Chapter 2 Chapter 2 Placing a Licensee Under Administration
Article (136) Reasons for Placing a Licensee Under Administration(a) The Central Bank may, pursuant to a justified resolution, assume the administration of a Licensee or may appoint another person (the "External Administrator") to conduct the administration of a Licensee on behalf of the Central Bank under any of the following circumstance:1) If the Licensee becomes insolvent or appears most likely to be insolvent.2) If the license is amended or cancelled pursuant to the provisions of items (1) and (3) of paragraph (c) of Article (48) of this law3) If the Licensee continued to provide regulated services which resulted in inflicting damages to financial services industry in the Kingdom.(b) In this part the term administrator denotes the Central Bank if it assumes the administration of the Licensee or any external administrator to be appointed for this purpose.
Article (137) Appointment of External Administratora. The Central Bank shall specify the terms and conditions pursuant to which the External Administrator shall practice his duties and obligations.b. The External Administrator shall act in accordance with any instructions that the Central Bank may issue from time to time, and he shall submit the reports relevant to the administration to the Central Bank.c. The Licensee shall bear all administration costs and expenses including the External Administration fees.
Article (138) Announcement of Placing a Licensee Under Administration(a) The Administrator shall, promptly after assuming the administration of a Licensee, publish a notice to this effect in the Official Gazette and in one Arabic and one English language newspaper published in the Kingdom, and to show such notice in every place of business of the Licensee in the Kingdom all through the period in which he assumes the administration.(b) The appointment of the Administrator shall only have effect on the day following the publication of such notice pursuant to the provision the preceding Article.(c) The phrase "In Administration" shall be added after the name of the Licensee on all relevant correspondences during the period of administration.
Article (139) Appeal Against Placing the Licensee Under Administration(a) A Licensee may, within the ten days following the date of publication of the decision of placing it under administration, appeal to the Central Bank against such decision. The appeal should be submitted in the form prepared by the Central Bank for this purpose and accompanied by such supporting documents and information as the Central Bank may specify.(b) A decision should be reached with regard to the said appeal, and the appellant should be notified with the decision in writing within fifteen days as of the date of submitting such appeal. However, reasons must be given in case of rejecting the appeal.(c) The Licensee may challenge, before the Competent Court, the decision of administration or rejection of his appeal, within thirty days as from the date he receives such decisions.
Article (140) Powers of the Administrator(a) The Administrator shall have all the powers necessary for the management and running the business of the Licensee, including the following:1. The power to continue or to temporary suspend the Licensee operations.2. The power to suspend or limit the discharge of financial obligations of the Licensee.3. The power to conclude agreements and to sign any documents on behalf of the Licensee.4. The power to commence and defend any legal proceedings in the name of the Licensee, or taking any other legal proceedings to which the Licensee is a party.(b) Without prejudice to the provision stated in paragraph (a) of the preceding article, the Administrator may carry out the following:1. Declare a moratorium in respect of any debts of the Licensee.2. Discharge obligations of the Licensee to certain creditors in preference to other creditors, if this is in the advantage of the Licensee.3. Dismiss officers and employees of the Licensee, provided that reasons should be given for the dismissal decision.4. Appoint officers and employees for the Licensee.5. After obtaining the approval of the Competent Court, and without prejudice to market agreements and, where applicable, the rights of the other party to be compensated, the administrator may nullify any agreement entered into by the Licensee before placing the Licensee under administration if such action is in the interest of the Licensee or taken to protect the interests of its customers, or to avoid occurrence of an irrevocable damage.6. Undertake any necessary actions in the interest of the Licensee and for the protection of the interests of its customers and creditors.
Article (141) Duties of the Administrator(a) The Administrator shall, within thirty days of his assuming the administration of a Licensee, make an inventory of the rights, assets and liabilities of the Licensee. A report of two copies should be prepared on such inventory, a copy of which shall be kept at the principal place of business of the Licensee in the Kingdom and shall be available for inspection by creditors and other interested parties. The other copy shall be kept at the Central Bank.(b) The inventory report should be updated from time to time taking into consideration the requirements of the previous paragraph.(c) The Administrator shall take all necessary measures, during the period of administration, to collect all of the entitlements due to the Licensee.
Article (142) Suspension of Proceedings
During the period of administration, no action may be taken to enforce any security over the property of the Licensee and no legal proceedings or any other measures may be commenced or continued against the Licensee or its property except with the approval of the Administrator or in the course of executing a court judgment or order issued before the date on which the Licensee was placed under administration.
Article (143) Termination of Administration
The Administrator shall submit, with the prior approval of the Central Bank in case of an External Administrator, within a period of two years from the commencement of the administration of a Licensee, a petition to the Competent Court for compulsory liquidation of the Licensee or otherwise to terminate the administration and restore the management to the officials of the Licensee.