchange.

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