Partnership Articles of Association serve as the constitutional document for partnerships in Saudi Arabia, essential for establishing any formal partnership structure under Saudi law. This document is required when two or more parties wish to form a partnership and must be filed with the Ministry of Commerce as part of the business registration process. It outlines critical aspects such as capital contributions, profit-sharing ratios, management responsibilities, and dispute resolution mechanisms, all while ensuring compliance with both the Saudi Companies Law 2015 and Sharia principles. The document is particularly relevant in the context of Saudi Arabia's Vision 2030, which encourages private sector growth and foreign investment, requiring careful attention to both local regulatory requirements and international business standards.
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1. Parties: Identifies all partners, including full legal names, nationalities, ID/CR numbers, and addresses
2. Background: States the partners' intention to form a partnership and brief context of the arrangement
3. Definitions: Defines key terms used throughout the document
4. Partnership Name and Type: Specifies the official name and legal classification of the partnership
5. Partnership Objects: Details the authorized business activities and scope of the partnership
6. Principal Office: States the official registered address and provisions for branches
7. Duration: Specifies the term of the partnership and renewal provisions
8. Capital and Shares: Details the partnership's capital, partners' contributions, and share distribution
9. Management and Administration: Outlines management structure, appointment of managers, and their powers
10. Partners' Rights and Obligations: Defines partners' voting rights, profit sharing, and responsibilities
11. Partner Meetings: Establishes procedures for partner meetings, voting, and decision-making
12. Financial Affairs: Covers fiscal year, accounts, auditing, and profit distribution
13. Transfer of Shares: Details procedures and restrictions for transferring partnership interests
14. Termination and Liquidation: Specifies grounds for dissolution and liquidation procedures
15. Dispute Resolution: Establishes mechanisms for resolving disputes between partners
16. Governing Law: Confirms Saudi law application and Sharia compliance
1. Non-Competition: Restricts partners from competing activities - include when partners have other business interests
2. Intellectual Property: Addresses IP ownership and usage - include for partnerships involving technology or branded services
3. Foreign Partner Provisions: Special provisions for foreign partners - include when foreign investors are involved
4. Deadlock Resolution: Specific procedures for resolving management deadlocks - include for 50/50 partnerships
5. Tag-Along/Drag-Along Rights: Share transfer provisions - include for partnerships with majority/minority partners
6. Corporate Social Responsibility: CSR commitments - include for larger partnerships or those in sensitive sectors
7. Succession Planning: Inheritance and succession provisions - include for family partnerships
1. Capital Contributions Schedule: Detailed breakdown of each partner's capital contribution
2. Partner Information Schedule: Comprehensive partner details including contact information and representatives
3. Business Plan: Initial business plan and operational strategy
4. Management Structure: Detailed organizational structure and management responsibilities
5. Power of Attorney: Format and terms for powers of attorney granted to managers
6. Profit Distribution Policy: Detailed methodology for calculating and distributing profits
7. Required Licenses: List of necessary licenses and permits for operations
8. Property Schedule: Details of any property or assets contributed to the partnership
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