Ministry of Commerce and Industry Obliges All Joint-Stock Companies to Disclose any Conflict of Interests of Board Of Directors Members

26 Feb 2012
​The Ministry of Commerce and Industry asked all joint-stock companies to include in a separate item in the agenda of the General Assembly the approval on works and contracts in which a board member has a direct or indirect interest or participates in an activity which may compete with the company's activity or trades in one of the branches of company provided that the Chairman of the Board shall inform the General Assembly during its session about the name of the member who has such dealing and the nature, terms, duration and amount of business – each dealing shall be reported separately. The auditor's report of such dealings and contracts shall be enclosed with the notification(s) as per the two forms (8,9) of the reports forms stated in the standard of (checking affirmations) issued by the Saudi Organization for Certified Public Accounts. It is not sufficient to vote on these transactions within the approval on Board of Directors' report. Yet, voting shall be on each case of interests conflict separately.  All controls and warnings stated in the two articles (69,70) of Companies Act shall be complied with. All company's board members shall be notified about that in writing to work accordingly. To ensure that no conflict of interests between the company and the board member who has an interest in contracts and businesses done for the benefit of the company, the ministry has issued a circular to all joint-stock companies showing  the necessity of complying with all controls and warnings stated in the two articles (69,70) of the Companies Act.
Last Modified 26 Dec 2018