Explanation of Article 18
After Article (17) clarified the enumeration of members of the legal entity, this article came to explain the domicile that a legal entity can have, which is known as the statutory domicile; it refers to the main center for managing the affairs of the legal entity.
This domicile is a general domicile for the legal entity and applies to all its affairs; a legal entity cannot have more than one statutory domicile.
If the legal entity has more than one branch, each branch can have its own domicile, provided that this branch engages in independent activity there.
One of the important applications of the domicile of the legal entity concerning legal claims is that they are filed in the court within whose jurisdiction the domicile of the legal entity is located. Also, if it is the defendant, the lawsuit is filed in the court within whose jurisdiction its domicile is located, unless the plaintiff wishes to file it in the domicile of the branch where the subject of the lawsuit is located.
There may be a difference between the main center of the company and its domicile. For example, the parent company is headquartered in America and has a branch in the Kingdom, so its domicile in the Kingdom is the domicile of its branch.
It is worth noting that if the legal entity does not have a main center or does not have actual activity, its domicile is inferred by any evidence, such as the location of its manager, its papers and documents, or the place where its administrative decisions are made, and so on.
Related To
Article 18
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A legal person shall, within the limits prescribed by law, enjoy all rights, except for the rights inherent to a natural person.
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A legal person shall have the following:
a) Independent financial capacity.
b) Legal capacity within the limits specified in the document establishing it or as specified in legal provisions.
c) The right to litigation.
d) An independent domicile. Such domicile shall be the place where its main office is located; however, the place where a legal person’s branch is located may be deemed a domicile thereof with respect to the activity of such branch.
e) A nationality, subject to legal provisions.
- A legal person shall have a representative to express its will.