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Civil Law

Explanation of Article 17

Explanation of Article 17

The article addresses the enumeration of individuals with legal personality, and since the system does not aim to limit them in consideration of developments in the formations of administrative, commercial, and economic establishments, the article states in its final paragraph that everything the system grants this personality is among the individuals with legal personality; to indicate that there is nothing preventing the legislator from later recognizing other forms of legal persons if the interest requires it.

The types of legal personality can be divided into two types, and under each type, there are several individuals with this personality, which are:

  • The first type: persons with a public legal personality, which are entities - including the state - that undertake to achieve interests concerning the entire society or part of it. The criterion for this is the performance of the legal person of all or some of the functions of public authority, and that the state is the one that established it, and it includes the following:

  • First: the state, which refers to the known entity and its branches, such as: regional emirates, governorates, and centers.

  • Second: public bodies, institutions, and interests that are granted legal personality by statutory texts, including ministries, state bodies, public institutions, and interests. It is required that this personality be granted by a statutory text, which means any regulatory tool issued by a competent authority with the power to grant this, and this includes - in addition to the "system" as stated in the Basic Law of Governance - regulations, royal orders, supreme orders, and decisions of the Council of Ministers.

  • The second type: persons with a private legal personality, which includes everything not mentioned in the first section, and includes the following:

  • First: endowments, and jurisprudence and judiciary in the Kingdom have settled on considering the endowment as a person with a legal personality. The system limited itself to referring to two issues in the endowment, the first: the text that it is one of the original real rights in Article 27\50, and the second: that the obligation does not expire except after ten years if it is a revenue that the endowment's supervisor is obliged to pay to the beneficiary according to the text of Article (296), and otherwise, the system referred in Article (698) to the statutory texts related to the endowment, which are concerned with organizing everything related to the endowment of provisions, and in the absence of a text in them; they are subject to the provisions of this system.

  • Second: companies that the system grants legal personality, including commercial companies, and regarding them: "The Companies Law by Royal Decree No. M/132 dated 1/12/1443, and professional companies, regarding them: "The Professional Companies Law by Royal Decree No. M/17 dated 1441/1/26 AH.

  • The article does not include civil companies mentioned in this system, called: jurisprudential companies, and civil companies; the legislator chose not to grant them legal personality, as will be detailed in the explanation of the fourth section of the second part (partnership contracts).

  • Third: charitable and cooperative associations and charitable institutions that the system grants legal personality.

  • Regarding their organization, "The Associations and Charitable Institutions Law" issued by Royal Decree No. 8/M dated 1437/2/19 AH, and "The Cooperative Associations Law" issued by Royal Decree No. 14/M dated 1429/3/10 AH.

  • While the two types of legal personality share some provisions, they differ in some provisions, most notably:

  • First: It is not permissible to seize the funds of the public legal personality, nor to execute on its funds, unlike the private legal personality, where execution on its funds is possible.

  • Second: The rights of the public legal personality do not lapse, unlike the rights of the private personality according to the provisions of the system.

Related To

Article 17

Legal persons are the following:

a) The State.

b)  Public agencies and institutions and entities that are granted legal personality pursuant to legal provisions.

c)   Endowments.

d)  Companies that are granted legal personality pursuant to legal provisions.

e)  Civil and cooperative associations and civil organizations that are granted legal personality pursuant to legal provisions.

f)    Any entity that is granted legal personality pursuant to legal provisions.