The bond holders of each issue shall constitute, by virtue of the law, a legal body. The resolutions legally adopted by such body in a general meeting of bond hoders, shall be binding on all the bond holders of the said issue. The bond holders general meeting shall be convened by means of a notice published in, at least, two daily newspaper on two consecutive days and shall also be sent to nominal bonds holders fifteen days, at least, prior to the date specified for the meeting and the invitation shall not be valid unless it includes the agenda of the meeting The resolutions of the bond holders general meeting shall not be valid unless such meeting is attended by, personally or by proxy, a number of bond holders representing at least two - thirds of the bonds of a certain issue. Failing such quorum, a second meeting shall be convened to discuss the same agenda. The date of the second meeting shall be notified to the bond holders in the same manner followed with regard to the first meeting, one week, at least, prior to the date set for the second meeting. A quorum representing one - third of the bonds shall be suHicient for the second meeting provided the second meeting is held within one month from the date of the first meeting. Ho~ever, a resolution to extend the redemption period of the bonds or reduce the rate of interest or the principal debt or the secunties or in way prejudice the rights of the bond holders, shall not be adopted unless the meeting IS attended by bond holders who represent two-third of the bonds Resolutions shall be adopted by two-thirds majority of the bonds represented at the meeting. The bond holders will have an agent appointed by the bond issuing company as per the regulations stipulated by the resolution of the Minister of Commerce and Industry, provided that the agent should be one of the companies working in the field of securities and the appointment to be done after the necessary approval from the Capi- tal Market Authority.
Transcript
The bond holders of each issue shall constitute, by virtue of thelaw, a legal body. The resolutions legally adopted by such bodyin a general meeting of bond hoders, shall be binding on all thebond holders of the said issue.
The bond holders general meeting shall be convened by meansof a notice published in, at least, two daily newspaper on twoconsecutive days and shall also be sent to nominal bondsholders fifteen days, at least, prior to the date specified for themeeting and the invitation shall not be valid unless it includesthe agenda of the meeting
The resolutions of the bond holders general meeting shall not bevalid unless such meeting is attended by, personally or by proxy,a number of bond holders representing at least two - thirds ofthe bonds of a certain issue. Failing such quorum, a secondmeeting shall be convened to discuss the same agenda. Thedate of the second meeting shall be notified to the bond holdersin the same manner followed with regard to the first meeting,one week, at least, prior to the date set for the second meeting.A quorum representing one - third of the bonds shall besuHicient for the second meeting provided the second meetingis held within one month from the date of the first meeting.Ho~ever, a resolution to extend the redemption period of thebonds or reduce the rate of interest or the principal debt or thesecunties or in way prejudice the rights of the bond holders,shall not be adopted unless the meeting IS attended by bondholders who represent two-third of the bonds
Resolutions shall be adopted by two-thirds majority of thebonds represented at the meeting.
The bond holders will have an agent appointed by the bond issuing
company as per the regulations stipulated by the resolution of the
Minister of Commerce and Industry, provided that the agent shouldbe one of the companies working in the field of securities and theappointment to be done after the necessary approval from the Capi-
tal Market Authority.
The bond issuing company shall send to the bond holder's agentthe same invitations that they sent to the shareholders to attend thegeneral meetings. The agent shall attend 'Such meetings andparticipate in the discussions of the meeting. However the agentwill not have the right to vote with regard to the decisions issued.
CHAPTER THREEMANAGEMENT OF THE JOINT STOCK COMPANY
DIVISION ONEBOARD OF DIRECTORS
The management of the joint stock company shall be entrustedto a Board of Directors the number of whose members and termof office shall be provided by the company's articles of association.The members of the Board of Directors shall not be less thanthree for the closed joint stock companies, and five for the publicjoint stock companies. In both cases the number shall not exceedtwelve members. The member's term of office shall not exceedthree years subject to re-election more than once
The period mentioned in the above paragraph wiil be calculated fromthe date of general meeting, in which the election was carried out,to the date of holding next third annual meeting In case the date ofholding general meeting exceeds the above mentioned three years,the term of membership will be extended up to the holding of themeeting, provided that this period should not exceed the end ofspecified period to hold ordinary annual general meeting mentionedin the article (120)No one shall be a member or rep,esentative of-a JUdicial personIn the Board or Directors of more than four publicly held joint-stockcompanies having their principle place of business in the Sulta-nate of Oman or be chairman of more than two of these compa-nies or combine the membership in the board of directors of apublic joint-stock company and another- closed joint-stock com-pany practicing similar activities and having their principal placeof business in Oman.
-:-----' No person, also, shall become a member of the Board of Directorsof a company if he has been convicted in Oman or abroad, ofoffence uniting moral turpitude unless he is rehabilated.
Article (96): The ordinary general meeting shall elect the members of theBoard of Directors pursuant to the provIsions of the law and thecompany's articles of association
Article (97) : Members of the Board of Directors shall be elected either fromamong the shareholders or others, provided that the candidate,if he was a shareholder, holds the minimum number of sharesspecified by the coompany's articles of association. The Ministerof Commerce and Industry shall issue a decision stipulating therules and conditionsfor electingthe boardmembersor the representativesof the judicial persons and the provisions of their responsibilities.
~.rtjcle (98): If the oHlce 01a.dire.:tor becomes vacant in the penod betweentwo ordinary general assemblies, the Board, unless the articles01 association provides otherwise, may appoint a temporarydirector who meets the reqUirements provided by the articles 01association and the preceding article to assume his 011Ice untilthe next ordinary general meeting.
If at any time more than hall of the number of director aretemporary directors appointed by the Board under thepreceding paragraph, the Board 01 Directors shall call, withintwo months, an ordinary general meeting lor the purpose 01electing directors in accordance with the company's articles ofassociation to replace the directors who were so elected but areno longer in office.
Directors elected by the ordinary general meeting to fillvacancies in the Board of Directors shall serve for theremaining period of their predecessors In oHice unless thecompany's articles of association provides otherwise.
Article (99) : The general meeting may, at any time and without anyjustification, remove any or all of the members of the Board ofDirectors even if the company's articles of association providesotherwise.
Article (100) : Immediately following the election of a new BOard of Directorsby the ordinary general meeting, the said Board shall meet toelect one of its members as chairman whose term of office shallnot exceed his term of office as a member of the Board ofDirectors, though he may be re-elected. Subsequent meetings?f the Board of Directors may be convened by the chairman attInY-- time, and the chairman shall convene a meeting uponrequest made by two or more members of the Board ofDirectors. If the chairman finds it difficult to respond to suchrequest, or it he does not wish to do so, any two members ofthe Board ot Directors may convene the meating.
The meeting of the Board of Directors shall not be valid unless Itis attended by, at least, half the members of their representatives.
The company's articles of association may provide a higher ratioor number and they may, as well, provide a special Quorum forthe meetings of the Board. The Board makes its decisions by
the relative majority of the present members unless thecompany's articles of association provides otherwise. In thecase of a tie vote, the chairman shall have a casting vote.A JUristiC person represented by a member of the Board ofDirectors may delegate another person of Its subordinates toattend any meeting and vote on Its behalf.
A member of the Board of Directors may delegate anothermember of the Board. however no one member of the Boardshall act on behalf of more than one member, and In any casethe delegation shall be exclusive and written
Article (101) The General meeting shall determine the annual remunerations andthe allowance of attending the company's board and other sub-committee meetings, the total of which should not exceed 5% ofthe annual net profit, a maximum of Rials Omani two hundred thou-sand. The allowance of attending meetings for each members shouldnot exceed Rials Omani ten thousand per year after the deductionof the legal and optional reserves according to the article (106) ofThe law and distributing or keeping away the dividends to the share-holders at a rate not less than 5% of the capital unless thecompany's articles of association provides a higher rate
The percentage of remunerations and allowances of attending meet-ings will be determined as per the regulations stipulated by theresolution of the Capital Market Authority, in case the company isnot realizing any profit or realizing a profit which is not sufficient fordistributing or keeping away the full divfdend of shareholders alongwith the allowances.
The company is allowed, in the event of loss to its capital, to grantits members the allowances of attending board meetings of theyear or the following year of loss. This will be paid within the limitas per the rules stipulated by the resolution from the authority.
Dividends shall be formed of the net profits minus the losesincurred by the capital of the company in previous years whichhave been fully amortised,
The report of the Board of Directors to the ordinary generalmeeting shall Inclue a comprehensive statement on all amountsand other benefits received by each member from the companyduring the year as compensation for his services, Including allamounts paid to the member in their capacity as employees ofthe company
Article (102): The Board of Directors shall have full authOrity to perlorm all
acts reqUired for the management of the company In the courseof achieVing Its objective and implementing the resolutions ofthe general meeting. Such authOrity shall not be limited orrestricted except to the extent provided In the law or In thecompany's articles of association.
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The Board of Directors shall not, however, per10rm the followingacts unless expressly authorized to do so by the company'sarticles of association or by a resolution of the general meeting:
A, Donations, except donations required by the businesswherever they are small and customary amounts.
B' To sell all or a substantial part of the company's assets.
C, Pledge or mortage the assets of the company, except tosecure debts of the company incurred in the ordinarycourse of the company's business.
D· Guarantee debts of third parties, except guarantees madein the ordinary course of business for the sake ofachievement of the company's objectives
The Board of Directors may, by majority consent of its all members
and within the limits assigned to it, delegate some of its powers
to committees formed from among its members.
Article (103): The chairman of the Board of Directors shall implement theresolution of the Board of Directors and shall conduct the regularbusiness of the company under the supervision and control ofthe Board of Directors.
The articles of association of the company may include aprovision that authorizes the Board of Directors to elect adeputy chairman who shall act as chairman In the absence ofthe chairman, and a managing director or more who shall have
the authority of signing in the name of the company jointly or individuallyas the Board may determine. The names and signatory powers
- ',:-'-ef the chairman, deputy chairman and managing directors, ifany, shall be registered in the Commercial Register.
The Board of Directors shall form a auditing committee fromamong its members and appoint an internal auditor and a legaladvisor pursuant to the controls issued by the Capital MarketAuthority. While appointing the members of the auditing com·mittee, the provisions of the responsibility as stipulated in Article109 of this law shall be applied without prejudicing their responsibilitiesassigned to them as members of the board of the directors.
Article (104): The company's Articles of Association shall specify the beginningand end of the Company'sfinancialyear If the companywas incorporatedin the first half of the year, the first financial year shall end at theend of the same year, and if incorporated in the second half, the
first financial year shall end at the end of the next year
The joint stock company shall be bound by all acts performedby its Board of Directors, its chairman, managing directors andall other executives, if any as long as they act In the name ofthe company and within the scope of their powers. Any thirdparty in good faith shall have the right to assume that any actdone by the Board of Directors, chairman and the managing directorsof the company in pursuance of its business is within scope ofpower delegated to such persons and the company shall bebound thereby, unless the limitation of such person's authority isregistered in the Commercial Register.
Article (104)(1) Public joint stock companies shall prepare half-yearly unauditedaccounts which include the balance sheet, profit and loss accountand cash flow statement, provided such accounts are publishedwithin three months from the end of half the company's financialyear in two daily newspapers.
Article (105) Within two months from the end of the financial year, the
Board of Directors shall prepare the balance sheet of the company
and a statement containing the Company's profit and loss account
after they have been audited by the company's auditors. The
statement shall also prepare a report on the company's operations
during the expired year and on the net profits proposed to be
distributed. Copies of all the above mentioned statements shallbe sent to the Capital Market Authority and the Commercial
Registry two weeks,at least, prior to the meeting of the ordinaryannual general meeting. A copy of the balance sheet, the report
of the Board of Directors and the report of the auditors shall,
likewise, be sent to each shareholder together with the invitatior,
to attend the meeting of the ordinary annual general meeling.
and the report of the auditors shall, likewise, be sent to eachshareholder together with the invitation to attend the meeting ofthe ordinary annual general meeting.
~r1icle(106): The Board of Directors shall deduct 10% of the company's netprofits after the deduction of taxes as a legal reserve for eachfinancial year until such legal reserve amounts to, at least.one-third of the company's capital. The legal reserve shall notbe distributed to shareholders as dividends.
The ordinary general meeting may decide the establishment ofoptional reserve accounts which shall not exceed 20% of thenet profits for that year after deduction of taxes and the legalreserve, provided that total amount deducted as an optionalreserve shall not exceed half the capital of the company exceptin the case of banks and insurance companies.
: A member of ·the Board of Directors shall not participate in themanagement of a business competitive with that of thecompany except by approval of the general meeting. providedsuch approval shall be renewed annually.
Likewise, a member of the Board of Directors or any of the keystaff of 1he company shall not utilize the information accessibleto him by virtue of his position for the achievement of a benelltfor himself or for his minor children or for any of his immediaterelatives up to the fourth degree as a result of dealing in thecompany's securities. No one of such persons shall have anyinterest, directly or indirectly, with any body involved in activitiesintended to affect the prices of the securities issued by thecompany. In the event of infringement of the above, theprovisions of Articles 109 and 110 of the law shall apply.
A member of the Board of Directors or any other party related to thecompany shall not have any direct or indirect interest in the trans-actions or contracts of its account As an exemption from suchrestriction, it is allowed to made some transactions and contractsas per the regulations stipulated by the resolution of the CapitalMarket Authority. The resolution explains the meaning of relatedparties and rules of announcing the transactions and contracts
Article (109) : The members of the Board of Directors shall be liable to the
company, the shareholders and third parties for the damagescaused by their acts in violation of the law and their acts whichfall beyond the scope of their powers or by any fraud or
negligence in the performance of their duties or by their failure
to act as prudent men under certain circumstances.
If there are more than one director liable under the preceding
paragraph, the Authority for the Settlement of Commercial
Disputes may hold each such director liable for all or part of the
damages as the Authority may deem proper inview of the
circumstances of the case
Shall be null and void any provisions or stipulations limiting theliability of the members of the Board of Directors, and the
company shall reimburse any director the costs and sums
adjudged in any civil or criminal case brought against him as a
result of his activities as a member of the Board of Directors of
the company in the event that final judgement in such case
shall absolve the director of liability.
Article (110): The company may institute an action against any d',rector of the
company it deems liable for damages that have come upon it
under the provisions of the preceding Article. The Board of
Directors or the ordinary general meeting shall take a decision
appointing a person to pursue the case on bahalf of the
company and authorizing him to pay the costs of tile case from
the funds of the company. However, if the company is under
liquidation, the decision to file the case shall rest with the
liquidator of the company.
Any shareholder may propose suing the members of the Boardof Directors, and if the ordinary general meetin'g does not adopthis proposal, he may himself file the case on behalf of thecompany. And if the case is successful, such shareholder shallbe reimbursed the costs and expenses of thE! case out of thesums adjudged and the balance shall be paid to the company.
DIVISION TWOAUDITORS
Artlcl. (111): The joint stock company shall have, at least, one auditor from thelicensed persons to practice accountancy and auditing works, whoshall be appointed by the ordinary general meeting. The authorityshall stipulate regulations to appoint auditors in the joint stock com-pany, they have the right to object the appointment of general bodiesof this company vide a resolution of effect within 15 days from thedate of submitting the minutes of general meeting tc?the authority.In all cases, the auditors shall be independent from the company,hence, they shall not be promoters or directors or employees of thecompany or its affiliates. Such auditors shall not provide, regularly,the company or its affiliates with technical or administrative or con-sultative services.The Auditors shall undertake their duties from the date of their ap-pointment till the holding of next annual general meeting from thedate. The company may reappoint them considering the issuedregulations as per the second paragraph. The auditors shall ad-here to the rules and regulations issued by the authority with re-gard to the joint stock company as per the provisions of this law.
Article (112): The auditors shall have the right, at any time, to examine allbooks, records and documents of the company and obtain allinformation they deem necessary for the proper performance oftheir duties.
The auditors shall ascertain that the balance sheet and profitand loss statement conform with the bo~s and records of thecompany and that such books and records are kept inconformity with the generally accepted principles of accounting.
Article (113): The auditors shall make a report to the annual general meeting~:m the financial position of the company and the proposed _distribution of dividends, including their opinion as to whether .:---.-.the balance sheet and the profit and loss account presented tothe meeting reflect the true financial position of the companyaccording to the generally accepted accounting principles. Anychange made in the accounting principles adopted in thepreparation of the balance sheet and profit and loss accountsince the preceding financial year, shall be clearly mentioned inthe auditor's report.
If the auditor's report is not presented to the general meetingand, if it does not conform to the requirements of the precedingparagraph, then the resolution of the annual meeting approvingthe accounts presented to the meeting shall be void.
The auditor who in the performance of his functions ascertainsthe existence of a violation of the law or the company's article ofassociation, shall report such violation to the management ofthe company through the concerned auditor and. in the event ofa serious violation, he shall report it to the general meeting.
Article (114): Auditors shall be liable towards the company, shareholders andthird parties for damages arising from any fraud in theperformance of their duties. They shall be liable to the companyand shareholders for the damages arising from failure inperforming their professional and technical duties withefficiency.
DIVISION THREEGENERAL MEETINGS
Article (115): Each shareholder shall have the right to attend general meetingand shall have· one vote against each share held by him, even ifsuch share is represented by a provisional certificate.
A shareholder may give a written proxy to another person to attendthe general meeting and vote on its resolutions. The shareholdermay revoke such proxy at any time. The representative neednot be a shareholder unless the company's articles of associa-tion so ordains.
Article (116) The Board of Directors may convene the general meeting atany time and such meeting shall be convened whenever requiredby the law or the company's articles of association, or upon requestof one or more shareholders who represent at least twenty - fivepercent of the capital of the company.
If the Board of Directors fails to convene the General Meeting'smeeting, then the auditors shall do so. Notice to attend a meetingof the General Meeting shall not be valid unless it includes theagenda, and such notice shall be published, after its attestationby the Capital Market Authority or the Ministry of Commerceand Industry, as the case may be, in two daily newspapers andfor two consecutive days, at least. At the same time, a copy ofthe notice shall be sent to each shareholder by ·ordinary mailor delivered by hand to him or to his representative against signatureat least two weeks before the date specified for the meeting.
The Capital Authority shall be notified of the date of the GepeJ_alMeeting of the public joint-stock companies and the Ministry ofCommerce and Industry shall be notified of the date of the GeneralMeetings of the closed joint-stock companies. Either .of theseentities shall delegate an observer to attend the meeting andsupervise its proceedings and to ensure that the resolutionsadopted are in accodance with the law. The minutes of the generalmeetings shall be deposited with both the entities, signed by thesecretary and approved by the chairman of the meeting and theauditors, within 15 days from the date of convening the meeting.
Article (117) : The Board of Directors shall establish the agenda of the generalmeeting; If the meeting is con:-,enedby the auditors, the agendashalthen be established by \hem. The Board. or the auditors, ifnecessary shall inclue in the agenda any proposal put forwardby shareholders who represent more than ten per cent of thecapital of the company provided that such proposal is submittedfor inclusion in the agenda at least one mont before the date ofthe meeting.
The general meeting shall consider only the matters included inthe agenda. However, in exceptional cases, the general meetingmay consider an urgent and unexpected matter which ansesduring the meeting subject to a resolution adopted by the generalmeeting by relative majority of the votes of the present members.
Article (118): The shareholders and proxies representing all the shares of thecompany may hold a general meeting without regard to therules stipulated for such meeting. The meeting so held maydeliberate on all matters which are within the authority of thegeneral meeting to decide.
Article (119): The ordinary general meeting may consider and decide allmatters which are not, by law or by the company's articles ofassociation, reserved for decision by the Board of Directors orby an extraordinary generai meeting.
Article (120): The annual general meeting shall be held each year within threemonths of the end of the company's financial year. Otherordinary general meetings shall be held when required by lawor the company's articles of association or when need arises tohold such meetings. The agenda of the annual general meetingshall include:
A· StUdy and approval of the Board of Directors report.
B· Study of the auditor's report and approval of the balancesheet and profit and loss account.
C· Declaration of dividends, provided the dividends shall bedeclared only out of the net profit or out of the optionalreserve subject to the provisions of Article (106).
D· Declaration 0' members 0' the Board of Directors i' theoffice term of one, or all 0' them has expired or any of theposts becomes vacant.
E· Appointment of auditors for the financial year withoutprejudice to the State's Audit law.
Artlck: (121): The company's balance sheet. profit and loss account, and thereports of the Board 0' Directors and auditors of the companyconcerning the expired financial year shall be available forinspection by the shareholders and bond holders of thecompany during business hours at the. company's principalplace ot business during a period 0' at least two weeksimmediat~ly preceding the date of the ordinary annual generalmeeting. If any shareholder Is deprived of his right to inspectthese documents, the decision approving these documentsshall be null and void.
The Board 0' Directors shall publish the balance sheet, the profitand loss account and a summary of the report of the Board in alocal daily newspaper within one month of the ordinary annualgeneral meeting's approval of the said documents.
Article (121) (2): The jointstock company shall deposit the amount, which was notreceived by its beneficiaries from the share holders, at theCapital Market Authority after six months from the due date asper pro~edures that will be issued by a resolution from the boardof authority. These companies should advertise the same twicein the daily newspaper within a maximum period of 14 days fromthe date of deposit.The authority shall advertise the dues deposited with It as perthe mode and time specified by Its board.
Article (122) : The resolutions 0' the ordinary general meeting shall be voidunless the meeting is attended by shareholders 0' their proxieswho represent, at least. half the capital of the compan~J.f sucha quorum is not formed, a second meeting shall ~ ··citled todiscuss the same agenda. The second ordinary generalmeeting shall be notified to shareholders In the same manneras the first meeting, at least one week prior to the date set 'orthe second meeting. The resolutions of the meeting shall bevalid regardless of the number of shares represented, providedthat such meeting is hald wilhin one month for the date of thefirst meeting.The resolutions of Ihe ordinary general meeling shall beadopted by relative majority ot the votes.
AnIc~ (123): The extraordinary general meeting shall be convened toconsider and decide all matters which such meeting isspecifically authorized to settle in accordance with the law orthe company's articles of association.
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The extraordinary general meeting may decide to amend thecompany's article of association; however such amendmentshall not be valid unless approved by the Director General ofCommerce and registered in the Commercial Register.
Article (124) : The resolution of the extraordinary general meeting shall not bevalid unless the meeting is attended by shareholders andproxies representing at least three - quarters of the company'scapital. Failing such quorum, a second meeting shall beconvened to discuss the same agenda. The shareholders shallbe notified of the second extraordinary general meeting in thesame manner as the first extraordinary gEneral meeting, atleast two weeks prior to the date set for the second meeting.The resolutions of the second meeting shall be valid if themeeting is attended by shareholders or proxies representingmore than half of the company's capital, provided such meetingis held within six weeks of the date of the first meeting.
The resolutions of the extraordinary general meeting shall beadopted by a majority of three - quarters of the votes cast inrespect of a certain resolution, provided such resolution shallalways receive votes representing more than lifty per cent ofthe company's capital
If the resolution is for the purpose of transforming a closed jointstock company into a general or limited partnership company,then such resolution shall be unanimously adopted by theshareholders
Article (125): The general meetings shall be presided over by the chairman ofthe board and in his absence, the meeting shall be chaired buyhis deputy elected pursuant to the provisions of Article 103 ofthis law. If the general meeting was convened by the auditorspursuant to Article 116, they shall appoint the chairman of themeeting and the general meeting shall appGint a secretary whoshall prepare the minutes of the meeting that shall iroclude thedeliberationsmade during the meeting and the resolutionsproposedand the voting made on them. Every shareholder or bondholdershall have the right to inspect this minutes kept at the company'shead ofiice premises.
Article (126): The resolutions of the general meeting dUly adopted pursuantto the provisions of the law and the company's articles ofassociation or its regulations, if any, shall be binding to thecompany and each of its shareholders; but shall not affect therights of third parties except to the extent provided by this lawo
Any shareholder or any other interested person may, within fiveyears from the date of the general meeting, apply to theAuthority for the Settlement of Commercial Disputes to decidethe annulment of any resolution if adopted by such generalmeeting in violation of the law or the provisions of thecompany's articles of association or its regulations, if any, or °Ifadopted by fraud or abuse of authority by any person.
CHAPTER FOURHOLDING COMPANIES
Article (127): The holding compny is a joint stock company or a limited liabilitycompany which financially and administratively controls one ormore other companies which become subsidiary to suchcompany by means of its holding at least 51% of such companyor companies whether they are joint stock or limited liabilitycompanies. The term "holding" shall be added to the title of suchcompany in all its papers, advertisements ad other documentsissued thereby. The capital of a holding company shall not beless than two million Omani Rials and a holding company shallneither hold shares of general or limited partnership companiesnor shall it hold any shares in other holding companies.
The objectives of the holding company shall be as follows:
- To manage its subsidiary companies or to participate in themanagement of other companies in which it holds shares.
- To invest its funds in share, bonds and securities.
- To provide loans, security and finance to its subsidiaries.
- To own patents, trade marks, concessions and otherincorporal rights, utilize them and lease them to its subsidiariesand other companies.
The holding company shall be established by either of thefollowing means:
A· Establishing a joint stock comparw or a limited liability - >----company whose objectives shall combine one or more ofthe objectives provided in the preceding paragraph and inestablishing subsidiary companies or in acquiring sharesand stocks in joint stock or limited liability companies tocarry out such objectives.
B· Amending the objectives of an existing joint stock companyor a limited liability company to a holding company inaccordance of the law.
The Minister of Commerce and Industry shall specify theorganizational provisions of the holding companies and theirsubsidiaries. and he shall arrange the balance sheet and profitand Joss account of the subsidiary companies In a unifiedsystem.
Article (128): The Board of Directors of the holding company may invite thechairman of any subsidiary company to attend the meetings ofthe Board of Directors of the holding company when mattersrelated to the subsidiary company are being considered by suchmeetings so that he may make remarks, express his opinions orgive explanations or statements about certain issues. Suchchairman shall have the right to participate in discussions buthis vote shall not count.
CHAPTER FIVEDISSOLUTION AND LIQUIDATION OF THE
JOINT STOCK COMPANY
Article (129): The joint stock company shall be dissolved for any of thereasons for dissolution provided in the company's articles ofassociation or in Article (14) of this law. The ordinary generalmeeting m,ayresolve the dissolution of the company at any time.
If the company has lost three . quarters of its capital, thechairman of the Board of Directors shall convene anextraordinary general meeting to decide whether the companyshall be dissolved or its capital be reduced or some otherappropriate measures shall be taken. If the chairman fails toconvene the ex1raordinary general meeting, or if the meetingcannot be held due to lack of quorum, or if it has been decidednot to dissolve the company without taking any appropriatemeasures, then each shareholder or creditor of the companyshall have the right to apply to the Authority for the Set1lementof Commercial Disputes to decide the dissolution of thecompany.
Article (130): After its dissolution, the joint stock company shall be liquidatedpursuant to the law and the provisions of its articles ofassociation, provided that such provisions shall not violate anymandatory legal provisions.
CHAPTER SIXPARTICIPATION OF THE SULTANATE and
OMANI PUBLIC ESTABLISHMENTS
Article (131): The joint stock companies in which the Sultanate or any OmanipUblic establishment contributes shall be sUbject to allprovisions of this law concerning the joint stock companieswhich are not contradictory to the following articles.
Article (132): The share of the Sultanate or any of its administrative unitsshall be represented in the company's Board of Directors byone or more members who shall be appointed by virtue of aRoyal Decree pursuant to nomination by the concernedMinister. Such member or members shall not be dischargedextept by a Royal Decree. The company's articles ofassociation shall determine the number of directors who shallrepresent the share of the Sultanate or any of its administrativeunits.
The remaining members of the Board of Directors shall beelected in pursuance of the provisions of this law and thecompany's articles of association. The shares representing theinterest of the Sultanate public establishment shall participate inthis voting unless the company's articles of association providesotherwise.
All appointed members of the Bo~~d of Directors shall exercise- _:'"" --ail powers inherent in the office of the director. Acts preformedby the directors appointed by a Royal Decree in the exercise oftheir powers as directors, however, shall not subject them, theSultanate or the public establishment to liability under theprovisions of this law.
CHAPTER SEVENMARITIME COMPANIES
Article (134): The maritime company is a joint stock company which isestablished for the sole purpose of engaging in maritimeactivities provided in the Maritime Law.
Article (135): The maritime company shall be subject to the provisions of thislaw related to the joint stock companies with such amendmentsand exceptions provided in the Maritime Law.
PART SIXLIMITED LIABILITY COMPANY
CHAPTER ONEESTABLISHMENT OF THE LIMITED LIABILITY COMPANY
Article (136) The limited liability company is a commerCial company with afixed capital divided into equal shares. It consists of two or morenatural or juristic persons whose liability is limited to the norminalvalue of their shares in the caital of the company The numberof partners of the limited liability company shall not exceed fortypartners.
The limited liability company shall be subject to all provisionsprovided in Part One of this law which are not contradictory tothe provisions prescribed in this part.
The partners shall register the limited liability company in theCommercial Register pursuant to the law.
Article (137): The name of the limited liability company may consist of anyword and may include the name of one or more partners of thecompany provided that the name of the company shall not bemisleading as to the objectives of the company, its identity orthe identity of its partners, The name of the company shall,wherever it appears, be followed by the words "limited liabilitycompany" or by the abbrevation "L.L.C."
If a violation of thELfH'{lVisions of the preceeding paragraph hascaused a third party in good faith make a mistake as to the extentof the partner's liability, the persons responsible for such violationshall be deemed responsible in persons towards for such violationshall be deemed responsible in persons towards such party forthe damages that may befall him as a result.
Artlcl. (138) : The capital of a limited liability company shall not be less thantwenty thousand Omani Rials, The Director General of Com-merce may exempt some companies from this limit pursuant tothe provisions issued by a decision of the Minister of Commerce
and Industry whereby the company's capital shall not be lessthan three thousand Omani Rials. All shares of the companyshall be of equal nominal value and the full value thereof shallbe paid in upon subscription These shares shall not be representedby negotiable deed. If the capital of a limited liability companydecreased to less than its minimum limit or the registered capital,any interested person may warn the company in writing to restorethe capital to its previous minimum leveL If the company failedto do sowithinoneyearfromsuchnotice,suchpersonmayseekdissolutionof the company from the concerned court.
Article (139): Contributions to the capital of a limited liability company may bemade In cash or in kind. However, such contributions shall notcomprise the services or labour of any person.
A limited liability company shall not resort, directly or Indirectly,to public subscription in raising or increasing its capital, or toborroWing of funds
Article (140): A limited liability company shall not be deemed finallyconstituted nor shall the liability of its shareholders be limiteduntil the following conditions have all been fulfilled
A - The memorandum of association of the company has beensigned by all the shareholders of the company
B· The number of shares to be owned by each shareholderhas been determined and the nominal value of all shareshas been fully paid in cash or in kind.
C - Registration of the company in the Commercial Register.
For the payment of the value of the company's shares a specialaccount shall be opened with a bank operating In Oman, in thename of the company with the term "Under Formation" whereineach shareholder shall deposit, in cash, the full nominal valueof his shares. As for the contributions in kind, the auditors of anoffice licensed to operate in Oman may submit a reportconfirming the value and payment of each shareholder'scentribution In kmd in the capital of the company underestablishment, or that the value of the contribution in kind shallbe determined by one or more experts appointed by theMinistry of Commerce and Industry pursuant to an applicationsubmitted by the shareholders in accordance with the rules andprocedures decided by the Minister of Commerce and Industry.
The said bank shall not release such deposits to anyone otherthan the managers of the company upon the presentation of acertificate confirming the registration of the company in theCommercial Register, or the depositors should the establishmentof the cOr'\lpanybe abandoned.
If the company is not finally established within a period of sixmonths from the date of the first contribution to the capital of thecompany, any of the shareholders may annual thememorandum of association of the company by giving notice tothe bank and the shareholders and thereupon all depositorsshall have the right to refund their respective capitalcontributions on deposit in the bank.
Article (141): The limited liability company shall keep a membership registerin which the name of each shareholder shall be listed togetherwith his nationality, his domicile and the number of shares heowns.
Article (142): Shares of a limited liability company shall not be divisible butthey may be owned by more than one person provided thatsuch persons shall have a single representative who shalldeemed by the company to be the owner of the shares under
. joint ownership. Such representative shall be the person whosename shall stand first in the membership register although thedisposal of the shares shall require an instrument signed by alljoint owners.
Joint shares owners shall be deemed jointly and severally liablefor the obligations arising from such ownership and shall bedeemed one person for purposes of determining the nvmber ofpartners provided in Article ("i36). - .::------
Article (143): Subject to the restrictions provided by law and subject to theprovisions of the company's memorandum of association. anypartner of the limited liability company may assign any of hisshares in the company to any other partner of the company orto-a third party by a written instrument.
Article (144): If a partner of the limited liability company wishes to assign anyof his shares in the company to anyone who is not yet apartner of the company. he shall send a written notice,expressing his wish to do so, to the managers of the company,together with as many copies of such notice as there are
partners in the company, provided such notice shall indicate thenumber of shares he intends to assign, the name, nationalityand address of the proposed assignee and the terms of theproposed assignment. The managers shall acknowledge thereceipt of the notice of intent and the date of reciept, and shallpromptly send a copy of the notice to eaCh other partner of thecompany at his domicile which is indicated in the partnersregister The managers, when sending such notice to the otherpartners, shall advise such members, in writing, on theirpreemptive right to purchase the shares offered on the termsspecified in the notice by giving notice of their intention to do soto the managers of the company and by depositing the fullamount of the purchase price of the number of shares they wishto purchase within fourty-five days from the date on which thenotice of the proposed ass"gnment has received by themanagers. The notice of intent to exercise the preemptive rightshall not be valid unless it expresses acceptance of all theterms, described in the notice of proposed assignment, unless itis accompanied by an acceptable deposit of the full purchaseprice and unless it is received by the managers within theperiod provided in this article.
ArtiCle (145): If valid notices of intent to exercise the preemptive right arereceived from more than one partner and the aggregate numberof the shares such partners wish to purchase is greater than thenumber of shares offered, then the shares offered shall bedivided between them to the nearest whole share in proportion tothe number of shares owned by each of them, and any remainingshares shall be held by such partners under joint ownership. If apartner elects to purchase less than his proportionate share, allshares he has elected to purchase shall be allocated to him andthe remaining shares shall be divided among the remainingpartners pursuant to the provisions of this Ariicle.
Article (';46): If no valid notice of intent to exercise the preemptive right isreceived from any partner of the company, or if the valid noticesreceived relate in the aggregate to less than the number ofshares offered, the managers may decide to purchase. in thename of the company and on the terms provided in the notice ofthe proposed assignment, such number of shares oHered whichhave not been purchased by the partners of the company.
provided that the company's memorandum of association or anyresolution adopted by the partners meeting provides otherwise,and provided that the purchase price of such shares shall not bepaid from the capital of the company or its legal reserve. Sharesso purchased in the name of the company shall be held by allpartners of the company under joint partnership in proportion tothe number of shares owned by each of them, however, suchshares as long as they are so held, shall neither be voted inpartners meetings nor be counted in determining a Quorum or arequired majority at such meetings, nor shall such shares beconsidered in the distribution of dividends or the assets of thecompany. Upon sale of such shares, .the proceeds shall be paidto the company and shall be added to the reserves.
Article (147): If the partners of the companY have decided to purchase theshares offered, the managers of the company shall send awritten notice to the selling partner expressing their wish toexercise the preemptive right and such notice shall beaccompanied by the purchase price of the shares specified 'Inthe notice of proposed assignment. If such notice and the saidamount are not received by the selling partner within fifty daysfrom the date on which the notice of proposed assignment wasreceived by the managers, such partner shall be free to effectthe assignment provided such assignment is effected within thenext thirty days and in accordance With the terms specified inthe notice of the proposed assignment.
Article (148): The preemptive rights related to the partners and the companyshall not apply to the shares transferred by inhentance or will onthe death of a partner. If shares are transJE:p'~d by inheritanceor will to more than one person causing the number of partnersto exceed fourty partners: then such shares shall be held by allheirs or legatees under joint ownership unless such heirs orlegatees agree to transfer such shares to such number of themwhich maintains the number of partners within the maximumallowed.
Article (149): The capital of the limited liability company may be increased byan unanimous decision of the partners. Each partner shall havethe right to subscribe for a number of new shares in proportion
to the number of shares he owns, and if a partner hassubscribed for less than the proportion he is entitled to, theremaining shares may be subscribed for only by other partnersin proportion to the number of shares owned by them.
Article (150) : The capital of the limited liability company may be reduced byan unanimous resolution made by the partners if such capitalexceeds the need of the company or if the company hasincurred losses; however, the capital of the company shall not.in any case. be reduced to less than twenty thousand OmaniRials.
The resolution to reduce the capital of the company shall bepublished in Arabic local newspapers for two consecutive timestogether with a notice inviting all the creditors of the company tosubmit their objections within thirty days from the date ofpublication.
The reduction of capital shall be effective only after the expiry ofsuch thirty days and after all objecting creditors have beensatisfied either by paying their debts or by giving them suitablesecurity.
CHAPTER TWOMANAGEMENT OF THE LIMITED LIABILITY COMPANY
Article (151): The management of the limited liability company shall beentrusted to one or more managers who shall be naturalpersons and who may be partners or non-partners of thecompany. Managers shall be appointed for a limited orindefinite period of time pursuant to the company'smemorandum of association. Notwithstanding any agreement tothe contrary, any manager may removed by a decision of thepartners meeting, and if the manager is also a partner of thecompany, he shall not participate in the voting on the resolutionrelated to his removal.
A manager may also be removed by a decision of the Authorityfor the Settlement of Commercial Disputes upon request of oneor more partners of the company if the Authority finds alegitimate cause that justifies such rer:'0val.
Article (152): The managers of the limited liability company may perform allacts in pursuance of the company's objectives unless theirauthority is limited by the company's memorandum ofassociation or by subsequent agreements made betwee." all thepartners of the company and registered In the CommercialRegister
The managers, however, shall not perform t~,e following actsunless they are expressly authorized to do so by the company'smemorandum of association or by an unanimous decision of allthe partners:
A - Donations, except donations required by business and, inordinary, small amounts.
8 - Sale of all or substantial part of the company's aS3ets.
C - Mortgage or pledge the company's assets except to securethe company's debts incurred in the ordinary course of thecompany's business.
D - Guarantee debts of third parties, except guarantees madein the ordinary course of business for the fulfilment of thecompany's objectives.
Article (153): The limited liability company shall be bound by all actsperformed by the managers acting in its name and within thescope of their powers. A third person in good faith shall havethe right to assume that any act done by the managers of thecompany in the course of its busiress comes within the scopeof the managers' authority and the company shall be boundthereby unless the limitation of the managers' powers isregistered in the Commercial Register.
Article (154): In respect of each financial year, the managers shall with hold10% of the net profits of the company after deduction of taxesas a legal reserve until such reserve amounts to. at least,one-third of the capital of the company. The legal reserve shaHnot be distributed to the company's partners as dividends.
Article (155): The managers of the limited liability company shall be liable tothe company. its partners and third parties for damages arisingfrom their acts in violation of the law or beyond the scope oftheir powers and from any fraud or negligence in theperformance of their duties or from their failure toact as prudentmen under certain circumstances.
If liability under the preceding par9'graph is directed to morethan one manager, the Authority for the Settlement ofCommercial Dispute~ may hold each of such managers liablefor all or such part of the total damages as the authority deemsappropriate under certain circumstances. Any provision or termthat limits the liability of the managers shall be null and void.
Article (156): The company may institute an action against any of itsmanagers whom it regards responsible for the damages causedto it in a<;cordance of the provisions of the preceding Article-.The partners meeting shall appoint a person to follow up thecase on behalfof the company and pay the costs of the casefrom the company's funds. If the company is under liquidation,the liquidator of the company may decide the institution of theaction. Any partner may propose the suing of the managers,and if the partners meeting does not adopt such proposal, heshall have the right, then, to institute the case on behalf of themeeting. If such case is successful, such member shall bereimbursed the costs and expenses of the case from theamount adjudged provided the balance shall be paid to thecompany.
Article (157): The limited liability company shall have at least one auditor whoshall be appointed by the partners' meeting if:
A· The number of the company's partners exceeds ten.
S· The capital of the company exceeds fifty thousand OmanlRials
C· The appomtment of an auditor is demanded by one or morepartners representing, at least, one-fifth of the capital of thecompany.
Article (158): The term of office, qualifications, rights and duties and liabilityof auditors of the limited liability company ~hall be the same asthe term of office, qualifications, rights and duties and liability ofauditors of the Jointstock company.
Article (159): Within four months after the end of the company's financial year,the managers of the limited liability company shall prepare abalance sheet as of the end of the company's financial year anda profit and loss statement for the expired financial year. If thecompany has auditors, the managers shal put such documents,together with a report on the company's operations dUring theexpired financial year and the proposed allocation of the netprofits, if any, at the disposal of the company's auditors withmthe same period. The auditors sh~1Iprepare their report to thepartners meeting and put a copy thereof at the managersdisposal within two months from the date of their receipt of thecompany's financial statement and the managtrs' report.
Article (160): The managers shall send a copy of the company's balancesheet and the profit and loss statement and the reports of themanagers and audit6rs~"-jfany, concernmg the expired finanCialyear. together with a notice of a partners meeting for theapproval of these documents and the allocation of the netprofits. if any to each partner of the company within SIXmonthsafter the end of the company's financial year. The originals ofthese documents shall be available for inspection by thepartners of the company at the company's prinCipal place ofbusiness during a period of at least two weeks Immediatelypreceding the date set for the partners meeting for the approvalof these documents.
In addition, each partner shall have the right to Inspect theoriginal balance sheet. profit and loss statements, reports of the
managers and auditors, if any, related to the last five financialyears of the company at any time during business hours at theprincipal place of business of the company. Any agreementcontrary to the provisions of this Article shall be null and void.
Article (161): The partners of the limited liability company shall act by virtueof resolutions adopted by voting at partners meetings. However,decisions in matters other than the distribution of profits.approval of the balance sheet, profit and loss statement and thereports of the managers and auditors, if any, may' also bereached without a meeting if all partners of the companyconsent to any such decisions in writing.
Article (162): Every partner shall have the right to attend partners meetingand shall have one vote for each share he owns or represents.
A member may give a written proxy to another person to attendand vote at the partners meeting as his representative. Suchproxy may be revoked by the partner at any time. Suchrepresentative shall be a member of the company unless thecompany's memorandum of association provides otherwise.
Article (163): Membership meetings may be convened by the company'smanagers at any time and shall be convened by the managerswherever required by law or the company's memorandum ofassociation or upon request by one or more partnersrepresenting at least one fifth of the company's capital. If themanagers fail to convene the partners meeting when sorequired or requested, any member may request the Authorityfor the Settlement of Commercial Disputes to appoint a personto convene the sa'ld meeting and prepare the agenda.
Notice of the meeting shall be send to each-~arffrer at leasttwenty days prior to the date set for the meeting. The noticeshall not be valid unless it includes the agenda of the meeting.The partners meeting shall consider only the matters includedin the agenda of the meeting. However, in exceptional casesthe meeting may consider any unanticipated and urgent matterbrought before the meeting
Article (164): Partners and proxies representing all the shares of the companymay hold a partners meeting without regard to formalities ofnotice, and such meeting may deliberate over all matters whichare within the authority of the partners meeting to decide.
Article (165): The resolution of the partners meeting shall not be valid unlessthe meeting is attended by partners and proxies who representat ledst fifty percent of the capital of the company. Failing suchquorum, a second meeting shall be convened to discuss thesame agenda.
The second meeting shall be notified to the partners at leastone week prior to the date set for such meeting. The resolutionof the second meeting shall be valid regardless of the capitalrepresented, provided such meeting is held within one monthfrom the date of the first meeting.
Article (166): Resolutions of the partners meeting shall be adopted by therelative majority of the votes cast in respect of a givenresolution, except when a greater majority is required by the lawor the company's memorandum of association.
Article (167): Notwithstanding the provisions of Article (165), an unanimousdecision of all partners is required to increase or reduce thecapital of the company or to transform the company into ageneral or limited partnership, and the favourable vote of amajority of partners representing at least three quarters of thecapital. IS required for any other amendment of thememorandum of association or for a decision to transform thecompany into a joint stock company.
Article (167)(1) : The interest of the Sultanate or any of its administrative unitsshall be represented by one manater or more who shall beappointed by virtue of a Royal Decree pursuant tonomination by the competent minister. Such managers shallnot be removed except by a Royal Decree. The number ofmanagers - ;E{p~esenting the Sultanate or any or itsadministrative units shall be determined by the company'smemorandum of association. Neither the managersappointed by a Royal Decree, nor the Sultanate or any of itsadministrative units shall be held liable, according to the.provislons of this law, for their acts in the course ofperforming their functions as managers of the company.
CHAPTER THREEDISSOLUTION AND LIQUIDATION OF THE LIMITED
LIABILITY COMPANY
Article (168): The limited liability company shall be dissolved for any of thereasons for dissolution provided in the company'smemorandum of association or in Article (14) of this law. Thepartners meeting may resolve, at any time, to dissolve thecompany upon the favourable vote of a majority of membersrepresenting. at least, three quarters of the company's capital.
Article (169): After its dissolution the limited liability company shall beliquidated in accordance with the law and the provisions of thecompany's memorandum of association, provided suchprovisions shall not violate any provisions of the law ofmandatory nature.
PART SEVEN
PENALTIES
Article (170): The following persons shall be punished, upon conviction, byimprisonment from three days to three years, or a fine of ten tofive hundred Omani Rials, or by both such penalties:
A - Every person who, with' intent to defraud, includes or usesfalse information in a commercial company's memorandumof association or articles of association, in an application forauthorization to establish a joint stock company or in itsprospectus, or in any document necessary for theestablishment or a commercial company: or who, withintent to defraud, omits any essential fact deceived therebyto his detriment.
B - Every person who induces another to join a commercialcompany by using fraudulent means, every promoter ordirector of a joint stock company who participates in theissue of an invitation to the public to subscribe for shares orbonds of a joint stock company knowing that such invitationis issued in violation of the provisions of the law, and everyperson who offers such shares or bonds for subscription ifsuch person is ware that such violation has been committed.
C - Every person who, with intent to fraud, overvalues anycontribution in kind to the capital of a commercial companyby an amount exceeding twenty-five per cent of its truevalue.
0- Every person who, knowingly, participates in thedistribution of fictitious profits of a commercial company onthe basis of a fraudulent balance sheet, or without having abalance sheet, or on the basis of a fraudulent inventory orprofit and loss statement.
E - Any manager, director, auditor, liquidator or any personcharged with the management of a commercial company,who intentionally includes or uses false information in thebalance sheet or profit and loss statement of a commercial.company, or in a report to partners or to shareholders or
membership meeting thereof; or who intentionally omits anyessential fact from any of the said documents; if the truefinancial position of the company shall have been therebyconcealed from the company's partners or third parties.
The following persons, by virtue of their personal capacity,shall be penalized by a fine of not less than five thousandOmani Rials and not more than ten thousand Omani Rialson their failure to convene the annual ordinary generalmeeting of the company on the time provided for suchmeeting:
A - The chairman and members of the Board of Directors.
B - The auditors of the company in case of failure of the Boardof Directors to convene the meeting.
Article (171): The following persons, on their conviction, shall be penalized bya fine of ten to five thousand Omanl Rials:
A - Every person who, by way of negligence, includes or usesfalse information in the memorandum of association orarticles of association of a commercial company, in anapplication for authorization to establish a Joint stockcompany or in the prospectus of such company, or in anydocument necessary for the establishment of a commercialcompany; or who, by way of negligence, omits anyessential fact from any of the said documents.
B - Every person responsible for a violation by the company ofthe provisions of Article (4) of this law.
e - Every partner, director or manager of a commercialcompany who violates the provisions of Article 8, 107 or108 and every auditor of aJo~t--stoCk company or a limitedliability company who violates the provisions of the thirdparagraph of Article (111) of this law.
o - Every person who, by way ot- negligence, overvalues anycontribution in kind to the capital of a commercial company.
E· Every director, manager or any other person charged withthe management of a commercial company. which hasauditors, who seriously interieres with the exercise of theauditors' functions.
F· Every person who, knowingly,distribution of any part of the legalArticles 106 and 154 of this law,
participates in thereserve in violation of
G· Every manager, director, auditor, liquidator or any personcharged with the management of a commercial comapnywho, by way of negligence, includes or uses falseinformation in the balance sheet or profit and lossstatement of a commercial company. or in a report tomembers or to shareholders or partners meeting thereof; orwho, by way of negligence. omits any essential fact fromany of the said documents,
AF1icle (172): Punishment under the provisions of this part shall not affect thelegal consequences of the act or omission punished, includingcivil liability for damages caused by such act or omission.
PART EIGHT
TRANSITIONAL AND FINAL PROVISIONS
Article (173): The commercial companies wholly owned by Omani nationalsshall be deemed legally formed even if such companies do notadopt one of the forms of commercial companies provided inthis law, or even if their memorandum and articles of associationcontradict the provisions of this law provided such companiesprove to the Ministry of Commerce and Industry, by written orverbal proof presented within one year from the date of thepublicatIOn of this law in the Official Gazette, that they wereformed and engaged in regular commercial activity in Omanprior to the publiction of this law in the Official Gazetle.
Subject to the provisions of the preceding paragraph, suchcompanies shall be governed by the provisions of this lawgoverning the most similar form of company described in this law
Article (174): Commercial companies which have one or more members whoare not Omani nationals shall be deemed legally formed even Ifthey do not adopt one of the forms of commercial companiesdescribed in this law or even if their memorandum or articles ofassociation contradict the provisions of this law, provided suchcompanies establish to the Ministry of Commerce and Industry,by written or verbal evidence presented within one year fromthe publication of this law in the Official Gazette, that they wereformed and engaged in regular commercial activity in Omanprior to thE"first day of January.,~l.970, and provided further thatthey did not directly or indirectly increase their capital or widenthe scope of their activities after such dates.
Subject to the provisions of the preceding paragrah, such~ompanies shall be governed by the provisions of this lawgoverning the most similar form of company described in this law.
Article (175): Commercial companies which have one or more non-Oman;partners and which were established after the first day ofJanuary, 1970 and before the date of publication of this law inthe Official Gazette, and which comply with or exempt from theprovisions of the Foreign Business and Investment Law. shall
be granted a period of one year as of the date of publication ofthis law in the Official Gazette to adopt one of the forms ofcommercial companies described in this law and to adjust theirmemorandum and articles of associations, their status andactivities to comply with the provisions of this law.
Any company to which the provisions of the precedingparagraph apply. and which fails to abide by such provisionswithin the one· year period specified for such company, shallbe unlawful and may be dissolved and liquidated at the end ofthe said pertod pursuant to an application submitted to theAuthority for the Settlement of Commercial Disputes by theMinister of Commerce and Industry or any other person.
Artiel' '176): This law shall be published in the Official Gazette.
