MoCI outlines maximum lump sum remuneration to chairman and board members of joint stock companies

The joint stock entities, which make profits and choose not to distribute dividends to shareholders or distribute dividends of less than 5% of the capital, can at the maximum offer QR125,000 as remuneration to chairman and QR100,000 each to other board members.

If the joint stock company is not making profit, then the maximum remuneration to chairman and other board members have been capped at QR75,000 per member.

These were reiterated at an introductory seminar, organised by the Ministry of Commerce and Industry (MoCI), to discuss and explain the procedures related to the circulars issued to public and private joint-stock companies during the first half of 2024, and how to implement them.

The seminar explained the most important procedures relating to the implementation of Circular No. (2) relating to the maximum lump sum amount that may be distributed to board members in public and private joint-stock companies. This circular was issued as part of the implementation of the provisions of Article (119/Paragraph 2) of Law No. (11) of 2015 of the Commercial Companies Law, as amended by Law No. (8) of 2021.

The seminar witnessed a large attendance from representatives of public and private joint-stock companies, as well as auditing firms.

Salem bin Salem al-Mannai, Director of the Corporate Affairs Department at the MoCI, stressed the importance of the circulars, issued by the department, in achieving transparency within public and private joint-stock companies. He added that these circulars come as part of the ministry's efforts to keep up to date with global economic developments and meet the needs of the local market.

Sheikha Jawaher bint Mohamed al-Thani, Head of the Control and Inspection Department at the MoCI highlighted the ministry's continued efforts to streamline operations for investors and shareholders. She noted that the provision of support ultimately delivers enhanced performance for both public and private joint-stock companies and contributes to driving economic development in the country.

Abdulrahman al-Jassim, Legal Researcher in the Corporate Affairs Department, discussed the most important procedures related to Circular No. (1) regarding the powers of the chairman of the board of directors and the delegation of board members and senior executive management members.

This circular was issued by the Corporate Affairs Department at the MoCI, as part of implementing the provisions of Articles (100, 103, 107, 121) of Law No. (11) of 2015 of the Commercial Companies Law, as amended by Law No. (8) of 2021.

The invitation by the board chairman to the ordinary or extraordinary general assembly meeting must be based on a decision by the company's board of directors to call for this meeting.

The appointment or removal of authorised signatories in the commercial register must be pursuant to a decision by the company's board of directors. The chairman may not appoint or remove authorised signatories in the commercial register unless authorised by a decision from the board of directors or the company's Articles of Association, among other powers.