By Staff writer
Company directors will face up to five years in jail and fines of up to $1.3m for corporate law violations
Company directors in Saudi Arabia face up to five years in jail and fines of up to SR5 million ($1.3 million) if they defraud partners or fail to submit proper auditing reports, it was reported on Tuesday.
The Saudi Ministry of Commerce has published new rules for violation of corporate law in the kingdom.
It has outlined 33 violations punishable by law – and penalties will be doubled if the same offences are repeated within three years, Arab News said.
The violations include submitting false financial statements, misusing company funds for personal gain, acting maliciously against other employees, or acting in the interests of a different company, the newspaper said.
Executives also must not take loans that contravene company rules, prevent shareholders from exercising their rights, collude with others to pass unwanted decisions or withhold information from company directors or shareholders.
It is also an offence to fail to report if the company has been liquidated, impersonate owners or shareholders of use the company for purposes other than those stated in the licence.
The Bureau of Investigation and Public Prosecution is authorised to take action if these and various other violations unspecified in the report are committed.