Companies Regulations 2005
Click here to view earlier versions of QFC Reg 2 – Companies Regulations.
Enactment Notice
The Minster of Economy and Commerce hereby enacts the following regulations pursuant to Article 9 of Law No. (7) of 2005.
Ali Shareef Al Emadi
Minister of Finance of the State of QatarIssued at: the Qatar Financial Centre, Doha
On: 5th day of April, 2015
Corresponding to: 16 Jumaada al-Thaany 1436A.H
Part 1: Part 1: Application, Commencement and Interpretation
Article 1 - Citation
These
Regulations may be referred to as the Companies Regulations 2005.Article 2 - Application
These
Regulations are made by theMinister pursuant to Article 9 of the QFC Law and shall apply in theQFC . To the fullest extent permitted by theQFC Law , the laws, rules and regulations of theState concerning companies and branches or offices of foreign companies and investments therein, including without limitation the Commercial Companies Law No.(5) of 2002 and the Foreign Investment Law No.(13) of 2000, shall not apply in theQFC .Article 3 - Commencement
These
Regulations shall come into force on the date of their signature by theMinister .Article 4 - Language
In accordance with Article 9 of the QFC Law, these
Regulations are written in the English language and the English text thereof shall be the official original text. Any translation thereof into another language shall not be authoritative and in the event of any discrepancy between the English text of theseRegulations and any other version, the English text shall prevail.Article 5 - Interpretation
Words and expressions used in these
Regulations and interpretative provisions applying to theseRegulations are set out in Part 14.Article 5A - Power of QFC Authority and QFC Regulatory Authority to make rules
The
QFC Authority and theQFC Regulatory Authority , each within the scope of their jurisdiction, authority or powers conferred upon them may make rules to the extent set out in theQFC Law , theseRegulations and any otherRegulations conferring powers, duties and functions on theQFC Authority andQFC Regulatory Authority as they deem necessary or appropriate to implement, carry out or enforce theseRegulations .Amended (as from 5th April 2015). Part 2: Part 2: Companies Registration Office
Article 6 - The CRO
(1) TheCRO was established under theQFC Law and shall be an authority with independent legal personality and full capacity to act as such and perform legal actions in accordance with theseRegulations . Without limitation to the foregoing, theCRO shall have the power to own and dispose of property of any description and to enter into contracts and to sue and be sued.(2) TheCRO will be managed by theRegistrar unless its powers, duties and functions have otherwise been delegated under Article 6(4).(3) TheCRO shall conduct its affairs in accordance with theQFC Law and theseRegulations but shall otherwise have power, by decision of theRegistrar , to determine its own procedures and management.(4) The powers, duties and functions of theCRO under theseRegulations may be delegated either:(A) at the discretion of theQFC Authority to any person as it determines;(B) by theCRO to any person as it determines; or(C) otherwise pursuant to anyRegulations .Amended (as from 5th April 2015). Article 7 - Role of the QFC Authority
(1) TheCRO shall be subject to the supervision of theQFC Authority which shall have the power and function to:(A) ensure that theCRO exercises its statutory powers and performs its statutory functions;(B) review the performance of theCRO and the use of its resources; and(C) give theCRO written directions as to the furtherance of any of its objectives or the performance of any of its functions.Article 8 - Role and functions of the CRO
The
CRO shall have the following functions:(1) to receive and process all applications to incorporate or register all types ofCompanies andBranches eligible for incorporation or registration under theseRegulations and any otherEntities in respect of which theCRO is made responsible pursuant to any otherRegulations ;(2) to keep and maintain in such form as it shall determine an index of the names and registered numbers of theCompanies andBranches which are or have been registered under theseRegulations and any otherEntities which may be registered by theCRO pursuant to any otherRegulations ;(3) to receive and process allDocuments and information required to be filed with theCRO pursuant to theseRegulations or any otherRegulations ;(4) to keep and maintain in such form as it shall determine a register in respect of each of theCompanies andBranches which are or have been registered under theseRegulations and any otherEntities which may be registered by theCRO pursuant to any otherRegulations , to record in such register allDocuments and information filed with or delivered to theCRO in respect of suchCompanies ,Branches andEntities and to allow any person to inspect and take copies from such register during the office hours of theCRO ;(5) to administer and impose any financial penalties provided for in theseRegulations ; and(6) all other functions provided for in theseRegulations or any otherRegulations or otherwise considered by it to be necessary, desirable or appropriate to achieve, further or assist in relation to any of the above.Amended (as from 5th April 2015). Article 9 - Powers of the CRO
(1) TheCRO shall have the following powers:(A) subject to the approval of theQFC Authority , to make rules and publish guidance for the purposes of performing its functions;(B) subject to approval of theQFC Authority , to prescribe forms to be used for the purposes of required filings with theCRO ;(C) subject to approval of theQFC Authority to prescribe the fees payable to it for incorporation, registration, filing and any other administrative services provided by theCRO ; and(D) all other powers provided for in theseRegulations or any otherRegulations or otherwise considered by theQFC Authority to be necessary, desirable or appropriate to achieve, further or assist the performance of its functions.(2) TheCRO shall publish rules and guidance made under theseRegulations by theQFC Authority or theCRO , including without limitation those relating toPrescribed Forms andPrescribed Fees .Amended (as from 5th April 2015). Article 10 - Other zones or centres
The
CRO may, with the approval of theQFC Authority , carry out similar functions to those provided for in theseRegulations in respect of other zones, designated precincts or other centres in theState .Amended (as from 5th April 2015). Article 11 - Accounting and budget requirements of the CRO
(1) The budget of theCRO in respect of each financial year shall be set by theQFC Authority .(2) TheCRO shall be exempt from the control of the Audit Bureau of the State.(3) The financial year of theCRO shall commence on the first day of January and end on the last day of December each year, save that the first financial year of theCRO shall commence on the date on which theQFC Law came into force and shall end on the last day of December of the following year.(4) TheCRO shall keep accountingRecords which are sufficient to show and explain the transactions of theCRO and are such as to disclose with reasonable accuracy at any time the income and expenditure and assets andLiabilities and financial position of theCRO and theRegistrar shall procure that, as soon as reasonably practicable after the end of each financial year, accounts of theCRO are prepared in accordance with internationally accepted accounting principles and audited by an independent auditor, being a firm of chartered accountants with an office in theState , who shall report as to whether the accounts of theCRO show a true and fair view of the financial affairs of theCRO during the financial year in question and the assets andLiabilities of theCRO at the end of the year in question and such other matters as the auditors may consider it appropriate to report on.(5) TheCRO shall as soon as reasonably practicable after the end of each financial year send to theQFC Authority a copy of its audited accounts for the financial year in question and a report of its activities during such financial year. TheCRO shall in relation to its activities submit such further reports to theQFC Authority as theQFC Authority may require.Amended (as from 5th April 2015). Article 12 - Confidentially
The
CRO , its officers, employees, agents or contractors shall comply with the QFCData Protection Regulations and Rules and any other Regulations or rules made by theQFC Authority in respect of confidentiality.Amended (as from 5th April 2015). Article 13 - The Registrar
(1) TheRegistrar shall be appointed and may be removed by theQFC Authority and, subject to Article 6(2), shall be responsible for the day-to-day administration and operations of theCRO to the extent authorised and empowered by theQFC Authority . TheRegistrar shall accordingly exercise such powers and have such authority as theQFC Authority shall from time to time delegate to him.(2) TheRegistrar shall make suitable arrangements for keeping appropriateRecords in relation to the exercise of the powers and performance of the functions of theCRO .Part 3: Part 3: Limited Liability Companies
Section 1: Section 1: Establishment and Corporate Capacity
Article 14 - Limited Liability Companies
(1) A form of legal entity known as a limited liability company may be incorporated in theQFC .(3) Where anLLC has been approved for listing on the Qatar Stock Exchange ("QSE") or any other exchange, and subject to satisfying all applicable requirements of the Qatar Financial Markets Authority ("QFMA") and the QSE or such other exchange or regulator,it shall upon such listing taking place be designated as an "LLC (Public)".(4) All Articles in these Regulations will continue to apply to anLLC (Public) as if it were anLLC . If at any time anLLC (Public) is no longer listed on the QSE or other exchange, it will cease to be designatedLLC (Public).Amended (as from 5th April 2015). Article 15 - Corporate Capacity
(1) AnLLC has separate legal personality from itsMembers whose liability shall be limited to paying to theLLC the amount, if any, unpaid on theShares held by them.(2) AnLLC has the capacity, rights and privileges of a natural person and, without limitation, may enter into contracts, sue and be sued and own assets of all types.(3) In favour of a person who in good faith is a party to any transaction or other act to which theLLC is party, the power of the directors of anLLC to bind theLLC , or authorise others to do so, shall be deemed free of any limitation under theLLC's articles of association.(4) A contract may be made, varied or discharged on behalf of anLLC , by any person acting under its authority, express or implied.(5) ADocument is executed by anLLC if signed by two directors, or one director and the secretary of anLLC , and expressed (in whatever form of words) to be executed by theLLC .Amended (as from 5th April 2015). Article 16 - Transaction entered into prior to corporate existence
(1) Where a transaction purports to be entered into by anLLC , or by a person as agent for anLLC , at a time when theLLC has not been formed, then unless otherwise agreed by the parties to the transaction, the transaction has effect as one entered into by the person purporting to act for theLLC or as agent for it, and he is personally bound by the transaction and entitled to its benefits.(2) AnLLC may, within such period as may be specified in the terms of the transaction or if no period is specified, within a reasonable time after it is formed, by act or conduct signifying its intention to be bound thereby, adopt any such transaction and it shall from that time be bound by it and entitled to its benefit and the person who entered into such transaction shall cease to be so bound and entitled.Section 2: Section 2: Incorporation and Registration
Article 17 - Incorporation of a Limited Liability Company
(1) Any one or more persons may apply for the incorporation of anLLC for the purpose of carrying on aBusiness of a kind permitted by theQFC Law to be conducted in theQFC by signing and filing with theCRO an incorporation document together with thePrescribed Fee and otherwise complying with the requirements of theseRegulations in respect of registration.(2) ThePrescribed Form and incorporation document filed with theCRO shall set out or have attached thereto:(B) the nature of theBusiness to be conducted by theLLC and it shall be sufficient to state that the purpose of theLLC is to engage in any lawful act or activity for whichLLCs may be incorporated under theQFC Law andRegulations ;(C) the address of the registered office of theLLC , which shall be in theQFC ;(D) the date of the financial year end of theLLC ;(E) the fullName andAddress of each of the incorporators of theLLC and the number ofShares each of them agrees to take upon incorporation of theLLC ;(F) the fullName ,Address , date of birth, nationality, business occupation and any directorships held within the last 5 years of all the persons who are to be the first directors of theLLC together with a declaration that each of them is qualified to act as a director or secretary of anLLC pursuant to theseRegulations ;(G) the fullName ,Address , date of birth and nationality of the person who is the first secretary of theLLC ;(H) the amount of the authorised share capital, with which it is proposed that theLLC be registered, and the division thereof intoShares of fixed amount;(I) theLLC's articles of association, signed by the incorporators, setting out the rules for the internal governance of theLLC which shall comply with theseRegulations ; and(J) such other particulars as theCRO may require from time to time.(3) The share capital of anLLC may be denominated in any currency approved by theCRO .(4) The incorporation document and all other documentation required to be submitted to theCRO shall be in English and shall be in such form as theCRO may prescribe or approve from time to time.(5) Article 17(2)(E) does not require the incorporators of anLLC to agree to take anyShares if, on incorporation, theLLC will be aCollective Investment Fund .(6) Article 17(2)(H) does not apply if, on incorporation, theLLC will be aCollective Investment Fund .(7) AnLLC that is aCollective Investment Fund is not required to have an authorised share capital.Amended (as from 5th April 2015). Article 18 - Registration
(1) NoLLC shall be incorporated without the consent of theCRO .(2) On incorporation theCRO shall:(A) give a certificate that theLLC is incorporated with the name specified in the certificate and with effect from the date of the certificate;(B) allocate to theLLC a number, which shall be theLLC's registered number; and(C) enter the name and registered number of theLLC in the index of names and registered numbers maintained by theCRO under theseRegulations .(3) A certificate of incorporation shall be conclusive evidence that theLLC is incorporated with the name specified in it and that the requirements of theseRegulations have been complied with in respect of the incorporation and registration of theLLC and thereafter no defect in the process prior to the incorporation thereof shall affect the validity y of its incorporation.(4) From the date of incorporation, theLLC shall be aBody Corporate having the name contained in the certificate of incorporation and capable forthwith of exercising all the functions of an incorporatedLLC .(5) A decision of theCRO refusing to issue a certificate of incorporation may be reviewed consistent with any applicable standards and procedures issued by theQFC Authority for such purpose.Amended (as from 5th April 2015). Section 3: Section 3: Members and Share Capital
Article 19 - Members
(1) The incorporators of anLLC are deemed to have agreed to becomeMembers of theLLC by signing the incorporation document and on incorporation shall be entered as such in theLLC's register ofMembers (persons other than incorporators who have died or been dissolved).(2) Every other person who agrees to become aMember of theLLC and whoseName is entered in the register ofMembers , is aMember of theLLC .(3) A person may cease to be aMember of anLLC (as well as by death or dissolution) in accordance with the articles of association of theLLC .(4) AMember of anLLC can be of any nationality and either a natural or aBody Corporate .(5) The minimum number ofMembers of anLLC is one.(6) EveryLLC shall keep a register ofMembers , together with:(A) a statement of theShares held by eachMember , distinguishing eachShare by its number (if theShare has a number) and, where theLLC has more than one class of issuedShares , by its class;(B) the date on which each person was registered as aMember ; and(C) the date on which any person ceased to be aMember .(7) Article 19 (1) does not apply to anLLC if, on incorporation, theLLC will be aCollective Investment Fund .Amended (as from 5th April 2015). Article 20 - Rectification of register of Members
(1) If:(A) theName of a person, the number ofShares held or the class ofShares held is, without sufficient reason, not entered in or omitted from anLLC's register ofMembers ; or(B) there is a failure or unnecessary delay in entering on the register the fact of a person having ceased to be aMember a person aggrieved, or aMember of theLLC , may apply to theCRO for rectification of the register.(2) TheCRO may refuse the application or may order rectification of the register.(3) Whether or not theCRO exercises its power under Article 20(2), theQFC Civil and Commercial Court may make one or more of the following orders:(A) on application of theCRO , an order enforcing any orders made by it under this Article 20;(B) on application of a person aggrieved, aMember of theLLC , or theLLC , an order directing theCRO to, or not to order the rectification of the register or to do any act or thing; or(C) on application of a person aggrieved, an order requiring theLLC to pay damages or to do any act or thing.Amended (as from 5th April 2015). Article 21 - Allotment of Shares
Subject to any limitations or provisions to the contrary in its articles of association, the unissued
Shares of anLLC shall be at the disposal of the directors of anLLC who may, subject to any rights previously conferred on the holders of any existingShares , or class ofShares , offer, allot, grant options over or otherwise dispose of suchShares to such persons, at such time and upon such terms as the directors of theLLC may determine.Article 22 - Return as to allotments
(1) When anLLC makes an allotment of itsShares , theLLC shall within 1 month thereafter deliver to theCRO for registration a return of the allotments in thePrescribed Form stating the number and nominal amount of theShares comprised in the allotment, theNames andAddresses of the allottees, and the amount (if any) paid or due and payable on eachShare , whether on account of the nominal value of theShare or by way of premium, and, in the event that anyShares are allotted for a consideration other than cash, a statement of the consideration for which they have been so allotted.(2) This Article does not apply to anLLC that is aCollective Investment Fund .Amended (as from 5th April 2015). Article 23 - Prohibition on allotment of Shares at a discount
(1) AnLLC's Shares shall not be allotted at a discount to their nominal value.(2) If anyShare is allotted in contravention of this Article 23 then the allottee is liable to pay theLLC an amount equal to the amount of the discount, with interest at an appropriate rate to be prescribed by theCRO .Article 24 - Transfer of Shares
(1) TheShares of anyMember of anLLC shall be transferable in such manner as may be provided by the articles of association of theLLC .(2) Subject to Article 24(6), notwithstanding the provisions of its articles of association, anLLC shall not register a transfer ofShares in theLLC unless a written instrument of transfer is duly executed by the transferor and all outstanding sums relating to the transferring shares, if any, have been paid by the transferor to theLLC . For the purposes of trading, anLLC (Public) may allow the transfer of Shares to be made electronically or any other manner permitted by the QFMA, QSE, the relevant exchange or regulator, such transfer shall be sufficient to transfer title in the Shares if registered by theLLC (Public).(3) Nothing in this Article 24 shall prejudice the power of anLLC to register as aMember any person to whom the right to anyShares of theLLC has been transmitted by operation of law.(4) A transfer of anyShare of a deceasedMember of anLLC made by his personal representative, although the personal representative is not himself aMember of theLLC , is as valid as if he had been aMember at the time of the execution of the instrument of transfer.(5) If anLLC refuses to register a transfer ofShares , theLLC shall, within 21 days after the date on which the transfer was delivered to theLLC , send to the transferor and transferee notice of the refusal.(6) Article 24(2) does not apply when a transfer of shares is undertaken in accordance with rules made by theQFC Authority .Amended (as from 5th April 2015). Article 25 - Issue of certificates
(1) Subject to Article 25(3), for eachShare allotted or transferred, aShare certificate shall be issued by theLLC no later than 30 days after the date the allotment is made or the date on which a transfer of theShares is registered in the register ofMembers of theLLC . For anLLC (Public) a record in the QSE or the relevant exchange's registry system is as acceptable as if it were a Share certificate duly issued by theLLC (Public).(2) A certificate executed by theLLC specifying anyShares held by aMember , shall be evidence of the title of theMember to theShares . For anLLC (Public) a record of title to any Shares in theLLC (Public) held in the QSE or the relevant exchange's registry or system will be evidence of good title to anyShares held by theMember .(3) Article 25(1) and (2) do not apply when title to shares is evidenced in accordance with rules made by theQFC Authority which allow for title to be evidenced in some other manner.Amended (as from 5th April 2015). Article 26 - Share premium account
(1) If anLLC issuesShares at a premium to their nominal value, whether for cash or otherwise, a sum equal to the aggregate amount or value of the premiums on thoseShares shall be transferred to an account called the "share premium account".(2) The Share Premium Account may be applied by theLLC :(A) in paying up unissuedShares to be allotted toMembers as fully paid bonusShares ;(B) or in writing off:(i) theLLC's preliminary expenses; or(ii) the expenses of, or the commission paid or discount allowed on, any issue ofShares or debentures of theLLC (C) or in providing the premium payable on redemption of any redeemableShares or any debentures of theLLC .(3) Subject to Article 26(2), the provisions of theseRegulations relating to a reduction of aCompany's share capital apply as if the Share Premium Account were part of its paid up share capital.This Article does not apply to an
LLC that is aCollective Investment Fund .Amended (as from 5th April 2015). Article 27 - Rights attaching to Shares
(1) To the extent permitted by its articles of association, anLLC may create different classes ofShares . Subject to theseRegulations , the rights attaching toShares (or any class ofShares ) shall be determined by the articles of association of theLLC .(2) The articles of association of theLLC shall set out:(A) the right to vote at a meeting of theLLC carried by each class ofShare ;(B) the right to repayments of capital attaching to each class ofShare ;(C) the right to participate in any undistributed profit of each class ofShare ;(D) the rights and obligations pertaining to the transfer of each class ofShare ;(E) the right to dividends and other distributions attaching to each class ofShare ; and(F) any other rights and obligations attaching to each class ofShare .(3) Subject to the provisions of the articles of association of theLLC , eachShare shall rank in all respects equally with any otherShare in theLLC .(4) It shall not be lawful for anLLC to issue bearerShares .Article 28 - Alteration of share capital
(1) AnLLC , if so authorised by its articles of association, may alter its share capital byOrdinary Resolution in any of the following ways:(A) increasing its authorised share capital by creating newShares of such amount as it deems necessary;(B) consolidating and dividing any or all of itsShares (whether issued or not) intoShares of a larger amount than its existingShares ;(C) sub-dividing itsShares , or any of them, intoShares of a smaller amount than its existingShares but so that, in the sub-division of any issuedShares , the proportion between the amount paid and the amount (if any) unpaid on each reducedShare shall be the same as it was in the case of theShare from which the reducedShare is derived;(D) cancellingShares which at the date of passing of theOrdinary Resolution to cancel them, have not been taken or agreed to be taken by any person, and diminishing the amount of theLLC's authorised share capital by the amount of theShares so cancelled; and(E) changing the currency denomination of its share capital or any class thereof to a currency denomination approved by theCRO .(2) A cancellation ofShares under this Article 28 does not for the purposes of theseRegulations constitute a reduction of share capital.(3) AnLLC having altered its share capital pursuant to Article 28(1), shall within 21 days thereafter give notice in thePrescribed Form to theCRO , together with a copy of theOrdinary Resolution effecting the alteration.Amended (as from 5th April 2015). Article 29 - Class rights
(1) If provision for the variation of the rights attached to a class ofShares is made in the articles of association of theLLC , those rights may only be varied in accordance with those provisions.(2) If provision for the variation of the rights attached to a class ofShares is not made as such in the articles of association the rights may be varied if, but only if:(A) the holders of 3 quarters in nominal value of theShares of the class consent in writing to the variation; or(B) aSpecial Resolution passed at a separate meeting of the holders of that class sanctions the variation.(3) Any alteration of a provision in the articles of association for the variation of the rights attached to a class ofShares , or the insertion of any such provision into the articles of association shall itself be treated as a variation of those rights.(4) If the rights attached to any class ofShares are varied in the manner referred to above, the holders of not less than 15 percent of the nominal value of theShares of the class (being persons who did not consent to, or vote in favour of a resolution for the variation) may apply to theQFC Civil and Commercial Court to have the variation cancelled.(5) The application for cancellation of the variation must be made within 21 days after the date on which the consent was given or the resolution was passed and may be made on behalf of theMembers entitled to make it by one or more of them as they may appoint in writing.(6) On any such application theQFC Civil and Commercial Court , after hearing the applicant and any other persons who apply to theQFC Civil and Commercial Court to be heard and appear to theQFC Civil and Commercial Court to be interested in the application, may, if it is satisfied, having regard to all the circumstances of the case, that the variation would unfairly prejudice theMembers represented by the applicant, disallow the variation and shall, if not so satisfied, confirm the variation.(7) The decision of theQFC Civil and Commercial Court on any such application shall be final.(8) In this Article 29, "variation" includes abrogation and "varied" is to be construed accordingly.Amended (as from 5th April 2015). Article 30 - Reduction of share capital
(1) AnLLC , if authorised by anSpecial Resolution and its articles of association, may reduce itsShare capital in any way.(2) In particular, and without prejudice to the generality of Article 30(1), anLLC may:(A) extinguish or reduce the liability on any of itsShares in respect of capital not paid up;(B) either with or without extinguishing or reducing liability on any of itsShares , cancel any paid up capital that is lost or unrepresented by available assets; or(C) either with or without extinguishing or reducing liability on any of itsShares , pay off any paid up capital that is in excess of the requirements of theLLC .(3) NoLLC shall reduce the amount of its share capital under Article 30(1) unless it complies with the following:(A) at a date not more than 30 days and not less than 15 days before the date from which the reduction of the share capital is to have effect, theLLC shall publish a notice in an newspaper approved by theCRO stating the amount of theLLC's share capital at such date, the amount to which, and manner in which, the share capital is to be reduced and the date from which the reduction is to have effect; and(B) on the date from which the reduction is to have effect a certificate shall be signed by at least two directors of theLLC or the sole director if there is only one director declaring either:(i) that on that date and following the reduction of capital, the realisable value of theLLC's assets will be not less than the aggregate of itsLiabilities and issued share capital and Share Premium Account and theLLC will be able to satisfy itsLiabilities as they fall due; or(ii) that all the creditors of theLLC on that date have consented to the reduction.(4) WhereShares are to be cancelled in order to reduce the capital of anLLC theShares shall be acquired at the lowest price at which, in the opinion of the directors, theShares are obtainable, but not exceeding an amount, if any, stated or determined by the articles of association.(5) Where anLLC reduces the amount of its share capital then within 30 days after the date on which the reduction has effect theLLC shall file a notice inPrescribed Form with theCRO together with a copy of the notice referred to in Article 30(3)(A) and the certificate referred to in Article 30(3)(B) above.(6) If, after a certificate is signed in accordance with Article 30(3)(B)(ii) above, a creditor who did not consent to the reduction has a debt or claim against theLLC which theLLC is unable to pay as a result of the reduction, every person who was aMember of theLLC at the date of the certificate is then liable to contribute for the payment of the debt or claim in question an amount not exceeding the aggregate amount which, prior to the reduction, remained unpaid on theShares then held by him.(7) Notwithstanding Article 30 (1), anLLC that is aCollective Investment Fund does not require authorisation byOrdinary Resolution to reduce its share capital in anyway.Amended (as from 5th April 2015). Article 31 - Redemption or purchase of own Shares
(1) AnLLC may, if authorised to do so by its articles of association, and in accordance with the provisions of such articles of association, redeem any of itsShares which pursuant to its articles of association are to be redeemed, or are liable to be redeemed, at the option of theLLC or the holder of the relevantShares .(2) No redeemableShares shall be issued by anLLC , nor shall anyShares in anLLC be converted into redeemableShares , if, following such issue or conversion, there would be noShares in theLLC which are not redeemable.(3) A redemption of redeemableShares shall only be made from the following sources:(A) in the case of the nominal value of theShares , from paid up capital, share premium and other reserves of theLLC ; or(B) in the case of any premium, from realised or unrealised profits, share premium or other reserves of theLLC .(4) Upon redemption ofShares under this Article 31, suchShares shall be taken as cancelled and accordingly the amount of theLLC's issued share capital shall be diminished by the nominal value of thoseShares but redemption shall not be taken as reducing the authorised share capital of theLLC .(5) Where pursuant to this Article 31 anLLC is about to redeemShares , it may issueShares up to the nominal amount of theShares to be redeemed as if thoseShares had never been issued.(6) This Article does not apply to anLLC that is aCollective Investment Fund .Amended (as from 5th April 2015). Article 32 - Power of an LLC to purchase own Shares
(1) Subject to the provisions of this Article 32, anLLC may purchase its ownShares (including any redeemableShares ).(2) Article 31(3), (4), and (5) shall apply to the purchase by anLLC of its ownShares (the "Purchased Shares") as they apply to a redemption of redeemableShares of anLLC . However, if anLLC decides, in accordance with its articles of association, to hold Purchased Shares in treasury ("Treasury Shares"), then Article 31(4) shall not apply. Treasury Shares will be treated as issued capital but will carry: (a) no voting rights (b) no pre-emptive rights for aMember ; (c) no right to receive any dividends; and (d) no rights to receive assets upon theLLC's liquidation.(3) A purchase under this Article must, unless theLLC is aWholly Owned Subsidiary , be sanctioned by anOrdinary Resolution .(4) TheShares to be purchased:(A) may only be purchased in pursuance of a contract approved in advance by anOrdinary Resolution of theLLC ; and(B) shall not carry the right to vote on theOrdinary Resolution authorising the purchase.(5) AnLLC may not under this Article purchase itsShares if as a result of the purchase there would no longer be aMember of theLLC holdingShares .Amended (as from 5th April 2015). Article 33 - Prohibition of financial assistance
(1) AnLLC shall not (directly or indirectly) provide financial assistance to a person to acquire itsShares or Shares in itsHolding Company unless:(A) the giving of the financial assistance does not materially prejudice theLLC's ability to discharge itsLiabilities as they fall due;(B) the giving of the financial assistance is approved by resolution of theMembers holding not less than 90 percent of the nominal value of theShares giving a right to attend and vote at any meeting ofMembers ; or(C) theLLC's ordinaryBusiness includes providing finance and financial assistance is given in the ordinary course of thatBusiness and on ordinary commercial terms.(2) In this Article 33, reference to "financial assistance" is a reference to financial assistance of any kind and includes:(A) making a loan;(B) making a gift;(C) issuing a debenture;(D) giving security over assets; or(E) giving a guarantee or indemnity in respect of another person's liability.(3) The prohibition on financial assistance in this Article 33 shall not preclude:(A) a distribution of theLLC's assets by way of dividend lawfully made or a distribution made in the course of theLLC's winding up;(B) the allotment of bonusShares ;(C) a reduction of capital in accordance with theseRegulations ; or(D) a redemption or purchase ofShares in accordance with theseRegulations .Amended (as from 5th April 2015). Article 34 - Dividends and other distributions
(1) Subject to any limitations or provisions to the contrary in its articles of association, anLLC may, by a resolution of its directors, declare and pay or make dividends or other distributions in money,Shares or other property.(2) AnLLC shall not declare, make or pay any dividend or other distribution if there are reasonable grounds for believing that:(A) theLLC would after the payment of the dividend or making of the distribution be unable to satisfy itsLiabilities as they become due; or(B) the realisable value of theLLC's assets would thereafter be less than the aggregate of itsLiabilities and its issued share capital and share premium account.Article 35 - Consequences of an unlawful dividend or other distribution
Where a dividend or other distribution, or part thereof, made by an
LLC to any of itsMembers is made in contravention of Article 34 and, at the time of such dividend or other distribution, theMember knows or has reasonable grounds for believing that it is so made, he is liable to repay it, or that part of it, to theLLC or, in the case of a dividend or other distribution made otherwise than in cash, to pay theLLC a sum equal to the value of the dividend or other distribution or such part thereof, at that time, together with, in either case, interest at a rate prescribed, or calculated in accordance with, rules made by theCRO .Section 4: Section 4: Names and Change of Names
Article 36 - Registration of name
(1) The name of anLLC must:(A) be written using letters of the English alphabet or such other characters acceptable to theCRO ; and(B) end with:(i) the expression "Limited Liability Company"; or(ii) the abbreviation "llc" or "LLC ".(2) AnLLC shall not be registered by a name:(A) which includes, other than at the end of the name, either the expression "Limited Liability Company" or either of the abbreviations "llc" orLLC ";(B) which is the same as a name appearing on the index of names maintained by theCRO or by the Ministry of Economy and Commerce in theState ; or(C) which in the opinion of theCRO is offensive or otherwise undesirable.(3) Except with the approval of theCRO , anLLC shall not be registered by a name which in the opinion of theCRO would be likely to give the impression that it is connected in any way with theState .Amended (as from 5th April 2015). Article 37 - Change of name
(1) AnLLC may, bySpecial Resolution , change its name at any time to another name with which anLLC may be registered under Article 36.(2) Where anLLC changes its name it shall deliver, within 21 days of theSpecial Resolution , a notice to theCRO and shall pay to theCRO thePrescribed Fee .(3) A notice delivered under Article 37(2):(A) shall be in a form prescribed or approved by theCRO ; and(B) shall be signed by a director or secretary of theLLC or authenticated in a manner approved by theCRO .(4) Where theCRO receives a notice under Article 37(2) it shall (unless the new name is one by which anLLC may not be registered):(A) enter the new name on the register in place of the former name; and(B) issue a certificate of the change of name.(5) The change of name has effect from the date on which the certificate referred to in Article 37(4)(B) is issued.Article 38 - Effect of change of name
A change of name by an
LLC does not:(1) affect any of its rights or duties; or(2) render defective any legal proceedings by or against itand any legal proceedings that might have been commenced or continued against it in its former name may be commenced or continued against it in its new name.Article 39 - Power to require change of name
(1) Where anLLC has been registered by a name which:(A) is the same or, in the opinion of theCRO , too like a name appearing at the time of registration in the index maintained by theCRO ; or(B) is the same as or, in the opinion of theCRO , too like a name which should have appeared in the index at that timetheCRO may within 12 months of that time in writing direct theLLC to change its name within such period as it may specify.(2) If it appears to theCRO :(A) that misleading information has been given for the purpose of the registration of anLLC by a particular name; or(B) that undertakings or assurances have been given for that purpose and have not been fulfilledit may, within 5 years of the date of its registration by that name, in writing direct theLLC to change its name within such period as theCRO may specify.(3) If in theCRO's opinion the name by which anLLC is registered gives so misleading an indication of the nature of its activities as to be likely to cause harm to the public, it may in writing direct theLLC to change its name within such period (being not less than 1 month) as theCRO may specify.(4) TheLLC may, within 3 weeks from the date of any direction under Article 39(1), (2) or (3), apply to theRegulatory Tribunal to set it aside and theRegulatory Tribunal may set the direction aside or confirm it and, if it confirms it, shall specify the period within which it must be complied with.(5) Where a direction has been given under Article 39(1), (2) or (3) specifying a period within which anLLC is to change its name, theCRO may at any time before that period ends extend it by a further direction in writing.Amended (as from 5th April 2015). Article 40 - Improper use of "Limited Liability Company"
(1) If any person carries on aBusiness under a name or title which includes in the last words(A) the expression "Limited Liability Company"; or(B) any contraction or imitation of that expressionthat person, unless anLLC or aBranch of aNon-QFC Company whose corporate name includes the words "limited liability company" or an abbreviation thereof, contravenes theseRegulations .Article 41 - Similarity of names
In determining for the purpose of this Section 4 whether one name is the same as another there are to be disregarded:
(1) the definite article as the first word of either name;(2) any of the following at the end of the names:(A) "limited liability company";(B) "company";(C) "limited";(D) "unlimited";(E) "limited partnership";(F) "limited liability partnership";(G) "partnership"; and,(H) and any abbreviation thereof;(3) type and case of letters, accents, spaces between letters and punctuation marks; and(4) "and" and "&" are to be taken as the same.Section 5: Section 5: Registered Office
Article 42 - Situation of registered office
(1) AnLLC shall:(A) at all times have a registered office situated in theQFC ; and(B) carry on its principalBusiness activity at or from the registered office unless theQFC Authority permits suchBusiness activity to be carried on at or from another place within theQFC .(2) On the incorporation of anLLC the situation of its registered office shall be that stated in the incorporation document.(3) ADocument may be served on anLLC by leaving it at, or sending it by hand or by fax or by courier to, the registered office of theLLC .Article 43 - Change of registered office
(1) AnLLC may change its registered office by delivering notice of the change within 21 days to theCRO together with payment of thePrescribed Fee .(2) A notice delivered under Article 43(1):(A) shall be in thePrescribed Form ; and(B) shall be signed by a director or secretary of theLLC or authenticated in a manner approved by theCRO .(3) Where theCRO receives a notice under Article 43(1) it shall enter the new registered office on the register in place of the former registered office.(4) The change of registered office shall take effect upon the notice of change of registered office delivered to theCRO in accordance with Article 43(2) being registered by theCRO , but until the end of the period of 21 days beginning with the date on which it is registered a person may validly serve anyDocument on theLLC at its previous registered office.(5) Where anLLC unavoidably ceases to perform at its registered office any duty to keep at its registered office any register, index or otherDocument or to mention the address of its registered office in anyDocument in circumstances in which it was not practicable to give prior notice to theCRO of a change in the situation of the registered office, but:(A) resumes performance of that duty at other premises as soon as practicable; and(B) gives notice accordingly to theCRO of a change in the situation of its registered office within 21 days of doing soit shall not be treated as having failed to comply with that duty.Amended by QFCA RM2012-1 (as from 11th April 2012) Section 6: Section 6: Formalities of Carrying on Business
Article 44 - Requirement to keep internal Company registers
(1) EveryLLC shall keep the following internal registers at its registered office address:(A) Register ofMembers as provided for in Article 19(6);(B) Register of directors and secretary, includingName ,Address , nationality, date of birth and business occupation;(C) Register of transfers ofShares , includingName andAddress of transferor and transferee, date of transfer and number and class ofShares transferred; and(D) Register of allotments ofShares , includingName of applicant, date of application and allotment and number and class ofShares .For an LLC (Public), a record of transfer or title to any shares in the LLC (Public) held in the QSE or the relevant exchange's registry or system will be the definitive register of transfers and register ofMembers ..(2) AnyMember may without charge, and any other person may upon payment of any reasonable fee required by theLLC , visit the registered office during the office hours of theLLC in order to inspect the registers referred to in Article 44(1).(3) For an LLC (Public), on such notice as is reasonably required for the LLC (Public) to obtain the registers from the QSE or other exchange, anyMember may without charge, and any person may upon payment of any reasonable fee required by the LLC (Public), visit the registered office during the office hours of the LLC (Public) in order to inspect the registers referred to in Article 44(1)(A) and Article 44(1)(C).Amended (as from 5th April 2015). Article 45 - Name to appear outside place of Business
(1) EveryLLC shall paint or affix, and keep painted or affixed, its name on the outside of every office or place in which itsBusiness is carried on, in a conspicuous position and in letters easily legible.(2) If anLLC does not paint or affix, and keep painted or affixed, its name as required above, theLLC and everyOfficer of it who is in default is in contravention of theseRegulations .Article 46 - Disclosures required of an LLC in the use of its name
(1) The name of anLLC , its registered number, and the address of its registered office shall appear in legible characters in all itsBusiness letters, written orders for goods or services, invoices and receipts, written demands for payment and other such similar Documentation.(2) If anOfficer of anLLC or a person on its behalf:(A) issues or authorises the issue of anyBusiness letter of theLLC , or anyDocument mentioned in Article 46(1), in which theLLC's name is not so mentioned as required by Article 46(1); or(B) signs or authorises to be signed on behalf of theLLC any bill of exchange, promissory note, endorsement, cheque or order for money or goods in which theLLC's name is not mentioned as required by Article 46(1)he is in contravention of theseRegulations and he is further personally liable to the holder of any such bill of exchange, promissory note, cheque or order for money or goods for the amount of it (unless it is duly paid by theLLC ).Section 7: Section 7: Annual Return
Article 47 - Duty to deliver annual returns
(1) EveryLLC shall deliver to theCRO successive annual returns each of which is made up to a date not later than the date which is from time to time the "return date" of theLLC , that is:(A) the anniversary of the incorporation of theLLC ; or(B) if the last return delivered by theLLC in accordance with this Article 47 was made up to a different date, the anniversary of that date.(2) Each annual return shall:(A) be in thePrescribed Form ;(B) contain the information required by Article 48;(C) be signed by a director or secretary of theLLC ; and(D) be delivered to theCRO together with payment of thePrescribed Fee .(3) If anLLC fails to deliver an annual return in accordance with this Article 47 before the end of the period of 28 days after the return date, theLLC shall be in contravention of theseRegulations . The contravention continues until such time as an annual return made up to that return date and complying with the requirements of Article 47(2) (except as to date of delivery) is delivered by theLLC to theCRO .(4) Where anLLC is in contravention of theseRegulations under Article 47(3) every director of theLLC is similarly liable unless he shows that he took all reasonable steps to avoid the commission of or the continuance of the contravention of theseRegulations .(5) This Article does not apply to anLLC that is aCollective Investment Fund .Amended (as from 5th April 2015). Article 48 - Contents of annual return
Every annual return shall state the date to which it is made up and shall contain the following information:
(1) In respect of each class ofMembers , theName andAddress of eachMember of theLLC holding more than 1% in nominal value of all the issued shares of that class;(2) theName ,Address , nationality, date of birth andBusiness occupation of each of the directors and the secretary of theLLC ;(3) the registered office of theLLC ;(4) the authorised and issued share capital of theLLC ;(5) the principalBusiness activities of theLLC in the year in question;(6) theName andAddress of the auditor of theLLC ; and(7) any other information as may be prescribed by theCRO .Amended (as from 5th April 2015). Section 8: Section 8: Articles of Association
Article 49 - Standard articles of association
(1) TheCRO may from time to time prescribe a set of model articles of association (which shall be in the English language) to be known as the standardLLC articles of association.(2) If theCRO prescribes standard articles of association, anLLC may, by reference, adopt for its articles of association the whole of the standard articles of association or may, by reference, adopt for its articles of association the standard articles of association subject to such amendments as may be set out in its articles of association or may incorporate by reference in its articles of association such parts of the model articles of association as it shall deem fit.(3) If the standard articles of association are altered by theCRO , the alteration will not affect the articles of association of anLLC registered before the alteration takes effect.Article 50 - Alteration of articles of association
(1) AnLLC may bySpecial Resolution alter the provisions of its articles of association.(2) Alterations so made to the articles of association shall have effect from the time of the passing of theSpecial Resolution or such later time as shall be specified in it.(3) Any alteration to the articles of association must be registered on thePrescribed Form , accompanied by the payment of thePrescribed Fee , with theCRO within 21 days of theSpecial Resolution to alter it being passed by theMembers .Amended by QFCA RM2012-1 (as from 11th April 2012) Article 51 - Articles binding on LLC and Members
(1) Subject to the provisions of theseRegulations , the articles of association when registered with theCRO bind anLLC and itsMembers to the same extent as if they had been executed by theLLC and by eachMember , and contained covenants on the part of theLLC and eachMember to observe all the provisions of the articles of association.(2) AMember of anLLC is not bound by an alteration made in the articles of association after the date on which he became aMember , if and so far as the alteration:(A) requires him to take or subscribe for moreShares than the number held by him at the date on which the alteration is made; or(B) in any way increases his liability as at that date to contribute to theLLC's share capital or otherwise pay money to theLLC .(3) AnLLC shall, upon request by aMember , send suchMember a copy of its articles of association including all alterations thereto, subject to theMember paying the reasonable cost thereof.Section 9: Section 9: Directors and Secretary
Article 52 - Appointment of directors
(1) AnLLC shall have at least one director.(2) No person shall be a director who:(A) if an individual, is under the age of 18 years;(B) is disqualified from being a director in theQFC or in any other place;(C) is an undischarged bankrupt in any country; or(D) is aBody Corporate , unless—(i) theBody Corporate is anAuthorised Firm ; and(ii) theLLC is aCollective Investment Fund .(3) The first directors of anLLC shall be those named in the incorporation document and thereafter the directors, subject to the provisions of theseRegulations and any otherRegulations , shall be appointed and removed and shall hold and vacate office as provided in the articles of association of theLLC .(4) The particulars of each director appointed, removed or who resigns and any change in the particulars of the directors of anLLC from time to time, shall be registered with theCRO in thePrescribed Form and no later than 21 days after such change, together with payment of anyPrescribed Fee . For each director appointed these particulars shall include hisName , date of birth,Address , nationality, business occupation, any directorships held by him or which have been held by him within the last 5 years and shall be accompanied by or include a written declaration signed by the director that he is qualified to act as a director pursuant to theseRegulations .(5) The articles of association of anLLC may provide for a director to appoint an alternate to attend meetings in the absence of the director who appointed him and to vote in his place.Amended (as from 5th April 2015). Article 53 - Removal of directors
(1) Notwithstanding anything in its articles of association or in any agreement between theLLC and the director and without prejudice to any other power to remove a director which may exist apart from this Article 53, anLLC may byOrdinary Resolution at a general meeting remove a director before the expiration of his period of office, provided that notice of any such meeting shall be served on the director concerned not less than 21 days before the meeting and such director shall be entitled to be heard at such meeting.(2) The removal of a director from office by resolution of theMembers of theLLC under Article 53(1) shall be without prejudice to any rights of that director to compensation or damages in respect of the termination of his appointment as director.Article 54 - Powers of directors
The directors of an
LLC may collectively exercise all powers of theLLC in accordance with its articles of association, save to the extent that theseRegulations or any otherRegulations or any rules made by theQFC Authority or theLLC's articles of association require any such powers to be exercised by theMembers of theLLC .Article 55 - Duties of directors
(1) A director of anLLC owes a duty to theLLC to comply with the following provisions of this Article and shall, unless his failure to comply with any such duty shall be approved or ratified by anOrdinary Resolution of theLLC , be liable to compensate theLLC for any loss suffered by theLLC and to account to theLLC for any profit, gain or benefit obtained by the director in consequence of any such failure.(2) A director shall:(A) act honestly and in good faith with a view to the best interests of theLLC ;(B) act in accordance with the articles of association of theLLC and decisions of theLLC taken in accordance with theseRegulations and the articles of association and not delegate any of his powers or fail to exercise his independent judgement in relation to any exercise of his powers, except where authorised by theseRegulations or the articles of association or any such decisions;(C) exercise the care, diligence and skill that a reasonably prudent person with the knowledge, skill and experience which may reasonably be expected of a director in his position and any additional knowledge, skill and experience which he has would exercise in comparable circumstances;(D) not use for his own or anyone else's benefit any property or information of theLLC or any opportunity of theLLC of which he become aware in the performance of his functions as a director; and(E) not accept any benefit from a third party which is conferred because of his position as a director or by reason of his doing or not doing anything as a director, unless the benefit is incidental to the proper performance of his functions as a director or there is no real possibility of the benefit resulting in a conflict of interest on the part of the director.Article 56 - Directors' interests
(1) A director of anLLC who has a direct or indirect interest of which he is aware in a transaction entered into or proposed to be entered into by anLLC or by aSubsidiary of theLLC , shall disclose to the directors of theLLC the nature and extent of his interest.(2) The disclosure required under Article 56(1) shall be made as soon as practicable but no later than 10 days after the director becomes aware of the circumstances from which his duty to make the disclosure arises.(3) An interest solely through a holding of less than 10 percent of the shares in aBody Corporate listed on any stock exchange shall not constitute an interest requiring disclosure under this Article 56.(4) A notice in writing given to theLLC by a director (including a sole director) that he is to be regarded as interested in any transaction with a specified person and specifying the reason why he is to be regarded as so interested is sufficient disclosure of his interest in any such transaction entered into after the notice is given.(5) Where a director fails to disclose an interest of his under this Article 56 the director shall, unless the transaction is confirmed by anOrdinary Resolution at a general meeting of theLLC at which the nature of the director's interest in the transaction was properly disclosed, be liable to account to theLLC for any profit, gain or benefit obtained by the director in connection with the transaction.(6) A sole director of anLLC who is required by this Article 56 to disclose any interest shall record the nature and extent of his interest in writing in a register which shall be kept at theLLC's registered office and shall be made available there for inspection by anyMember and theLLC's auditor without charge during the office hours of theLLC .Amended (as from 5th April 2015). Article 57 - Prohibition of financial assistance to directors
(1) Without the consent of anyMember orMembers holding in the aggregate not less than 90 percent of the total voting rights of all theMembers having the right to vote at any meeting of theMembers it shall not be lawful for anLLC to make a loan or similar form of financial assistance to any person who is its director or a director of itsHolding Company , or to enter into any guarantee or provide security in connection with any financial assistance made to such person as aforesaid by any other person provided that nothing in this Article 57 shall apply to either:(A) subject to Article 57(2) to anything done to provide any such person as aforesaid with funds to meet expenditure incurred or to be incurred by him for the purposes of theLLC or for the purpose of enabling him properly to perform his duties as anOfficer of theLLC ;(B) in the case of anLLC whose ordinaryBusiness includes the lending of money or the giving of guarantees in connection with financial assistances made by other persons, to anything done by theLLC in the ordinary course of thatBusiness ; or(C) any financial assistance prescribed in rules made by theQFC Authority .(2) The proviso stated at Article 57(1)(A) shall not authorise the making of any financial assistance, or the entering into of any guarantee, or the provision of any security, except either:(A) with the prior agreement of theLLC given at a general meeting at which the purposes of the expenditure and the amount of the financial assistance or the extent of the guarantee or security, as the case may be, are disclosed; or(B) on condition that, if the approval of theLLC is not given as aforesaid at or before the next following annual general meeting, the financial assistance shall be repaid or the liability under the guarantee or security shall be discharged, as the case may be, within 6 months from the conclusion of that meeting.(3) Where the approval of theLLC is not given as required by any such condition, the directors authorising the making of the financial assistance, or entering into the guarantee, or the provision of security, shall be jointly and severally liable to indemnify theLLC against any loss arising therefrom.(4) For the purposes of this Article 57 a financial assistance shall not be deemed to have been made in the ordinary course ofBusiness of anLLC if it has not been made on normal commercial terms including in respect of interest rates, repayment terms and security.(5) Financial assistance shall be deemed to be financial assistance to a director if it is made to or in favour of:(A) a spouse or child of a director; or(B) aBody Corporate of which a director or his spouse or child (or any of them together) owns or controls directly or indirectly more than 20 percent of the share capital.Amended (as from 5th April 2015). Article 58 - Payment to directors for loss of office
(1) It is not lawful for anLLC to make to a director of theLLC any payment by way of compensation for loss of office, or as consideration for or in connection with his retirement from office, without particulars of the proposed payment (including its amount) being disclosed toMembers of theLLC and the proposal being approved byOrdinary Resolution . This Article 58 does not affect the ability of anLLC to pay compensation to a director in connection with the termination of his employment by theLLC .(2) Where a payment which is unlawful under this Article 58 is made to a director, he shall be liable to repay it to theLLC , unless and until the provisions of this Article are subsequently complied with.Article 59 - Validity of acts of director
The acts of a director are valid notwithstanding any defect that may afterwards be found in his appointment or qualification.
Article 60 - Appointment of secretary
(1) EveryLLC shall have at all times an appropriately qualified secretary.(2) The first secretary of anLLC shall be the person named in the incorporation document, and after that shall be any person appointed by the directors, including one of their number (except that a sole director cannot also be a secretary). A secretary may be removed by the directors of anLLC or may resign by the submission of a letter of resignation.(3) The particulars of each secretary appointed, removed or who resigns and any change in the particulars of the secretary of anLLC from time to time, shall be registered with theCRO in thePrescribed Form , together with payment of thePrescribed Fee , and within 21 days of such change. For each secretary appointed these particulars shall include hisName , date of birth,Address and nationality and in the case of aBody Corporate its name, registered number and registered office address.Amended (as from 5th April 2015). Article 61 - Exemption, indemnification and liability of Officers
(1) Subject to Article 61(2), anLLC may in its articles of association or in any contract or arrangement between theLLC and anyOfficer , or any person employed by theLLC as auditor, exempt suchOfficer or person from, or indemnify him in respect of any negligence, default, breach of duty or breach of trust of which theOfficer or person may be guilty in relation to theLLC or anySubsidiary thereof.(2) Any provision whether contained in the articles of association of theLLC or in any contract or arrangement between theLLC and anyOfficer , or any person employed by theLLC as auditor, exempting suchOfficer or person from, or indemnifying him against any liability which by virtue of any rule of law would otherwise attach to him in respect of any fraud or dishonesty of which he may be guilty in relation to theLLC shall be void provided that, notwithstanding anything in this Article 61 anLLC may, in pursuance of any such provision as aforesaid, indemnify any suchOfficer or auditor against any liability incurred by him in defending any proceedings, whether civil or criminal in which judgement is given in his favour or in which he is acquitted.Article 62 - Insurance of Officers
An
LLC may purchase and maintain insurance for the benefit of anyOfficer of theLLC against any liability incurred by him in his capacity as anOfficer of theLLC or indemnifying such anOfficer in respect of any loss arising or liability attaching to him by virtue of any rule of law in respect of any negligence, default, breach of duty or breach of trust of which theOfficer may be guilty in relation to theLLC or anySubsidiary thereof and nothing in theseRegulations shall make any such policy void or voidable.Section 10: Section 10: Meetings and Resolutions
Article 63 - General meetings
(1) A meeting of theMembers of anLLC shall be convened at least once in every calendar year (save that provided anLLC shall hold its first annual general meeting within 18 months of its incorporation, it need not hold it in the calendar year of its incorporation or the following calendar year); this meeting shall be referred to as the annual general meeting.(2) The directors may, whenever they think fit, convene a general meeting of theMembers of anLLC or the holders of any class ofShares thereof; all meetings other than annual general meetings shall be called special general meetings.Article 64 - CRO's power to call meeting in default
(1) If a default is made in the holding of a general meeting in accordance with Article 63(1), theCRO may, on the application of anyOfficer orMember of theLLC , call or direct the calling of, a general meeting of theLLC .(2) TheLLC shall comply with any direction of theCRO made under Article 64(1).Article 65 - Requisition of general meetings
(1) Notwithstanding anything in its articles of association, the directors of anLLC shall, on requisition byMembers holding the requisiteShares , proceed to call a special general meeting or as the case may be a meeting of any class ofMembers of theLLC to be held as soon as practicable, but in any case not later than 3 months after the date of requisition.(2) For the purposes of Article 65(1) the "requisiteShares " means not less than 10 percent in nominal value of theShares which at the date of the requisition carry the right to vote at the meeting requisitioned.(3) The requisition shall state the objects of the meeting and must be signed by the requisitionists and be deposited at the registered office of theLLC marked for the attention of the directors. The requisition may consist of severalDocuments in like form signed by one or more requisitionists.(4) If the directors do not, within 21 days from the date of the deposit of the requisition proceed duly to convene a meeting, the requisitionists, or any of them representing more than 50 percent. of the total voting rights of all of them, may themselves convene a meeting, but any meeting so convened shall not be held after the expiration of 3 months from the said date.(5) A meeting convened under this Article 65 shall be convened in the same manner, as nearly possible, as that in which meetings are to be convened by directors.(6) Any reasonable expenses incurred by the requisitionists by reason of the failure of the directors to convene a meeting shall be repaid to the requisitionists by theLLC , and any sum so repaid shall be retained by theLLC out of any sums due or to become due from theLLC by way of fees or other remuneration in respect of their services to such directors as were in default.Amended (as from 5th April 2015). Article 66 - Notice of meetings
(1) Any general meeting of anLLC or a meeting of any class ofMembers of anLLC may, subject to any longer period of notice as may be required by its articles of association, be called by not less than 21 days notice in writing, inclusive of the day on which the notice is given.(2) If a meeting is called by shorter notice than that specified in Article 66(1), it shall be deemed to be duly called if it is so agreed by a majority in number of theMembers having a right to attend and vote at the meeting, together holding not less than 95 percent of the nominal value of theShares of theLLC giving a right to attend and vote at that meeting.(3) A notice of a general meeting of theLLC shall:(A) set out a time and place for the meeting;(B) set out in an agenda the nature of the business of the meeting;(C) if aSpecial Resolution is to be proposed at the meeting set out the intention to propose aSpecial Resolution and attach a copy of the proposedSpecial Resolution to the agenda; and(D) include a copy of any accounts or auditors report if the same is to be laid before the meeting.(4) The accidental omission to give notice of a meeting to, or the non-receipt of a notice of a meeting by, any persons entitled to receive notice shall not invalidate the proceedings of the meeting.Amended (as from 5th April 2015). Article 67 - General provisions as to meetings and votes
(1) The following provisions apply to any meeting of theLLC or of the holders of any class ofShares in theLLC insofar as the articles of association of theLLC do not make other provision in that behalf:(A) notice of every meeting shall be given to everyMember entitled to receive it by delivering it to his registered address, being his address recorded in the register ofMembers or such other address as theMember shall notify to theLLC for delivery of notices from time to time;(B) (save in the case of anLLC having a singleMember ) twoMembers personally present shall be a quorum;(C) anyMember elected by theMembers present at a meeting may be chairman of it; and(D) everyMember has one vote for everyShare held by him.(2) Notwithstanding any provision to the contrary in the articles of association of anLLC which has a singleMember , at any meeting thereof oneMember present in person or by proxy shall be a quorum.Amended (as from 5th April 2015). Article 68 - Proxies
(1) AMember of anLLC entitled to attend and vote at a meeting of it (including a meeting of holders of any class ofShares in it) is entitled to appoint another person (whether aMember or not) as his proxy to attend and vote instead of him and a proxy appointed to attend and vote instead of aMember has the same right as theMember to speak at the meeting.(2) In every notice calling a meeting of anLLC there shall appear with reasonable prominence a statement that aMember entitled to attend and vote is entitled to appoint a proxy or, where that is allowed, one or more proxies to attend and vote instead of him, and that a proxy need not also be aMember .(3) A provision contained in anLLC's articles of association is void insofar as it would have the effect of requiring the appointment of a proxy or anyDocument necessary to show the validity of, or otherwise relating to, the appointment of a proxy, to be received by theLLC or any other person more than 48 hours before a meeting or an adjourned meeting in order that the appointment may be effective.Article 69 - Right to demand a poll
(1) A provision contained in anLLC's articles of association is void insofar as it would have the effect either:(A) of excluding the right to demand a poll at a general meeting, or at a meeting of any class ofMembers , on a question other than the election of the chairman of the meeting or the adjournment of the meeting; or(B) of making ineffective a demand for a poll on any such question which is made either:(i) by not less than fiveMembers having the right to vote on the question;(ii) by aMember orMembers representing not less than 10 percent of the total voting rights of all theMembers having the right to vote on the question; or(iii) by aMember orMembers holding not less than 10 percent in nominal value of theShares in theLLC conferring a right to vote at the meeting.(2) The instrument appointing a proxy to vote at such a meeting is deemed also to confer authority to demand or join in demanding a poll; and for the purposes of Article 69(1) a demand by a person as proxy for aMember is the same as a demand by theMember .(3) On a poll taken at such a meeting, aMember entitled to more than one vote need not, if he votes, use all his votes or cast all the votes he uses in the same way.Amended (as from 5th April 2015). Article 70 - Representation of Entity at meetings
(1) AnEntity may:(A) if it is aMember of anLLC authorise such person as it thinks fit to act as its representative at any meeting of theLLC or at any meeting of any class ofMembers of theLLC ; and(B) if it is a creditor (including a holder of debentures), of anLLC , authorise such person as it thinks fit to act as its representative in any meeting of any creditors of theLLC held in pursuance of theseRegulations or any otherRegulations , or in pursuance of the provisions contained in any debenture or trust deed, as the case may be.(2) A person authorised as aforesaid shall be entitled to exercise the same powers on behalf of theEntity which it represents as thatEntity could exercise as if it were an individualMember , creditor or holder of debentures in theLLC .Article 71 - Circulation of Members' resolution
(1) Subject as provided in this Article, it shall be the duty of anLLC , on the requisition in writing of such number ofMembers as is herein after specified, at the expense of the requisitionists unless theLLC resolves otherwise:(A) to give theMembers of theLLC entitled to receive notice of the next annual general meeting notice of any resolution which may properly be moved and is intended to be moved at that meeting; and(B) to circulate toMembers entitled to have notice of any general meeting sent to them any statement of not more than one thousand words with respect to the matter referred to in any proposed resolution or the business to be dealt with at that meeting.(2) The number ofMembers necessary for requisition under Article 71(1) shall be:(A) either any number ofMembers representing not less than 5 percent. of the total voting rights of all theMembers having at the date of the requisition a right to vote at the meeting to which the requisition relates; or(B) not less than tenMembers .(3) Notice of any such intended resolution shall be given, and any such statement shall be circulated, to theMembers of theLLC entitled to have notice of the meeting sent to them by serving a copy of the resolution on each suchMember in any manner permitted for the service of notice of the meeting, and any notice of such resolution shall be given to any otherMember of theLLC by giving notice of the general effect of the resolution in any manner permitted for giving him notice of meetings of theLLC , provided that the copy shall be served, or notice to the effect of the resolution shall be given, as the case may be, in the same manner, and so far as practicable, at the same time as notice of the meeting and, where it is not practicable for it to be served or given at that time, it shall be served or given as soon as practicable thereafter.Amended (as from 5th April 2015). Article 72 - Conditions to be met before LLC bound to give notice of resolution
(1) AnLLC shall not be bound under Article 71 to give notice of any resolution or circulate any statement unless a copy of the requisition signed by the requisitionists, or two or more copies which between them containing the signatures of all the requisitionists, is deposited at the registered office of theLLC :(A) requiring notice of a resolution, not less than 21 days before the meeting; or(B) in the case of any other requisition, not less than one week before the meeting; andthere is deposited or tendered with the requisition a sum reasonably sufficient to meet theLLC's expenses in giving effect thereto.(2) Provided that if, after a copy of the requisition requiring notice of a resolution has been deposited at the registered office of theLLC , an annual general meeting is called for a date 21 days or less after the copy has been deposited, the copy though not deposited within the time required by this Article 72 shall be deemed to have been properly deposited for the purposes thereof.Article 73 - Resolutions in writing of Members
(1) Anything which may be done by any kind of resolution of a meeting of theMembers of anLLC , or any class thereof, may be effected, without a meeting and without any previous notice being required, by resolution in writing signed by all theMembers entitled at the date of the resolution to attend and vote at such a meeting.(2) Each of the signatures of such written resolution need not be on a singleDocument provided each is on aDocument which accurately states the terms of the resolution.(3) The date of the resolution means the date on which the resolution is signed by or on behalf of the lastMember to sign.(4) A written resolution signed in accordance with this Article is valid and effective as if it was passed at a general meeting of theMembers or at a meeting of the relevant class ofMembers of theLLC .Article 74 - Directors meetings and written resolutions
(1) Save in the case of anLLC with a sole director, meetings of the directors shall be held as often as is necessary for the conduct of the affairs of theLLC .(2) Subject as provided in the articles of association of theLLC , each director shall be entitled to one vote and decisions shall be made by majority vote.(3) A meeting of the directors of anLLC , or any committee thereof, may be effected by a resolution in writing signed by all the directors or all the members of the committee.Article 75 - Participation in meetings
Unless the articles of association of the
LLC provide otherwise, a meeting of directors or a committee of directors or of theMembers or any class thereof may be held by means of such telephone, electronic or other communication facilities as permit all persons participating in the meeting to communicate with each other simultaneously, and instantaneously, and participation in such a meeting shall constitute presence in person at such meeting.Article 76 - Minutes
(1) EveryLLC shall cause minutes of all proceedings at general meetings, meetings of the holders of a class ofShares , meetings of its directors and committees of directors to be entered in books kept for that purpose.(2) Any such minute, if purporting to be signed by the chairman of the meeting at which the proceedings took place, or by the chairman of the next succeeding meeting, is evidence of the proceedings.(3) Where minutes have been made in accordance with this Article 76 then, until the contrary is proved, the meeting is deemed duly held and convened, and all proceedings which took place at the meeting to have duly taken place.(4) Where a decision of theMembers , or any class thereof, or of the directors, is effected by a resolution in writing or decision of a soleMember or director in accordance with theseRegulations , theLLC shall cause a record of the resolution or decision and of the signatures thereon to be entered in the relevant minute book in the same way as minutes of the proceedings at the relevant type of meeting.(5) The books containing the minutes of a general meeting or of a meeting of the holders of a class ofShares or a meeting of the directors shall be kept at theLLC's registered office, and shall during business hours be open to examination by aMember without charge.Article 77 - Filing of resolutions
(1) A copy of every resolution or agreement to which this Article 77 applies shall within 21 days after it is passed or made, be registered with theCRO on thePrescribed Form .(2) This Article applies to:(A)Special Resolutions of anLLC ;(B) a resolution of anLLC removing a director from office;(C) resolutions of theMembers of anLLC or resolutions of a soleMember to the extent that these would have beenSpecial Resolutions if passed at a general meeting;(D) a resolution approving the purchase of anLLC's ownShares ;(E) aSpecial Resolution approving a reduction of share capital of anLLC ; and(F) a resolution removing an auditor of anLLC from office.Amended (as from 5th April 2015). Article 78 - Recording of decisions by sole Member
(1) If:(A) anLLC has only oneMember ;(B) theMember takes a decision which may be taken by theLLC in general meeting and has effect as if agreed by theLLC in general meeting; and(C) the decision is not taken by way of resolution in writingtheMember shall provide theLLC with a record in writing of the decision.(2) Failure to comply with Article 78(1) shall not affect the validity of the decision.Section 11: Section 11: Accounting and Audit Requirements
Article 79 - Maintenance of Accounting Records
Every
LLC shall keep proper accountingRecords with respect to all sums of money received and expended by theLLC and all sales and purchases of goods and services and other transactions by theLLC and the assets andLiabilities of theLLC . Such accountingRecords , shall be sufficient to show and explain all transactions by theLLC and must be such as to:(1) disclose with reasonable accuracy the financial position of theLLC at any time; and(2) enable the directors to ensure that any accounts prepared by theLLC comply with the requirements of theseRegulations .Article 80 - Location of Accounting Records
(1) TheLLC's accountingRecords shall be:(A) kept at theLLC's registered office;(B) preserved by theLLC for at least 6 years from the date to which they relate; and(C) at all reasonable times be open to inspection by the directors and auditor of theLLC .(2) If anLLC fails to comply with Article 79 and Article 80(1), theLLC and everyOfficer is in contravention of theseRegulations .Amended (as from 5th April 2015). Article 81 - Financial year of an LLC
(1) The first financial year of anLLC starts from the day on which it is incorporated and lasts for the period ending on the financial year end date specified in the incorporation document falling not less than 6 months and not more than 18 months after incorporation of theLLC .(2) The second and any subsequent financial year shall start with the day immediately following the end of theLLC's previous financial year and end on the financial year end date in the next calendar year.(3) AnLLC may by notice in thePrescribed Form given to theCRO specify a new financial year end date having effect in relation to:(A) theLLC's current financial year and subsequent financial years; or(B) theLLC's previous financial year and all financial years subsequent to that previous financial yearwhere, anLLC's "previous financial year" means that year immediately preceding its current financial year.(4) The notice shall state whether the current or previous financial year:(A) is to be shortened, so as to come to an end on the first occasion on which the new financial year end date falls or fell after the beginning of the financial year; or(B) is to be extended, so as to come to an end on the second occasion on which that date falls or fell after the beginning of the year.(5) A notice under Article 81(3), stating that the current or previous financial year is to be extended is ineffective, if given less than 5 years after the end of an earlier financial year of theLLC which was extended by virtue of this Article.(6) A notice under Article 81(3) may not be given in respect of a previous financial year if the period allowed for laying and delivering accounts in relation to that year has already expired.(7) AnLLC's financial year shall not, in any case, be extended so as to exceed 18 months and a notice under Article 81(3) is ineffective if the current or previous financial year as extended in accordance with the notice would exceed that limit.Amended (as from 5th April 2015). Article 82 - LLC accounts
(1) The directors of everyLLC shall cause accounts to be prepared in relation to each financial year of theLLC which shall be in the English language and shall comprise or include:(A) financial statements set out in accordance withIFRS ,UK GAAP ,US GAAP or such other accounting principles and standards as may be prescribed in rules made by theQFC Authority ; and(B) such further information as may be required by theseRegulations , any rules made by theQFC Authority and theLLC's articles of association.(2) The accounts shall be prepared in accordance with accounting principles and standards prescribed in rules made by theQFC Authority and comply with any other requirements of theseRegulations or any rules made by theQFC Authority . The accounts shall show a true and fair view of the profit or loss of theLLC for the financial year in question and of the state of theLLC's affairs at the end of such financial year.(3) TheLLC's accounts shall be approved by the directors and signed on their behalf by at least one of their number.(4) Within 4 months of the end of the financial year the accounts for that year shall be:(A) prepared and approved by the directors;(B) examined and reported on by theLLC's auditors in accordance with theseRegulations and any rules made by theQFC Authority , such auditors' report to be written in the English language; and(C) laid before a meeting of theMembers together with a copy of the auditors' report.(5) TheLLC shall file with theCRO within 21 days after the meeting of theMembers before which the accounts and auditor's report were laid, a copy of the accounts and auditor's report.(6) In this Section 11, reference to "accounts" are to those accounts prepared in accordance with this Article.(7) This Article does not apply to anLLC that is aCollective Investment Fund .Amended (as from 5th April 2015). Article 83 - Provision of copy of accounts to Members
(1) AnyMember of anLLC is entitled, on demand and without charge, to be furnished with a copy of theLLC's latest audited accounts and auditor's report.(2) AnLLC shall comply with such a request within 7 days.(3) If anLLC fails to comply with Article 83(2), theLLC and everyOfficer is in contravention of theseRegulations .Amended (as from 5th April 2015). Article 84 - Publication of accounts
Any accounts published by an
LLC must be audited and a copy of the auditors' report must accompany the published accounts.Article 85 - Qualification of auditor
(1) AnLLC's auditor shall be an individual auditor or firm of auditors qualified to act as auditors in theQFC and approved by theQFC Authority to act as auditors forLLCs and otherCompanies and otherEntities incorporated or registered in theQFC and entered in a register of approved auditors which shall be maintained by theCRO .(2) An auditor shall be regarded as qualified and approved by theQFC Authority to act as an auditor in theQFC and shall be entitled to be entered in the register maintained by theCRO if that auditor meets the criteria for approval set out in rules made by theQFC Authority .(3) Entry of an auditor or firm of auditors in the register of auditors shall be without prejudice to any rules concerning auditors made by theRegulatory Authority pursuant to theFinancial Services Regulations .Article 86 - Appointment and removal of auditor
(1) AnLLC shall appoint one or more auditors or a firm of auditors who shall examine and report on theLLC's accounts in accordance with theseRegulations . Except as provided for in Article 86(6) and Article 88(4) theLLC shall give notice in writing to theCRO within 21 days of the first appointment and any subsequent change in auditor on thePrescribed Form together with thePrescribed Fee .(2) No person shall be appointed as auditor of anLLC who is anOfficer or employee of thatLLC or of anAffiliated Company or who is a partner, employer or employee of any suchOfficer or employee.(3) The directors of anLLC shall appoint the auditor of thatLLC for its first financial year. In subsequent financial years, anLLC shall at its annual general meeting appoint an auditor to hold office from the conclusion of that meeting to the conclusion of the next annual general meeting. The directors or theMembers of theLLC in general meeting may fill any vacancy in the office of auditor. While such a vacancy continues, any surviving or continuing auditor may continue to act.(4) Where for any reason no auditor is appointed, theCRO may, on the application of anyMember , appoint one or more auditors to hold office until the close of the next annual general meeting.(5) Notwithstanding any agreement but without prejudice to the auditors' rights to compensation or damages, any auditor of anLLC may be removed by anOrdinary Resolution .(6) TheLLC shall as soon as reasonably practicable and in any event not later than 5 days after the passing of theOrdinary Resolution referred to in Article 86(5) file a copy of theOrdinary Resolution with theCRO in thePrescribed Form together with thePrescribed Fee and if anAuthorised Firm with theRegulatory Authority .Amended (as from 5th April 2015). Article 87 - Remuneration of auditor
(1) The remuneration of an auditor of anLLC appointed by theMembers shall be fixed by theMembers in general meeting or by the directors, if they are authorised to do so by theMembers , and the remuneration of the auditor appointed by the directors shall be fixed by the directors.(2) Where one or more auditors are appointed by theCRO under Article 86, theCRO shall also fix the remuneration to be paid by theLLC for its or their services.(3) There shall be stated in a note to anLLC's audited accounts the amount of the remuneration of theLLC's auditors in their capacity as such.Article 88 - Resignation of an auditor
(1) An auditor of anLLC may resign from office by depositing a notice in writing to that effect at theLLC's registered office, and any such notice operates to bring his term of office to an end on the date on which the notice is deposited, or on such later date as may be specified in it.(2) When an auditor ceases for any reason to hold office the auditor shall deposit at theLLC's registered office:(A) a statement of any circumstances connected with his ceasing to hold office which he considers should be brought to the notice of theMembers or creditors of theLLC ; or(B) if he considers that there are no such circumstances a statement that there are none.(3) Where a statement under this Article 88 falls within Article 88(2)(A), theLLC shall within 21 days send a copy of the statement to each director andMember of theLLC .(4) TheLLC shall as soon as reasonably practicable and in any event not later than 5 days after the deposit of notice of resignation at its registered office file a copy of the notice with theCRO in thePrescribed Form together with thePrescribed Fee and if anAuthorised Firm with theRegulatory Authority .Amended (as from 5th April 2015). Article 89 - Auditor's report to LLC
(1) AnLLC's auditor shall make a report to theLLC's Members on the accounts examined by the auditor.(2) The auditor's report shall state:(A) whether in the auditor's opinion the accounts have been properly prepared in accordance with theseRegulations ;(B) in particular, whether the accounts have been prepared in accordance with accounting principles and standards referred to in Article 82(2); and(C) any other matter or opinion required under theseRegulations or rules made by theRegulatory Authority under theFinancial Services Regulations .Article 90 - Powers and duties of auditor
(1) AnLLC's auditor shall, in preparing a report in relation to the accounts of theLLC , carry out such investigations as will enable the auditor to form an opinion as to the following matters:(A) whether proper accountingRecords have been kept by theCompany and proper returns adequate for the audit have been received from offices or branches of theLLC not visited by the auditor;(B) whether theLLC's accounts are in agreement with such accountingRecords and returns; and(C) whether theLLC's accounts have been prepared in compliance with applicable accounting principles and standards.(2) If the auditor is of the opinion that proper accountingRecords have not been kept, or that proper returns adequate for the audit have not been received from offices or branches not visited by the auditor, or if the accounts are not in agreement with the accountingRecords and returns, or that the accounts do not comply with accounting principles and standards, the auditor shall state that fact in his report under Article 89.(3) The auditor shall have a right of access at all reasonable times to anLLC's accounting and other books andRecords and is entitled to require from anLLC's Officers such information or explanation that the auditor considers necessary for the performance of his duties.(4) If the auditor fails to obtain all the information and explanations which, to the best of the auditor's knowledge and belief, are necessary for the purposes of the audit, the auditor shall state that fact in his report under Article 89.(5) Every auditor is entitled to receive notice of, and attend, any meeting ofMembers and to be heard on any part of the business of the meeting which concerns the auditor.Article 91 - Auditor's right to information
An
LLC , and anyMember ,Officer , employee or agent of theLLC , shall not knowingly or recklessly make to theLLC's auditor a statement (whether written or oral) which conveys or purports to convey any information or explanation which the auditor requires, or is entitled to require, as auditor of theLLC and is false, misleading or deceptive in a material particular.Article 92 - Obstruction of auditor
(1) AnLLC , or anyOfficer of anLLC , or any person acting under the direction or authority of such anLLC orOfficer , shall not engage in conduct, including without limitation the:(A) destruction or concealment ofDocuments ;(B) coercion, manipulation, misleading, or influencing of the auditor;(C) failure to provide access to information orDocuments specified by the auditor; or(D) failure to give any information or explanation which the person is able to givewhere theLLC ,Officer or other person knows or ought to have known that such conduct could, if successful, have the effect referred to in Article 92(2).(2) For the purposes of Article 92(1), the effect referred to in this paragraph is:(A) to obstruct the auditor in the exercise of any powers under this Part 3; or(B) to result in the rendering of the accounts of theLLC or the auditor's report materially misleading.Part 3A: Companies Limited by Guarantee
Section 1: Establishment and Corporate Capacity
Article 92A - Companies Limited by Guarantee
(1) A form of legal entity known as aCompany limited by guarantee ("LLC(G)") may be incorporated in theQFC .(2) An LLC(G) is aCompany which is formed by being incorporated under Part 3A of theseRegulations .(3) ACompany cannot be formed as, or become, an LLC(G) with a share capital.Inserted (as from 5th April 2015). Article 92B - Corporate capacity
(1) An LLC(G) has separate legal personality from itsMembers whose liability shall be limited to such amount as theMembers undertake to contribute to the assets of the LLC(G) in the event of its being wound up.(2) The QFCA may prescribe by Rules the terms and the minimum value of any undertaking to be given byMembers , or any class ofMembers .(3) An LLC(G) has the capacity, rights and privileges of a natural person and, without limitation, may enter into contracts, sue and be sued and own assets of all types.(4) In favour of a person who in good faith is a party to any transaction or other act to which the LLC(G) is party, the power of the directors of an LLC(G) to bind the LLC(G), or authorise others to do so, shall be deemed free of any limitation under the LLC(G)'s articles of association.(5) A contract may be made, varied or discharged on behalf of an LLC(G), by any person acting under its authority, express or implied.(6) ADocument is executed by an LLC(G) if signed by two directors, or one director and the secretary of an LLC(G), and expressed (in whatever form of words) to be executed by the LLC(G).Inserted (as from 5th April 2015). Article 92C - Transactions entered into prior to corporate existence
Article 16 shall apply to an LLC(G) save that references therein to a Limited Liability
Company or LLC shall be taken as references to an LLC(G).Inserted (as from 5th April 2015). Section 2: Section 2: Incorporation and Registration
Article 92D - Incorporation of an LLC(G)
(1) Any one or more persons may apply for the incorporation of an LLC(G) for the purpose of carrying on activities in or from theQFC by signing and filing with theCRO an incorporation document together with thePrescribed Fee and otherwise complying with the requirements of theseRegulations in respect of registration.(2) ThePrescribed Form and incorporation document filed with theCRO shall set out or have attached thereto:(A) the name of the LLC(G) which must comply with Article 36 of theseRegulations ;(B) the nature of the activities to be conducted by the LLC(G) and it shall be sufficient to state that, subject to the terms of its licence, the purpose of the LLC(G) is to engage in any lawful act or activity for which an LLC(G)s may be incorporated under theQFC Law andRegulations ;(C) the address of the registered office of the LLC(G), which shall be in theQFC ;(D) the date of the financial year end of the LLC(G);(E) the fullName andAddress of each of the incorporators of the LLC(G);(F) a statement of the fact that the liability of theMembers is to be limited by guarantee;(G) a statement of guarantee, which must:—(1) contain such information as may be prescribed for the purpose of identifying the subscribers to the memorandum of association;(2) state that eachMember undertakes that, if the LLC(G) is wound up while he is aMember or within 1 year after he ceases to be aMember , he will contribute to the assets of the LLC(G) such amount as may be required for:-(a) payment of the debts and liabilities of the LLC(G) contracted before he ceases to be aMember ;(b) payment of the costs, charges and expenses of winding up; and(c) adjustment of the rights of the contributories among themselves not exceeding a specified amount;(3) state that eachMember's undertaking is governed by and shall be construed in accordance with theQFC Law andRegulations ; and.(4) state that theMembers submit all disputes arising out of or in connection with their undertaking to the exclusive jurisdiction of theQFC Civil and Commercial Court .(H) the full name, address, date of birth, nationality, Business occupation and any directorships held within the last 5 years of all the persons who are to be the first directors of the LLC(G) together with a declaration that each of them is qualified to act as a director or secretary of an LLC(G) pursuant to theseRegulations ;(I) the fullName ,Address , date of birth and nationality of the person who is the first secretary of the LLC(G);(J) the LLC(G)'s articles of association, signed by the incorporators, setting out the rules for the internal governance of the LLC(G) which shall comply with theseRegulations ; and(K) such other particulars as theCRO may require from time to time.(3) The incorporation document and all other documentation required to be submitted to theCRO shall be in English and shall be in such form as theCRO may prescribe or approve from time to time.Inserted (as from 5th April 2015). Article 92E - Registration
(1) No LLC(G) shall be incorporated without the consent of theCRO .(2) On incorporation theCRO shall:(A) give a certificate that the LLC(G) is incorporated as an LLC(G)with theName specified in the certificate and with effect from the date of the certificate;(B) allocate to the LLC(G) a number, which shall be the LLC(G)'s registered number; and(C) enter theName and registered number of the LLC(G) in the index ofName s and registered numbers maintained by theCRO under theseRegulations .(3) A certificate of incorporation shall be conclusive evidence that the LLC(G) is incorporated with theName specified in it and that the requirements of theseRegulations have been complied with in respect of the incorporation and registration of the LLC(G) and thereafter no defect in the process prior to the incorporation thereof shall affect the validity of its incorporation.(4) From the date of incorporation, the LLC(G) shall be aBody Corporate having theName contained in the certificate of incorporation and is capable forthwith of exercising all the functions of an incorporated LLC(G).(5) A decision of theCRO refusing to issue a certificate of incorporation may be reviewed consistent with any applicable standards and procedures issued by theQFC Authority for such purpose.Inserted (as from 5th April 2015). Section 3: Section 3: Members
Article 92F - Members
(1) The incorporators of an LLC(G) are deemed to have agreed to becomeMembers of the LLC(G) by signing the incorporationDocument and on incorporation shall be entered as such in the LLC(G)'s register ofMembers (other than any who have died or been dissolved).(2) Every other person who agrees to become a Member of the LLC(G) and whoseName is entered in the register ofMembers , is aMember of the LLC(G).(3) A person may cease to be aMember of an LLC(G) (as well as by death or dissolution) in accordance with the articles of association of the LLC(G).(4) AMember of an LLC(G) can be of any nationality and either a natural person or aBody Corporate .(5) The minimum number ofMembers of an LLC(G) is one.(6) Every LLC(G) shall keep a register ofMembers , together with:(A) theName andAddress of theMembers ;(B) the date on which each person was registered as aMember ;(C) the date at which any person ceased to be aMember ; and(D) in the case of an LLC(G) with different classes ofMember , a statement of the class to which eachMember belongs.Inserted (as from 5th April 2015). Article 92G - Rectification of register of Members
(1) If:(A) theName of a person is, without sufficient reason, not entered in or omitted from an LLC(G)'s register ofMembers ; or(B) there is a failure or unnecessary delay in entering on the register the fact of a person having ceased to be aMember a person aggrieved or aMember of the LLC(G), may apply to theCRO for rectification of the register.(2) TheCRO may refuse the application or may order rectification of the register.(3) Whether or not theCRO exercises its power under Article 92G (2), theQFC Civil and Commercial Court may make one or more of the following orders:(A) on application of theCRO , an order enforcing any orders made by it under this Article 92G;(B) on application of a person aggrieved or aMember of the LLC(G), an order directing theCRO to, or not to order the rectification of the register or to do any act or thing; or(C) on application of a person aggrieved, an order requiring the LLC(G) to pay damages or to do any act or thing.Inserted (as from 5th April 2015). Section 4: Section 4: Names and Change of Names
Article 92H - Registration of Name
(1) The name of an LLC(G) must:(A) be written using letters of the English alphabet or such other characters acceptable to theCRO ; and(B) end with:(i) the expression "Limited Liability Company (Guarantee)"; or(ii) the expression "Company Limited by Guarantee"; or(iii) the abbreviation "llc(g)" or "LLC(G)".(2) An LLC(G) shall not be registered by a name:(A) which includes, other than at the end of the name, either the expression "Limited Liability Company (Guarantee)", Company Limited by Guarantee or either of the abbreviations "llc(g)" or LLC(G)";(B) which is the same as a name appearing on the index of names maintained by theCRO or by the Ministry of Economy and Commerce of the State; or(C) which in the opinion of theCRO is offensive or otherwise undesirable.(3) Except with the approval of theCRO , an LLC(G) shall not be registered by a name which in the opinion of theCRO would be likely to give the impression that it is connected in anyway with theState .Inserted (as from 5th April 2015). Article 92I - Change of name and similarity of names
Articles 37 to 39 and 41 shall apply to an LLC(G) save that references therein to a Limited Liability Company orLLC shall be taken as references to an LLC(G).Inserted (as from 5th April 2015). Article 92J - Improper use of "Limited Liability Company (Guarantee)", "Company Limited By Guarantee" or "LLC(G)"
(1) a person, other than an LLC (G), is in breach of theseRegulations if it carries on any activities under aName or title which includes in the last words:(A) the expression "Limited Liability Company (Guarantee)", "Company Limited by Guarantee" or "LLC(G)"; or(B) any contraction or imitation of that expressionInserted (as from 5th April 2015). Section 5: Section 5: Registered Office and Support Services Provider
Article 92K - Situation of registered office
(1) An LLC(G) shall:—(A) at all times have a registered office situated in theQFC ; and(B) carry on its activities at or from the registered office unless theQFC Authority permits such activities to be carried on at or from another place within theQFC .(2) On the incorporation of an LLC(G) the situation of its registered office shall be that stated in the incorporationDocument .(3) ADocument may be served on an LLC(G) by leaving it at, or sending it by hand to the registered office of the LLC(G).(4) The requirements in 92K(1) may be waived by theCRO in its absolute discretion in such circumstances and on such terms as it sees fit.Inserted (as from 5th April 2015). Article 92L - Change of registered office
Article 43 shall apply to an LLC(G) save that references therein to a Limited Liability Company or
LLC shall be taken as references to an LLC(G).Inserted (as from 5th April 2015). Article 92M - Support Services Provider
(1) An LLC(G), with the approval of theQFC Authority , may appoint aSupport Services Provider to provide it with the following services:(A) management and administrative services;(B) services as a registered agent, director or similar officer;(C) provision of a registered office, place of activity orAddress ; and(D) such other services as may be prescribed from time to time by theQFC Authority .(2) For the purposes of Article 92L of theseRegulations :(A) where theSupport Services Provider of the LLC(G) has a registered office in theQFC , the LLC(G) may use that office as its registered office;(B) where theSupport Services Provider of the LLC(G) does not have a registered office in theQFC , the LLC(G) must itself maintain such an office in theQFC and will be considered to be carrying on its principal activity at that office irrespective of the location of itsSupport Services Provider .(3) Where an LLC(G) elects to appoint aSupport Services Provider , it must notify theCRO , using thePrescribed Form and paying thePrescribed Fee , of any changes concerning itsSupport Services Provider .Inserted (as from 5th April 2015). Section 6: Section 6: Formalities of Carrying on Activities
Article 92N - Requirement to keep internal Company registers
(1) Every LLC(G) shall keep the following internal registers at its registered office address:(A) Register ofMembers as provided for in Article 19(6);(B) Register of directors and secretary, includingName ,Address , nationality, date of birth andBusiness occupation;(C) A copy of the statement of guarantee.(2) AnyMember may without charge, and any other person may upon payment of any reasonable fee required by the LLC(G), visit the registered office during the office hours of the LLC(G) in order to inspect the registers referred to in Article 92N(1).Inserted (as from 5th April 2015). Article 92O - Name to appear outside place of activities
(1) Every LLC(G) shall paint or affix, and keep painted or affixed, its name on the outside of every office or place in which its activities are carried on, in a conspicuous position and in letters easily legible.(2) If an LLC(G) does not paint or affix, and keep painted or affixed, its name as required above, the LLC(G) and everyOfficer of it who is in default is in contravention of theseRegulations .(3) The requirement in Article 92O(1) may be waived by theCRO in its absolute discretion in such circumstances and on such terms as it sees fit.Inserted (as from 5th April 2015). Article 92P - Disclosures required of an LLC(G) in the use of its Name
Article 46 shall apply to an LLC(G) save that references therein to a Limited Liability Company or
LLC shall be taken as references to an LLC(G) and reference toBusiness shall be taken as reference to activities.Inserted (as from 5th April 2015). Section 7: Section 7: Annual Return
Article 92Q - Duty to deliver annual returns
(1) Every LLC(G) shall deliver to theCRO successive annual returns each of which is made up to a date not later than the date which is from time to time the "return date" of the LLC(G), that is:(A) the anniversary of the incorporation of the LLC(G); or(B) if the last return delivered by the LLC(G) in accordance with this Article 92Q was made up to a different date, the anniversary of that date.(2) Each annual return shall:(A) be in thePrescribed Form ;(B) contain the information required by Article 92R;(C) be signed by a director or secretary of the LLC(G); and(D) be delivered to theCRO together with payment of thePrescribed Fee .(3) If an LLC(G) fails to deliver an annual return in accordance with this Article 92Q before the end of the period of 28 days after the return date, the LLC(G) shall be in contravention of theseRegulations . The contravention continues until such time as an annual return made up to that return date and complying with the requirements of Article 92Q(2) (except as to date of delivery) is delivered by the LLC(G) to theCRO .(4) Where an LLC(G) is in contravention of theseRegulations under Article 92Q(3) every director of the LLC(G) is similarly liable unless he shows that he took all reasonable steps to avoid the commission of or the continuance of the contravention of theseRegulations .Inserted (as from 5th April 2015). Article 92R - Contents of annual return
Every annual return of an LLC(G) shall state the date to which it is made up and shall contain the following information:
(1) In respect of each class ofMembers , theName andAddress of eachMember of the LLC(G) and the amount of the undertaking provided by suchMember ;(2) theName ,Address , nationality, date of birth andBusiness occupation of each of the directors and the secretary of the LLC(G);(3) the registered office of the LLC(G);(4) the principal activities of the LLC(G) in the year in question; and(5) any other information as may be prescribed by theCRO .Inserted (as from 5th April 2015). Section 8: Section 8: Articles of Association
Article 92S - Standard articles of association
(1) The articles of association of an LLC(G) must(A) provide that the LLC(G) shall not carry on any activities of the type described in Paragraphs 1 to 9 of Schedule 3 to theQFC Law in or from theQFC by way ofBusiness pursuant to the relevant provisions of the FSR; and(B) contain any further statement as to the activities of the LLC(G) as theCRO may require in its absolute discretion.(2) TheCRO may from time to time prescribe a set of model articles of association (which shall be in the English language) to be known as the standard LLC(G) articles of association.(3) If theCRO prescribes standard articles of association, an LLC(G) may subject to Article 92S(1) of theseRegulations , by reference, adopt for its articles of association the whole of the standard articles of association or may, by reference, adopt for its articles of association the standard articles of association subject to such amendments as may be set out in its articles of association or may incorporate by reference in its articles of association such parts of the model articles of association as it shall deem fit.(4) If the standard articles of association are altered by theCRO , the alteration will not affect the articles of association of an LLC(G) registered before the alteration takes effect.Inserted (as from 5th April 2015). Article 92T - Alteration of articles of association
(1) An LLC(G) may bySpecial Resolution alter the provisions of its articles of association, provided that such amended articles of association continue to comply with Article 92S(1).(2) Alterations so made to the articles of association shall have effect from the time of the passing of theSpecial Resolution or such later time as shall be specified in it.(3) Any alteration to the articles of association must be registered on thePrescribed Form , accompanied by the payment of thePrescribed Fee , with theCRO within 21 days of theSpecial Resolution to alter it being passed by theMembers .Inserted (as from 5th April 2015). Article 92U - Articles binding on LLC(G) and Members
(1) Subject to the provisions of theseRegulations , the articles of association when registered with theCRO bind an LLC(G) and itsMembers to the same extent as if they had been executed by the LLC(G) and by eachMember , and contained covenants on the part of the LLC(G) and eachMember to observe all the provisions of the articles of association.(2) AMember of an LLC(G) is not bound by an alteration made in the articles of association after the date on which he became aMember , if and so far as the alteration would in any way increase his liability as at that date under his undertaking to the LLC(G) or otherwise require him to pay money to the LLC(G), save where theMember agrees in writing, either before or after the alteration is made, to be bound by the alteration.(3) An LLC(G) shall, upon request by aMember , send suchMember a copy of its articles of association including all alterations thereto, subject to theMember paying the reasonable cost thereof.Inserted (as from 5th April 2015). Section 9: Section 9: Directors and Secretary
Article 92V - Directors and Secretary of an LLC(G)
Articles 52 to 56 and 58 to 62 shall apply to an LLC(G) save that references therein to a Limited Liability Company or
LLC shall be taken as references to an LLC(G).Inserted (as from 5th April 2015). Article 92W - Prohibition of financial assistance to directors
(1) It shall not be lawful for an LLC(G) to make a loan or similar form of financial assistance to any person who is its director or a director of itsHolding Company , or to enter into any guarantee or provide security in connection with any financial assistance made to such person as aforesaid by any other person, provided that nothing in this Article 92W shall apply to anything done to provide any such person as aforesaid with funds to meet expenditure incurred or to be incurred by him for the purposes of the LLC(G) or for the purpose of enabling him properly to perform his duties as anOfficer of the LLC(G).(2) Financial assistance shall be deemed to be financial assistance to a director if it is made to or in favour of:(A) a spouse or child of a director; or(B) aBody Corporate of which a director or his spouse or child (or any of them together) owns or controls directly or indirectly more than 20 percent of the share capital.Inserted (as from 5th April 2015). Section 10: Section 10: Meetings and Resolutions
Article 92X - Notice of meetings
(1) Any general meeting of an LLC(G) or a meeting of any class ofMembers of an LLC(G) may, subject to any longer period of notice as may be required by its articles of association, be called by not less than 21 days' notice in writing, inclusive of the day on which the notice is given.(2) If a meeting is called by shorter notice than that specified in Article 92X(1), it shall be deemed to be duly called if it is so agreed by a majority in number of theMembers having a right to attend and vote at the meeting.(3) A notice of a general meeting of the LLC(G) shall:(A) set out a time and place for the meeting;(B) set out in an agenda the nature of the business of the meeting;(C) if aSpecial Resolution is to be proposed at the meeting set out the intention to propose aSpecial Resolution and attach a copy of the proposedSpecial Resolution to the agenda; and(D) include a copy of any accounts or auditors report if the same is to be laid before the meeting.(4) The accidental omission to give notice of a meeting to, or the non-receipt of a notice of a meeting by, any persons entitled to receive notice shall not invalidate the proceedings of the meeting.Inserted (as from 5th April 2015). Article 92Y - General provisions as to meetings and votes
(1) The following provisions apply to any meeting of the LLC(G) or of any particular class of theMembers of the LLC(G) insofar as the articles of association of the LLC(G) do not make other provision in that behalf:(A) notice of every meeting shall be given to everyMember entitled to receive it by delivering it to his registeredAddress , be it hisAddress recorded in the register ofMembers or such otherAddress as theMembers shall notify to the LLC(G) for delivery of notices from time to time;(B) (save in the case of an LLC(G) having a singleMember ) twoMembers personally present shall be a quorum;(C) anyMember elected by theMembers present at a meeting may be chairman of it; and(D) everyMember has one vote.(2) Notwithstanding any provision to the contrary in the articles of association of an LLC(G) which has a singleMember , at any meeting thereof oneMember present in person or by proxy shall be a quorum.Inserted (as from 5th April 2015). Article 92Z - Proxies
(1) AMember of an LLC(G) entitled to attend and vote at its meeting of it is entitled to appoint another person (whether aMember or not) as his proxy to attend and vote instead. A Proxy appointed to attend and vote instead of aMember has the same right as theMember to speak at the meeting.(2) In every notice calling a meeting of an LLC(G) there shall appear with reasonable prominence a statement that aMember entitled to attend and vote is entitled to appoint a proxy or, where that is allowed, one or more proxies to attend and vote instead of him, and that a proxy need not also be aMember .(3) A provision contained in an LLC(G)'s articles of association is void insofar as it would have the effect of requiring the appointment of a proxy or anyDocument necessary to show the validity of, or otherwise relating to, the appointment of a proxy, to be received by the LLC(G) or any other person more than 48 hours before a meeting or an adjourned meeting in order that the appointment may be effective.Inserted (as from 5th April 2015). Article 92AA - Representation of Entity at meetings
(1) AnEntity may:(A) if it is aMember of an LLC(G) authorise such person as it thinks fit to act as its representative at any meeting of the LLC(G) or at any meeting of any class ofMembers of the LLC(G); and(B) if it is a creditor, of an LLC(G), authorise such person as it thinks fit to act as its representative in any meeting of any creditors of the LLC(G) held in pursuance of theseRegulations or any otherRegulations .(2) A person authorised as aforesaid shall be entitled to exercise the same powers on behalf of theEntity which it represents as thatEntity could exercise as if it were an individualMember , or creditor of the LLC(G).Inserted (as from 5th April 2015). Article 92BB - Resolutions in writing of Members
Article 73 shall apply to an LLC(G) save that references therein to a Limited Liability Company or
LLC shall be taken as references to an LLC(G).Inserted (as from 5th April 2015). Article 92CC - Directors meetings and written resolutions
Article 74 shall apply to an LLC(G) save that references therein to a Limited Liability Company or
LLC shall be taken as references to an LLC(G).Inserted (as from 5th April 2015). Article 92DD - Participation in meetings
Article 75 shall apply to an LLC(G) save that references therein to a Limited Liability Company or
LLC shall be taken as references to an LLC(G).Inserted (as from 5th April 2015). Article 92EE - Minutes
(1) Every LLC(G) shall cause minutes of all proceedings at general meetings, meetings of its directors and committees of directors to be entered in books kept for that purpose.(2) Any such minute, if purporting to be signed by the chairman of the meeting at which the proceedings took place, or by the chairman of the next succeeding meeting, is evidence of the proceedings.(3) Where minutes have been made in accordance with this Article 92EE then, until the contrary is proved, the meeting is deemed duly held and convened, and all proceedings which took place at the meeting to have duly taken place.(4) Where a decision of theMembers , or any class thereof, or of the directors, is effected by a resolution in writing or decision of a soleMember or director in accordance with theseRegulations , the LLC(G) shall cause a record of the resolution or decision and of the signatures thereon to be entered in the relevant minute book in the same way as minutes of the proceedings at the relevant type of meeting.(5) The books containing the minutes of a general meeting or a meeting of the directors shall be kept at the LLC(G)'s registered office, and shall during business hours be open to examination by aMember without charge.Inserted (as from 5th April 2015). Article 92FF - Filing of resolutions
(1) A copy of every resolution or agreement to which this Article 92FF applies shall within 21 days after it is passed or made, be forwarded to theCRO , together with anyPrescribed Fee , and recorded by it; and it must be either a printed copy or else a copy in some other form approved by theCRO .(2) This Article applies to:(A)Special Resolutions of an LLC(G);(B) a resolution of an LLC(G) removing a director from office; and(C) resolutions of theMembers of an LLC(G) or resolutions of a soleMember to the extent that these would have beenSpecial Resolutions if passed at a general meeting.Inserted (as from 5th April 2015). Article 92GG - Recording of decisions by sole Member
Article 78 shall apply to an LLC(G) save that references therein to a Limited Liability Company or
LLC shall be taken as references to an LLC(G).Inserted (as from 5th April 2015). Section 11: Section 11: Accounting Requirements
Article 92HH - Accounting and Audit Requirements
(1) Articles 79 to 83 shall apply to an LLC(G) save that references therein to a Limited Liability Company orLLC shall be taken as references to an LLC(G) and any reference to "auditors", "audited accounts" or "audited reports" shall be removed.(2) An LLC(G) is not required to appoint an auditor or have its accounts audited.Inserted (as from 5th April 2015). Part 4: Part 4: Protected Cell Companies
Article 93 - Protected Cell Companies
(1) A form of legal entity known as a protected cell company may be incorporated in theQFC .(2) Subject to the provisions of this Part, aCompany may be:(A) incorporated as aPCC ; or(B) converted, if so authorised by its articles of association and approved by theCRO , into aPCC .(3) For the avoidance of doubt, and notwithstanding that aPCC may have created one or moreCells under this Part:(A) aPCC is a single legal person; and(B) the creation by aPCC of aCell does not create, in respect of thatCell , a legal person separate from thePCC .(4) The provisions of Part 3 of theseRegulations , save as amended or varied by this Part and unless the context requires otherwise, shall apply in relation to aPCC as if references therein to "LLC " were references to "PCC ".Article 94 - Creation of Cells
A
PCC may create one or moreCells for the purpose of segregating and protectingCellular Assets in the manner provided by this Part.Article 95 - Cellular and Non-Cellular Assets
(1) The assets of aPCC shall be eitherCellular Assets orNon-Cellular Assets .(2) It shall be the duty of the directors of aPCC :(A) to keepCellular Assets separate and separately identifiable fromNon-Cellular Assets ; and(B) to keepCellular Assets attributable to eachCell separate and separately identifiable fromCellular Assets attributable to otherCells .(3) TheCellular Assets of aPCC comprise the assets of thePCC attributable to theCells of thePCC .(4) The assets attributable to aCell of aPCC comprise:(A) assets represented by the proceeds ofCell Share Capital and reserves attributable to theCell ; and(B) all other assets attributable to theCell .(5) For the purposes of Article 95(4), the expression "reserves" includes retained earnings, capital reserves and share premiums.(6) TheNon-Cellular Assets of aPCC comprise the assets of thePCC which are notCellular Assets .(7) Notwithstanding the provisions of Article 95(2), the directors of aPCC may cause or permitCellular Assets andNon-Cellular Assets to be held:(A) by or through a nominee; or(B) by aPCC theShares and capital interests of which may beCellular Assets orNon-Cellular Assets , or a combination of both.(8) The duty imposed by Article 95(2) is not breached by reason only that the directors of aPCC cause or permitCellular Assets orNon-Cellular Assets , or a combination of both, to be collectively invested, or collectively managed by an investment manager, provided that the assets in question remain separately identifiable in accordance with Article 95(2).Article 96 - Position of creditors
(1) The rights of creditors of aPCC shall correspond with the liabilities provided for in Article 103.(2) No such creditor shall have any rights other than the rights referred to in this Article 96 and in Articles 97 and 103.(3) There shall be implied (except insofar as the same is expressly excluded in writing) in every transaction entered into by aPCC the following terms:(A) that no party shall seek, whether in any proceedings or by any other means whatsoever or wheresoever, to make or attempt to use anyCellular Assets attributable to anyCell of thePCC to satisfy a liability not attributable to thatCell ;(B) that if any party succeeds by any means whatsoever or wheresoever in using anyCellular Assets attributable to anyCell of thePCC to satisfy a liability not attributable to thatCell , that party shall be liable to thePCC to pay a sum equal to the value of the benefit thereby obtained by him; and(C) that if any party succeeds in seizing or attaching by any means or otherwise levying execution against anyCellular Assets attributable to anyCell of thePCC to satisfy a liability not attributable to thatCell , that party shall hold those assets or their proceeds on trust for thePCC and shall keep those assets or proceeds separate and identifiable as such trust property.(4) All sums recovered by aPCC as a result of any such trust as is described in Article 96(3)(C) shall be credited against any concurrent liability imposed under the implied term set out in Article 96(3)(B).(5) Any asset or sum recovered by aPCC under the implied term set out in Article 96(3)(B) or 96(3)(C) or by any other means whatsoever or wheresoever in the events referred to in those Articles shall, after the deduction or payment of any costs of recovery, be applied by thePCC so as to compensate theCell affected.(6) In the event of anyCellular Assets attributable to aCell of aPCC being taken in execution in respect of a liability not attributable to thatCell , and insofar as such assets or compensation in respect thereof cannot otherwise be restored to theCell affected, thePCC shall:(A) cause or procure its auditor, acting as expert and not as arbitrator, to certify the value of the assets lost by theCell affected; and(B) transfer or pay to theCell affected, from theCellular orNon-Cellular Assets to which the liability was attributable, assets or sums sufficient to restore to theCell affected the value of the assets lost.(7) Where under Article 96(6)(B) aPCC is obliged to make a transfer or payment fromCellular Assets attributable to aCell of thePCC , and those assets are insufficient, thePCC shall so far as possible make up the deficiency from itsNon-Cellular Assets .(8) This Article shall apply toCellular andNon-Cellular Assets of aPCC wherever situated and notwithstanding any statutory provision or rule of law to the contrary.Amended (as from 5th April 2015). Article 97 - Recourse to Cellular Assets by creditors
Without prejudice to the provisions of Articles 96 and 103,
Cellular Assets attributable to aCell of aPCC :(1) shall only be available to the creditors of thePCC who are creditors in respect of thatCell and who are thereby entitled, in conformity with the provisions of this Part, to have recourse to theCellular Assets attributable to thatCell ; and(2) shall be absolutely protected from the creditors of thePCC who are not creditors in respect of thatCell and who accordingly are not entitled to have recourse to theCellular Assets attributable to thatCell .Article 98 - Cell Shares and Share capital
(1) APCC may, in respect of any of itsCells , create and issueShares the proceeds of the issue of which shall be comprised in theCellular Assets attributable to theCell in respect of which theCell Shares were issued.(2) The proceeds of the issue ofShares other thanCell Shares created and issued by aPCC shall be comprised in thePCC's Non-Cellular Assets .(3) APCC may pay a dividend in respect of itsCell Shares .(4) Dividends may be paid in respect ofCell Shares by reference only to theCellular Assets and liabilities, or the profits, attributable to theCell in respect of which theCell Shares were issued; and accordingly, in determining whether or not such a dividend may lawfully be paid, no account need be taken of:(A) the profits and losses, or the assets and liabilities, attributable to any otherCell of thePCC ; or(B) non-cellular profits and losses, or assets and liabilities.Article 99 - Reduction of Cell Share Capital
(1) The provisions of Article 30 shall apply both in relation to aPCC and to one or moreCells of aPCC .(2) In the application of Article 30 to aPCC , references in Article 30 to "LLC " shall be interpreted as references to aPCC or to aCell of aPCC , as the case may be.Article 100 - Name and articles of association of PCC
(1) The name of aPCC shall end in the expression "Protected Cell Company", "PCC " or any cognate expression approved in writing by theCRO .(2) The articles of association of aPCC shall state that it is aPCC .(3) APCC may, in order to comply with Article 100(2), alter its articles of association bySpecial Resolution .(4) Unless and until aPCC has complied with the provisions of this Article 100, it shall be deemed not to be aPCC .(5) EachCell of aPCC shall have its own distinct name or designation.Article 101 - Requirements for a PCC
A
Company may not be incorporated as aPCC , and an existingCompany may not be converted into aPCC , unless:(1) theRegulatory Authority has consented in writing to the incorporation or conversion; and(2) thePCC is, or is to be:(A) anInsurer ; or(B) aCollective Investment Fund .Article 102 - Incorporation of Company as PCC
A person wishing to incorporate a
Company as aPCC shall make an application to theCRO for the incorporation of thePCC in accordance with Part 3 of theseRegulations .Article 103 - Liability of Cellular Assets
(1) Subject to the provisions of Article 103(2), and save to the extent that thePCC may have agreed that a liability shall be the liability solely of thePCC's Non-Cellular Assets , or of theCellular Assets attributable to a particularCell of thePCC , where any liability arises which is attributable to a particularCell of aPCC :(A) theCellular Assets attributable to thatCell shall be primarily used to satisfy the liability;(B) thePCC's Non-Cellular Assets shall be secondarily used to satisfy the liability, provided that theCellular Assets attributable to the relevantCell have been exhausted; and(C) anyCellular Assets not attributable to the relevantCell shall not be used to satisfy the liability.(2) In the case of loss or damage which is attributable to a particularCell of aPCC and which is caused by fraud, the loss or damage shall be the liability solely of thePCC's Non-Cellular Assets , without prejudice to any liability of any person other than thePCC .(3) Any liability not attributable to a particularCell of aPCC shall be the liability solely of thePCC's Non-Cellular Assets .(4) Notwithstanding the above provisions of this section:(A) the liabilities under Article 103(1)(A) of theCellular Assets attributable to a particularCell of aPCC shall abate rateably until the value of the aggregate liabilities equals the value of those assets except that the provisions of this paragraph shall be disregarded in assessing the existence and extent of any secondary liability under Article 103(1)(B); and(B) the liabilities of thePCC's Non-Cellular Assets shall abate rateably until the value of the aggregate liabilities equals the value of those assets.(5) For the avoidance of doubt, aPCC may enter into arm's length transactions in respect of two or more of itsCells giving rise to reciprocal liabilities attributable to suchCells .(6) This Article 103 shall apply to the assets of thePCC wherever situated.Article 104 - Disputes as to liability attributable to Cells
(1) In the event of any dispute as to:(A) whether any right is or is not in respect of a particularCell ;(B) whether any creditor is or is not a creditor in respect of a particularCell ;(C) whether any liability is or is not attributable to a particularCell ; or(D) the amount to which any liability is limitedtheQFC Civil and Commercial Court , on the application of thePCC , and without prejudice to any other right or remedy of any person, may issue a declaration in respect of the matter in dispute.(2) TheQFC Civil and Commercial Court , on hearing an application for a declaration under Article 104(1) may:(A) direct that any person shall be heard on the application;(B) make an interim declaration, or adjourn the hearing, conditionally or unconditionally;(C) make the declaration subject to such terms and conditions as it thinks fit; or(D) direct that the declaration shall be binding upon such persons as may be specified.Amended by QFCA RM2012-1 (as from 11th April 2012) Article 105 - PCC to inform persons they are dealing with PCC
(1) APCC shall prior to transacting with a person:(A) inform any person with whom it transacts that it is aPCC ; and(B) for the purposes of that transaction, identify or specify theCell in respect of which that person is transacting, unless that transaction is not a transaction in respect of a particularCell .(2) If, in contravention of Article 105(1), aPCC :(A) fails to inform a person that he is transacting with aPCC , and that person is otherwise unaware that, and has no reasonable grounds to believe that, he is transacting with aPCC ; or(B) fails to identify or specify theCell in respect of which a person is transacting, and that person is otherwise unaware of, and has no reasonable basis of knowing, whichCell he is transacting with;then, in either such case:(C) the directors shall (notwithstanding any provision to the contrary in thePCC's articles of association or in any contract with thePCC or otherwise) incur personal liability to that person in respect of the transaction; and(D) the directors shall have a right of indemnity against theNon-Cellular Assets of thePCC , unless they were fraudulent, reckless or negligent, or acted in bad faith.(3) Notwithstanding the provisions of Article 105(2)(1), theQFC Civil and Commercial Court may relieve a director of all or part of his personal liability thereunder if he satisfies theQFC Civil and Commercial Court that he ought to be so relieved because:(A) he was not aware of the circumstances giving rise to his liability and, in being not aware, he was neither fraudulent, reckless or negligent, nor acted in bad faith; or(B) he expressly objected, and exercised such rights as he had as a director, whether by way of voting power or otherwise, so as to try to prevent the circumstances giving rise to his liability.(4) Where, pursuant to the provisions of Article 105(3), theQFC Civil and Commercial Court relieves a director of all or part of his personal liability under Article 105(2)(C), theQFC Civil and Commercial Court may order that the liability in question shall instead be met first by any other director or directors whose personal liability is not relieved and thereafter, if necessary, from such of theCellular orNon-Cellular Assets of thePCC as may be specified in the order.(5) Any provision in the articles of association of aPCC , and any other contractual provision under which thePCC may be liable, which purports to indemnify directors in respect of conduct which would otherwise disentitle them to an indemnity againstNon-Cellular Assets by virtue of Article 105(2)(D), shall be void.Amended by QFCA RM2012-1 (as from 11th April 2012) Article 106 - Attribution of Non-Cellular Assets and Liabilities
(1)Liabilities of aPCC not otherwise attributable to any of itsCells shall be discharged from thePCC's Non-Cellular Assets .(2) Income, receipts and other property or rights of or acquired by aPCC not otherwise attributable to anyCell shall be applied to and comprised in thePCC's Non-Cellular Assets .Article 107 - Provisions in relation to winding up of PCC
(1) Notwithstanding any statutory provision or rule of law to the contrary, in the winding up of aPCC (whether compulsory or voluntary or subject to the supervision of theQFC Civil and Commercial Court and whether solvent or insolvent):(A) the assets forming part of the estate shall only be theNon-Cellular Assets ;(B) the winding up shall not terminate any agency, or in any way whatsoever affect the authority or power, of anyOfficer , administrator, servant or agent of thePCC or any other person appointed over thePCC or any of theCellular Assets ; and(C) if and to the extent that any liquidator of thePCC has any dealing with, or has possession custody or control of, any of theCellular Assets , he shall be subject to the duty set out in Article 95(2) as if he were a director.Amended by QFCA RM2012-1 (as from 11th April 2012) Article 108 - Transfer of Cellular Assets from PCC
(1) Subject to the provisions of Article 108(3), theCellular Assets attributable to anyCell of aPCC , but not theNon-Cellular Assets of aPCC , may be transferred to another person, wherever resident or incorporated, and whether or not aPCC .(2) A transfer under Article 108(1) ofCellular Assets attributable to aCell of aPCC shall not of itself entitle creditors of thatPCC to have recourse to the assets of the person to whom theCellular Assets were transferred.(3) No transfer of theCellular Assets attributable to aCell of aPCC may be made except under the authority of, and in accordance with the terms and conditions of, an order of theQFC Civil and Commercial Court under this Article (a "Cell transfer order").(4) TheQFC Civil and Commercial Court shall not make aCell transfer order in relation to aCell of aPCC unless it is satisfied:(A) that the creditors of thePCC entitled to have recourse to theCellular Assets attributable to theCell consent to the transfer; or(B) that those creditors would not be unfairly prejudiced by the transfer.(5) TheQFC Civil and Commercial Court , on hearing an application for aCell transfer order:(A) may make an interim order or adjourn the hearing, conditionally or unconditionally; or(B) may dispense with any of the requirements of Article 108(4).(6) TheQFC Civil and Commercial Court may attach such conditions as it thinks fit to aCell transfer order, including conditions as to the discharging of claims of creditors entitled to have recourse to theCellular Assets attributable to theCell in relation to which the order is sought.(7) TheQFC Civil and Commercial Court may make aCell transfer order in relation to aCell of aPCC notwithstanding that:(A) a liquidator has been appointed to act in respect of thePCC or thePCC has passed a resolution for voluntary winding up; or(B) an administration order has been made in respect of theCell , thePCC or any otherCell thereof.(8) Notice of an application to theQFC Civil and Commercial Court for aCell transfer order shall be served upon:(A) any liquidator or administrator of thePCC or theCell concerned;(B) theRegulatory Authority ; and(C) such other persons (if any) as theQFC Civil and Commercial Court may direct.(9) The provisions of this Article are without prejudice to any power of aPCC lawfully to make payments or transfers from theCellular Assets attributable to anyCell of thePCC to a person entitled, in conformity with the provisions of this Part, to have recourse to thoseCellular Assets .(10) For the avoidance of doubt, aPCC shall not require aCell transfer order in order to invest, and change investment of,Cellular Assets or otherwise to make payments or transfers fromCellular Assets in the ordinary course of thePCC's Business .Amended by QFCA RM2012-1 (as from 11th April 2012) Article 109 - Administration orders in relation to PCCs or Cells
(1) Notwithstanding any statutory provision or rule of law to the contrary, an administrator may be appointed under theInsolvency Regulations in respect of aPCC or in respect of one or moreCells of aPCC .(2) Where an administrator is appointed under theInsolvency Regulations in respect of one or moreCells of aPCC , the relevant provisions of theInsolvency Regulations shall apply as if references therein to aCompany were to be interpreted as references to aCell .Part 5: Part 5: Migration of Body Corporate
Amended (as from 5th April 2015). Article 110 - Transfer of incorporation to QFC
(1) ANon-QFC Company may, if authorised by the laws of the jurisdiction in which it was incorporated, apply to theCRO for the continuation of theNon-QFC Company as aCompany .(2) An application for continuation shall be made to theCRO by using the form prescribed by theCRO and shall:(A) be executed under seal and signed by an officer or director of theNon-QFC Company and verified by an affidavit of the person signing the application;(B) be accompanied by articles of continuation that comply with Article 17(2)(I); and(C) be accompanied by any other document prescribed by theCRO .(3) The articles of continuation shall make any amendments to the original articles of incorporation and any amendments thereto necessary to make the articles of continuation conform to theseRegulations .Article 111 - Certificate of continuation
(1) Should theCRO approve the application, theCRO shall:(A) issue a certificate of continuation on the terms and conditions theCRO considers appropriate;(B) register theCompany ; and(C) allocate to theCompany a number, which shall be theCompany's registered number.(2) TheCRO may refuse to issue a certificate of continuation if he considers it appropriate to do so.(3) TheCRO is not required to provide reasons for refusing to issue a certificate of continuation.Article 112 - Effect of certificate
From the date of continuation stated in the certificate of continuation:
(1) theNon-QFC Company becomes aCompany to which thisRegulation applies as if it has been incorporated under theseRegulations ;(2) the articles of continuation become the articles of theCompany ; and(3) the certificate of continuation is treated as the certificate of incorporation of theCompany .Article 113 - Copy of certificate of continuation
The
CRO shall send a copy of the certificate of continuation to the appropriate official or public body in the jurisdiction in which the application for continuation was authorised.Article 114 - Rights and liabilities
Where a
Non-QFC Company is continued as aCompany under theseRegulations , theCompany :(1) continues to have all the property, rights and privileges and is subject to all the liabilities, disabilities and debts that it had before the continuation; and(2) remains a party in any legal proceedings commenced in any jurisdiction in which it was a party before the continuation.Article 115 - Transfer of incorporation from QFC to another jurisdiction
(1) ACompany may, if it is authorised by:(A) aSpecial Resolution of the shareholders; and(B) theCRO in the manner prescribed in rules made by theQFC Authority apply to the appropriate official or public body of a foreign jurisdiction to transfer its incorporation to the foreign jurisdiction and request that theCompany be continued as aNon-QFC Company .(2) ACompany shall not apply under Article 115(1) unless the laws of the foreign jurisdiction provide that theNon-QFC Company will:(A) continue to have all the property, rights and privileges and is subject to all the liabilities, disabilities and debts that it had before the continuation; and(B) remain a party in any legal proceedings commenced in any jurisdiction in which it was a party before the continuation.(3) ACompany ceases to be aCompany within the meaning of thisRegulation when theCompany is continued as aNon-QFC Company and when theNon-QFC Company files with theCRO a copy of the certificate or instrument of continuation certified by the appropriate official of the foreign jurisdiction.(4) When theCRO receives the foreign jurisdiction's certificate or instrument of continuation, theCRO must strike the name of theCompany off the index of names maintained by theCRO .Article 116 - Refusal to grant authorisation to transfer incorporation
The
CRO may refuse to authorise aCompany to apply to be continued under Article 115(1).Part 6: Part 6: Branches
Article 117 - Requirement for registered Branch
(1) ANon-QFC Company shall not engage in or carry or purport to carry on any trade orBusiness activity in or from theQFC unless it is registered as aBranch with theCRO in accordance with Article 119 of theseRegulations and shall comply with theseRegulations in all other respects.(2) ABranch shall:(A) appoint and retain at all times aPrincipal Representative in theQFC who is authorised to accept service of anyDocument or notice on behalf of theBranch and to undertake any other function as may be prescribed by theseRegulations or any subsequentRegulations ;(B) have a principal place ofBusiness in theQFC to which all communications and notices may be addressed; and(C) file with theCRO a notice of any change in the details of the:(i) persons authorised to accept service;(ii)Principal Representative of theBranch ;(iii) address of the principal place ofBusiness in theQFC ;(iv) any restrictions or revocations in the power of attorney in favour of the person referred to in Article 117(2)(A);(v) constitutional documents of theNon-QFC company ; and(vi) directors of theNon-QFC company .(3) All documentation required to be submitted to theCRO shall be in the English language, or accompanied by an appropriate translation into the English language.Amended (as from 5th April 2015). Article 118 - Application to register a Branch
(1) ANon-QFC Company wishing to establish aBranch in theQFC shall apply to theCRO for prior approval to establish aBranch in theQFC .(2) An application by aNon-QFC Company for approval to establish aBranch in theQFC shall:(A) be made to theCRO in such form and manner as theCRO may require from time;(B) describe the type ofBusiness activity to be carried on from theBranch ;(C) state the full address of the principal place ofBusiness in theQFC ;(D) state the full name and address of the person authorised to accept service on behalf of theBranch ;(E) be accompanied by the followingDocuments , verified in such manner as theCRO may require:(i) a copy of the constitutional documents of theNon-QFC Company ;(ii) a copy of the audited accounts of theNon-QFC Company for the preceding two years, save where the applicantNon-QFC Company has been in existence for less than two years in which case a copy of the most recent audited accounts;(iii) a copy of the resolution of the board of directors of theNon-QFC Company to establish aBranch in theQFC ;(iv) a power of attorney in favour of the person referred to in Article 117(2)(A);(v) a list of the fullName ,Address , date of birth, nationality and business occupation of each director of theNon-QFC Company ;(vi) a certified copy of the certificate of incorporation or other instrument evidencing the incorporation of theNon-QFC Company ; and(vii) such otherDocuments or information as theCRO orQFC Authority may in their absolute discretion require from time to time;(F) contain or be accompanied by such further particulars, verified in such manner, as theCRO orQFC Authority may require; and(G) be accompanied by anyPrescribed Fee .Amended (as from 5th April 2015). Article 119 - Acceptance or refusal of application to register a Branch
(1) TheCRO may on an application duly made in accordance with Article 118 accept or refuse the application.(2) Where theCRO accepts an application under this Article 119, it shall issue to the applicant a certificate of registration of theBranch in theQFC and such certificate shall be admissible in evidence in proceedings under theseRegulations without further proof and shall be evidence of the facts certified or specified therein. A certificate of registration shall be conclusive evidence that theNon-QFC Company is registered with the name and number specified in it and that the requirements of theseRegulations have been complied with in respect of the registration of theNon-QFC Company and thereafter no defect in the process prior to the registration thereof shall affect the validity of its registration.(3) A decision of theCRO refusing to accept an application to establish aBranch may be reviewed consistent with any applicable standards and procedures issued by theQFC Authority for such purpose.Article 120 - Prohibition of Branch with an undesirable name
(1) NoBranch shall be registered with a name which is the same as or, in the opinion of theCRO , too like a name appearing in the index of names maintained by theCRO or which in the opinion of theCRO is offensive or otherwise undesirable.(2) If, in the opinion of theCRO , the name by which aBranch is registered gives so misleading an indication of the nature of its activities as to be likely to cause harm to the public, it may in writing direct theBranch to change its name within such period (being not less than 1 month) as theCRO may specify.(3) Such direction shall be complied with within the period specified in the direction or such longer period as theCRO may allow.Amended (as from 5th April 2015). Article 121 - Principal Representatives
Every
Branch shall give notice in writing to theCRO of such particulars of itsPrincipal Representative as theCRO may determine.Article 122 - Register of Branches
(1) TheCRO shall maintain a register ofBranches which shall include:(A) the name of theBranch and, if different, the name of theNon-QFC Company ;(B) the principal place in theQFC from which theBranch engages in or carries on anyBusiness in theQFC and the address of the registered office of theNon-QFC Company ;(C) the name and address of thePrincipal Representative ;(D) thePrincipal Representative of theBranch ;(E) persons authorised to accept service;(F) the date and place of incorporation of itsNon-QFC Company ;(G) the date of registration of theBranch ;(H) the registered number of theBranch ;(I) constitutional documents of theNon-QFC company ;(J) directors of theNon-QFC company ; and(K) such other information as theCRO shall determine.(2) If any particulars required by Article 122(1) are altered, theBranch shall give notice in writing to theCRO of the particulars of the alteration within 21 days after the alteration is made on thePrescribed Form together with anyPrescribed Fee .Amended (as from 5th April 2015). Article 123 - Records to be kept by Branches
(1) EveryBranch shall keep proper accountingRecords with respect to all sums of money received and expended by theBranch and all sales and purchases of goods and services and other transactions by theBranch and the assets andLiabilities of theBranch . SuchRecords shall be sufficient to show and explain all transactions by theBranch and must be such as to:(A) disclose with reasonable accuracy the financial position of theBranch at any time; and(B) enable the directors to ensure that any accounts prepared by theBranch comply with the requirements of theseRegulations .(2) TheBranch's accountingRecords shall be:(A) kept at theBranch's principal place ofBusiness ;(B) preserved by theBranch for at least 6 years from the date to which they relate; and(C) at all reasonable times open to inspection by directors and auditor of the relevantNon-QFC Company .Amended (as from 5th April 2015). Article 124 - Letterheads
Once registered every
Branch shall have the following particulars on allBusiness letters, written orders for goods or services, invoices and receipts, written demands for payment and other such similar documentation:(1) its name which shall include the words "QFC Branch " or "Qatar Financial Centre Branch"; or(2) where theBranch name is different to theNon-QFC Company , the name shall include the words "QFC Branch of [the name of theNon-QFC Company ];(3) the place of incorporation of theNon-QFC Company ; and(4) the principal place in theQFC from which theBranch engages in or carries on anyBusiness .Amended (as from 5th April 2015). Article 125 - Name to appear outside place of Business
(1) EveryBranch shall within 21 days of registration paint or affix, and keep painted or affixed, its name on the outside of every office or place in which itsBusiness is carried on, in a conspicuous position and in letters easily legible.(2) If aBranch does not paint or affix, and keep painted or affixed, its name as required as above, then theNon-QFC Company concerned and everyOfficer of it who is in default is in contravention of theseRegulations .Amended by QFCA RM2012-1 (as from 11th April 2012) Article 126 - Financial Penalties
Where a
Non-QFC Company fails to comply with any provision of this Part 6 and no other financial penalty is provided in theseRegulations , theNon-QFC Company , itsOfficers and any person who appears to theRegulatory Tribunal to be in charge of its affairs in theQFC shall be liable if so ordered by theRegulatory Tribunal to pay the financial penalties prescribed by theCRO .Amended by QFCA RM2012-1 (as from 11th April 2012) Part 7: International Business Companies
Reserved
Part 8: Part 8: Contraventions
Article 127 - General contraventions
(1) A person who:(A) does an act or thing that the person is prohibited from doing under an Article of theseRegulations referred to in Schedule 1; or(B) does not do an act or thing that the person is required or directed to do under an Article of theseRegulations referred to in Schedule 1; or(C) otherwise contravenes an Article of theseRegulations referred to in Schedule 1commits a contravention of theseRegulations .(2) In this Article 127, "person" does not include theQFC Authority , theRegulatory Authority , theCRO or theRegistrar .Article 128 - Involvement in contraventions
(1) If a person is knowingly concerned in the contravention of theseRegulations or any otherRegulations conferring functions on theCRO committed by another person, the aforementioned person as well as the other person, commits the contravention and is liable to be proceeded against and dealt with accordingly.(2) Without limiting the generality of Article 128(1), if an officer of anEntity is knowingly concerned in a contravention of theseRegulations or any otherRegulations conferring functions on theCRO committed by anEntity , the officer as well as theEntity commits the contravention and is liable to be proceeded against and dealt with accordingly.(3) If the affairs of anEntity are managed by itsMembers , Article 128(2) applies in relation to the acts and defaults of aMember in connection with his functions of management as if he were a director of theEntity .(4) For the purposes of this Article 128, "officer" means a director, member of a committee of management, chief executive, manager, secretary or other civil officer of anEntity , or a person purporting to act in such capacity, and an individual who is in control of the body.(5) For the purposes of this Article 128, a person is "knowingly concerned" in a contravention if, and only if, the person:(A) has aided, abetted, counselled or procured the contravention;(B) has induced, whether by threats or promises or otherwise, the contravention;(C) has in any way, by act or omission, directly or indirectly, been knowingly involved in or been party to, the contravention;(D) has conspired with another or others to effect the contravention; or(E) has, alone or in concert with others, directly or indirectly, done, attempted or planned any of the following:(i) to conceal the existence or nature of a contravention; or(ii) to obstruct, impede or prevent theQFC Authority , theRegulatory Authority or theCRO from detecting, investigating or prosecuting a contravention.(6) In this Article 128, "person" does not include theQFC Authority , theRegulatory Authority , theCRO or theRegistrar .Article 129 - Imposition of financial penalties
(1) TheQFC Authority may in rules prescribe procedures in relation to the imposition and recovery of financial penalties under theseRegulations .(2) Where theCRO considers that a person has contravened a provision in theseRegulations referred to in Schedule 1 and in relation to which a penalty is stipulated in thatSchedule , it may impose by written notice given to the person a penalty, in respect of the contravention, of such amount as it considers appropriate but not exceeding the amount of the maximum penalty specified in Schedule 1 in respect of each contravention.(3) If, within the period specified in the notice:(A) the person pays the prescribed penalty to theCRO , then no proceedings may be commenced by theCRO against the person in respect of the relevant contravention; or(B) the person takes such action as is prescribed in rules made by theQFC Authority to object to the imposition of the penalty or has not paid the prescribed penalty to theCRO , theCRO may apply to theRegulatory Tribunal for, and theRegulatory Tribunal may so order, the payment of the penalty or so much of the penalty as is not paid and make any further order as theRegulatory Tribunal sees fit for recovery of the penalty.(4) A certificate that purports to be signed by or on behalf of theCRO and states that a written notice was given to the person pursuant to Article 129(2) imposing a penalty on the basis of specific facts is:(A) conclusive evidence of the giving of the notice to the person; and(B) prima facie evidence of the facts contained in the noticein any proceedings commenced under this Article 129.(5) Where a person commits a contravention of theseRegulations and no penalty is stipulated in Schedule 1 in relation to such contravention, such person shall be liable to such penalty as may be provided for or determined under any other provision of theseRegulations or any otherRegulations .Amended by QFCA RM2012-1 (as from 11th April 2012) Part 9: Part 9: Other Provisions Relating to the CRO
Article 130 - Direction to Company to comply with these Regulations
(1) If aCompany or anyOfficer of it fails to comply with:(A) a provision of theseRegulations or any otherRegulations giving functions to theCRO ; or(B) a requirement made by theCRO pursuant to any power under any suchRegulations which requires either or both of them to deliver to or file with theCRO anyDocument or to give notice to it of any matter, theCRO may issue a direction that theCompany or anyOfficer of it or both of them make good the failure within a time specified in that direction. Any person who fails to comply with such direction contravenes theseRegulations .(2) If aCompany or anyOfficer of it fails to comply with a provision of theseRegulations , or any otherRegulations which requires either or both of them to comply with a lawful requirement in relation to another person, theCRO may issue a direction that theCompany or anyOfficer of it or both of them make good the failure within a time specified in that direction. Any person who fails to comply with such direction contravenes theseRegulations .(3) If theCRO considers that theCompany or anyOfficer of it has failed to comply with a direction, it may apply to theRegulatory Tribunal for one or more of the following orders:(A) an order directing theCompany orOfficer to comply with the direction or with any provision of theRegulations or any otherRegulations giving functions to theCRO relevant to the issue of the direction;(B) an order directing theCompany orOfficer to pay any costs incurred by theCRO or other person relating to the issue of the direction by theCRO or the breach of theseRegulations or such otherRegulations relevant to the issue of the direction; or(C) any other order that theRegulatory Tribunal considers appropriate.(4) Nothing in this Article 130 shall prejudice the operation of any Article of these or any otherRegulations providing for the imposition of financial penalties on aCompany or anyOfficer in respect of a failure mentioned above, nor any powers that theCRO or other person or theRegulatory Tribunal may have under any other provision of theseRegulations or any otherRegulations .Amended by QFCA RM2012-1 (as from 11th April 2012) Article 131 - Deregistration of Companies and Branches
(1) If theCRO has reason to believe that:(A) aCompany orBranch is not carrying onBusiness or is not in operation;(B) aCompany orBranch is acting in contravention of theseRegulations ;(C) it is prejudicial to the interests of theQFC for aCompany orBranch to remain on the register; or(D) aCompany orBranch has failed for a period of 3 months to pay the financial penalties imposed by theCRO pursuant to theseRegulations it may give notice to theCompany orBranch that at the conclusion of 3 months from the date of the notice, theCompany orBranch shall be struck off the register unless reason is shown to the contrary.(2) If, by the end of the 3 month period, theCRO :(A) has received confirmation that theCompany orBranch is no longer carrying onBusiness or is not in operation; or(B) has not received from theCompany orBranch sufficient reasons as to why theCompany orBranch should not be struck off the register;theCRO may strike the name of theCompany orBranch off the register and theCompany orBranch shall be dissolved.(3) Where aCompany orBranch is struck off the register under this Article, the liability of every director andMember of theCompany or relevantBody Corporate , and in the case of the striking off of aBranch , theBody Corporate itself continues and may be enforced as if theCompany orBranch had not been dissolved.(4) ACompany orBranch may apply to theCRO for voluntary deregistration, at the conclusion of 3 months from the date of the application, theCompany orBranch may be struck off the register. If theCompany or theBranch is not carrying onBusiness or is not in operation, theCRO may elect, at its absolute discretion, to strike off theCompany orBranch prior to the conclusion of the 3 months period provided that theCompany orBranch has complied with any requirement under theInsolvency Regulations and Insolvency Rules.Amended (as from 5th April 2015). Article 132 - False or Misleading Information
A person shall not:
(1) provide information which is false, misleading or deceptive to theCRO ; or(2) conceal information where the concealment of such information is likely to mislead or deceive theCRO .Part 10: Part 10: Application to the QFC Civil and Commercial Court
Article 133 - Orders for compensation
(1) Where a person intentionally, recklessly or negligently commits a breach of any requirement, duty, prohibition, responsibility or obligation which is imposed by or under theseRegulations or any otherRegulations conferring functions on theCRO , the person is liable to compensate any other person for any loss or damage caused to that other person as a result of such conduct, and is otherwise liable to restore the person to the position they were in prior to such conduct.(2) Where a person suffers loss or damage caused as a result of conduct described in Article 133(1), theQFC Civil and Commercial Court may on application brought by the person, make orders for the recovery of damages or for compensation or for the recovery of property or any other order as theQFC Civil and Commercial Court sees fit, except where such liability is excluded under theseRegulations or anyRegulations conferring functions on theCRO .(3) Nothing in this Article 133 affects the powers that any person or theQFC Civil and Commercial Court may have apart from this Article.Amended by QFCA RM2012-1 (as from 11th April 2012) Article 134 - Minority Member protection: unfair prejudice
(1) AMember of aCompany may apply to theQFC Civil and Commercial Court on the ground that theCompany's affairs are being or have been conducted in a manner which is unfairly prejudicial to the interests of some part of theMembers (including at least himself) or that any actual or proposed act or omission by theCompany (including an act or omission on its behalf) is or would be so prejudicial.(2) Pursuant to such application, theQFC Civil and Commercial Court may make an order to:(A) require theCompany to refrain from doing or continuing an act complained of by the applicant or to do an act which the applicant has complained it has omitted to do;(B) provide for the purchase of theShares of anyMembers of theCompany or by theCompany itself;(C) authorise proceedings to be brought in the name and on behalf of theCompany by such person or persons and on such terms as theQFC Civil and Commercial Court may direct;(D) regulate the conduct of theCompany's affairs in the future; or(E) make such other order as theQFC Civil and Commercial Court thinks fit.(3) If an order under this Article 134 requires theCompany not to make any, or any specified, alterations in its articles of association, theCompany shall not then without leave of theQFC Civil and Commercial Court make any such alteration.(4) An alteration in theCompany's articles of association made by virtue of an order under this Article 134 is of the same effect as if duly made bySpecial Resolution of theCompany , and the provisions of theseRegulations apply to its articles of association as so altered accordingly.(5) The order of theQFC Civil and Commercial Court recording the making of an order under this Article 134 altering, or giving leave to alter, aCompany's articles of association shall, within 21 days from the making of the order or such longer period as theQFC Civil and Commercial Court may allow, be delivered by theQFC Civil and Commercial Court to theCRO for registration.(6) Nothing in this Article 134 affects the powers that any person or theQFC Civil and Commercial Court may have apart from this Article 134.Amended by QFCA RM2012-1 (as from 11th April 2012) Part 11: Part 11: Reporting
Article 135 - Reporting by the CRO
(1) TheCRO shall report to theQFC Authority in such manner as theQFC Authority may direct.(2) TheQFC Authority shall provide theMinister with a written report on the exercise of the powers and performance of the functions of theCRO and its financial activities.(3) Such report shall be prepared and provided before the end of the first quarter of the financial year of theCRO or within such other period as theMinister may require and shall relate to the previous financial year.(4) Such report may be published by theQFC Authority without undue delay or within such time period as theMinister otherwise directs.Part 12: Part 12: Register of Financing Statements
Article 136 - Definitions
In this Part the following expressions shall bear the meaning given to them in the Security Regulations:
"Business Days"; "Collateral"; "Debtor"; "Goods"; " Person", "Proceeds"; "Personal Property"; "Secured Party"; "Security Agreement"; "Security Interest"; and "Unique Identifying Number".Amended by QFCA RM2012-1 (as from 11th April 2012) Article 137 - The Register
(1) There is to be a register of financing statements established and maintained by theCRO .(2) Subject to theSecurity Regulations , theseRegulations and any rules made by theQFC Authority , the filing of a financing statement is effective for the purposes of perfecting a Security Interest and determining priority.(3) The filing of a financing statement does not create a presumption that theSecurity Regulations applies to the transaction to which the filing relates.(4) TheQFC Authority may make rules in respect of any matter that facilitates the administration of this Part or furthers the purposes of this Part, including but not limited to rules which may:(A) provide criteria for the effective filing of financing statements, amendments and other records and notifications required or permitted under this Part, including without limitation requirements as to their form, content and medium and the identification of the Debtor, the Secured Party and the Collateral;(B) provide for standard forms for use in filing financing statements, amendments and other records and notifications under paragraph (A);(C) provide for indexing, publication and licensing of financing statements, amendments and other records either individually or collectively;(D) exclude or limit the liability of theCRO ; and(E) prescribe fees payable for processing applications for filing and production of records under this Part.Article 138 - Financing statement
(1) A financing statement must be filed in accordance with this Part and any furtherRegulations .(2) The filing of a financing statement is ineffective unless the Debtor consents to the filing. A Debtor who enters into a Security Agreement is treated as consenting to the filing of a financing statement which relates to the Collateral mentioned in the Security Agreement and its Proceeds.(3) The filing of a financing change statement which:(A) adds to the Collateral covered by a financing statement; or(B) adds a Debtor to a financing statementis ineffective unless that Debtor consents to the filing.(4) A Debtor may consent to the filing of a financing statement, or be treated as consenting under paragraph (2), with retrospective effect from the date of filing.(5) Subject to Article 142, a financing statement must contain the following information to be effective:(A) the name of the Debtor;(B) the Debtor's registered number (if any);(C) the name and address of the Secured Party or its agent (if any);(D) a description of the Collateral;(E) whether the filing is to continue indefinitely or for a specified period; and(F) such other matters as may be prescribed in rules made by theQFC Authority .(6) If the Collateral is of a type which has a Unique Identifying Number, that number must also be included in the financing statement if that Collateral is of a type prescribed in rules made by theQFC Authority .Amended (as from 5th April 2015). Article 139 - Time of filing
(1) Filing of a financing statement is effective when a date, time and financing statement number are assigned to it by theCRO .(2) A financing statement may be filed:(A) before or after a Security Agreement is made; and(B) before or after a Security Interest attaches.(3) A financing statement may relate to one or more Security Agreements.(4) TheCRO shall not accept a filing:(A) until anyPrescribed Fees are paid; and(B) which does not provide information relating to each category listed in Article 138(5).(5) If theCRO is satisfied that an entry on the register was not filed in accordance with, or for the purposes of, this Part theCRO shall notify the Secured Party (or its agent) and any other person named on the financing statement. TheCRO may remove the entry from the register 21 Business Days after such notification unless any recipient of such notice applies for an order from theQFC Civil and Commercial Court to maintain that entry on the register.(6) On application to theQFC Civil and Commercial Court under Article 139(5), theQFC Civil and Commercial Court may order that the entry on the register:(A) be maintained on any condition that theQFC Civil and Commercial Court considers appropriate; or(B) be removedand theCRO must amend the register as relevant to that financing statement accordingly.Amended by QFCA RM2012-1 (as from 11th April 2012) Article 140 - Duration of filing
(1) Subject to paragraph (2), a filing continues to have effect:(A) indefinitely; or(B) if a specified period is indicated on the financing statement, for that specified period.(2) A filing ceases to have effect when it is discharged.Article 141 - CRO to issue verification statement
(1) As soon as reasonably practicable after the filing of a financing statement or financing change statement theCRO must send a verification statement to the Person making the filing.(2) "Verification statement" means a statement containing:(A) the information contained in the financing statement or financing change statement;(B) the financing statement number or financing change statement number;(C) the date and time of filing; and(D) any other prescribed data which is required to confirm the filing of a financing statement.(3) The Secured Party or Person named as the Secured Party in the financing statement or financing change statement must send to the Debtor a copy of the verification statement within ten Business Days of receiving it, unless the Debtor has waived in writing the right to receive a copy or the Debtor files the financing statement or financing change statement.Article 142 - Errors in financing statement
(1) A financing statement is not effective:(A) if it contains a defect, irregularity, omission or error such that the existence of the Security Interest would not be discovered by a reasonable search under Article 145 (whether or not a search is actually carried out); or(B) to the extent that it purports to include Collateral not mentioned in any Security Agreement to which it may relate.(2) Failure to provide a description in a financing statement in relation to any item or kind of Collateral does not make the filing ineffective with respect to other Collateral described in the financing statement.(3) Without limiting the generality of paragraph (1), a purchaser of Goods with a Unique Identifying Number who searches the register using that number alone is taken to have made a reasonable search.(4) Failure to provide the correct Unique Identifying Number in relation to any item of Collateral does not make the filing ineffective with respect to other Collateral described in the financing statement.(5) The effectiveness of a financing statement is not otherwise affected by any defect, irregularity, omission or error not specified in paragraph (1).Amended by QFCA RM2012-1 (as from 11th April 2012) Article 143 - Renewal and amendment of filing
(1) A filing may be renewed by filing a financing change statement at any time before the filing expires and the period of time for which the filing is effective is extended by the renewal period indicated on the financing change statement.(2) An amendment to a filing may be effected by filing a financing change statement at any time before the filing expires, and the amendment is effective from the time when the financing change statement is filed to the expiry of the filing which is being amended.(3) If the Debtor changes its name, registered number (if any) or other identifier it must file a financing change statement with theCRO within 21 Business Days.Amended by QFCA RM2012-1 (as from 11th April 2012) Article 144 - Filing of transfers and subordinations
(1) If a Secured Party with a Security Interest perfected by filing transfers the Security Interest or a part of it, a financing change statement may be filed disclosing the transfer. Where only an interest in part of the Collateral is transferred, the financing change statement must contain a description of the Collateral in which the interest is transferred.(2) After the filing of a financing change statement disclosing a transfer of a Security Interest, the transferee is the Secured Party for the purposes of theSecurity Regulations .(3) If a Secured Party transfers a Security Interest which is not perfected or has not been perfected by filing, a financing statement may be filed (before or after the transfer) in which the transferee is disclosed as the Secured Party.(4) For the avoidance of doubt, the transferee of a Security Interest is not required to file a financing change statement in order to continue the perfected status of the Security Interest against purchasers or in the event of insolvency.(5) Where a Security Interest has been subordinated by the Secured Party to the interest of another Person, a financing change statement may be filed to disclose the subordination at any time.Article 145 - Searches
(1) The register must be organised so as to permit searches and under one or more of the following criteria:(A) the name of the Debtor;(B) the registered number of the Debtor (if any);(C) the financing statement number;(D) the Collateral's Unique Identifying Number (if any),and any additional criteria specified by theCRO .(2) A search result that purports to be authorised by theCRO , whether printed by theCRO or by any other Person, is receivable as evidence as prima facie proof of its contents, including:(A) the date of filing of a financing statement to which the search result refers; and(B) the order of filing of the financing statement as indicated by the financing statement number.(3) TheCRO shall not authorise a search result until anyPrescribed Fee is paid.Amended by QFCA RM2012-1 (as from 11th April 2012) Article 146 - Debtor may require financing change statement
(1) If:(A) a financing statement is filed; and(B) one of the conditions set out in column 1 of Table 1 in Schedule 2 to theseRegulations is satisfied, the Debtor, or any Person with an interest in Personal Property which falls within the Collateral description on the financing statement, may give a notice in writing (a "requirement notice") to the Secured Party.(2) The requirement notice must:(A) specify the condition which is satisfied;(B) require the Secured Party to file a financing change statement with the effect indicated in column 2 of Table 1 in Schedule 2 relating to that condition; and(C) inform the Secured Party that failure to comply with the requirement notice may result in the Person who gives the notice filing the appropriate financing change statement.(3) If the Person who gives a requirement notice is not the sole Debtor, he must send a copy of the requirement notice to every other Debtor to whom the financing statement relates within 5 Business Days of the requirement notice being given to the Secured Party.(4) The Person who gives a requirement notice may file a financing change statement as requested in the requirement notice if the Secured Party does not, within 21 Business Days after the requirement notice is given, either:(A) comply with the requirement notice; or(B) apply for an order from theQFC Civil and Commercial Court to maintain the filing of the financing statement to which the requirement notice relates and notify the Person who gave the requirement notice and theCRO accordingly.(5) If theCRO receives notification under paragraph (4)(B), it must as soon as reasonably practicable amend the entry on the register relating to the financing statement in question to show that it is the subject of a dispute.(6) On application to theQFC Civil and Commercial Court by a Secured Party, theQFC Civil and Commercial Court may order that the filing:(A) be maintained on any condition and for any period of time that theQFC Civil and Commercial Court considers appropriate, subject to Article 140 and Article 141; or(B) be discharged or amendedand theCRO must amend the entry on the register relating to the financing statement accordingly.(7) Notices under this Article 146 must be given in the prescribed manner.Amended (as from 5th April 2015). Part 13: Part 13: Acquisition of Minorities in Take-Overs
Article 147 - Definitions
(1) In this Part, a "take-over offer" means an offer to acquire all theShares , or all theShares of any class or classes, in aCompany (other thanShares which at the date of the offer are already held by the offeror), being an offer on terms which are the same in relation to all theShares to which the offer relates or, where thoseShares includeShares of different classes, in relation to all theShares of each class.(2) In this Article, "Shares " meansShares which have been allotted on the date of the offer but a take-over offer may includeShares that are subsequently allotted before a date specified in or determined in accordance with the terms of the offer.Article 148 - Take-over offers
(1) The terms offered in relation to anyShares shall for the purposes of this Article 148 be treated as being the same in relation to all theShares or, as the case may be, all theShares of a class to which the offer relates notwithstanding any variation permitted by Article 148(2).(2) A variation is permitted by this paragraph where:(A) the law of a country or territory outside theQFC precludes the acceptance of an offer in the form or the forms specified, or precludes it except after compliance by the offeror with conditions with which he is unable to comply or which he regards as unduly onerous; and(B) the variation is such that the persons by whom the acceptance of an offer in that form is precluded are able to accept an offer in a different form but of substantially equivalent value.(3) The reference in Article 147(1) toShares already held by the offeror includes a reference toShares which he has contracted to acquire (which term shall includeShares which the offeror has an unconditional option to acquire) but shall not be construed as includingShares which are the subject of a contract binding the holder to accept the offer when it is made, being a contract entered into by the holder for nothing other than a promise by the offeror to make the offer.(4) Where the terms of an offer make provision for their revision and for acceptances on the previous terms to be treated as acceptances on the revised terms, the revision shall not be regarded for the purposes of this Part as the making of a fresh offer and references in this Part to the date of the offer shall accordingly be construed as references to the date on which the original offer was made.(5) In this Part "the offeror" means, subject to Article 154, the person making a take-over offer and "theCompany " means theCompany whoseShares are the subject of the offer.Article 149 - Right of offeror to buy out minority Members
(1) If, in a case in which a take-over offer does not relate toShares of different classes, the offeror has by virtue of acceptances of the offer acquired or contracted to acquire not less than nine-tenths in nominal value of theShares to which the offer relates he may give notice to the holder of anyShares to which the offer relates which the offeror has not acquired or contracted to acquire that he desires to acquire thoseShares .(2) If, in a case in which a take-over offer relates toShares of different classes, the offeror has by virtue of acceptances of the offer acquired or contracted to acquire not less than nine-tenths in nominal value of theShares of any class to which the offer relates, he may give notice to the holder of anyShares of that class which the offeror has not acquired or contracted to acquire that he desires to acquire thoseShares .(3) No notice shall be given under Article 149(1) or (2) unless the offeror has acquired or contracted to acquire theShares necessary to satisfy the minimum specified in those paragraphs before the end of the period of 4 months beginning with the date of the offer; and no such notice shall be given after the end of the period of 2 months beginning with the date on which he has acquired or contracted to acquireShares which satisfy that minimum.(4) When the offeror gives the first notice in relation to an offer he shall send a copy of it to theCompany together with a declaration by him stating that the conditions for the giving of the notice are satisfied. A person who makes such a declaration must have reasonable grounds for believing it to be true.(5) Where the offeror is aBody Corporate (whether or not aCompany within the meaning of theseRegulations ) the declaration shall be signed by a director.(6) If a person is proceeded against in respect of an alleged contravention for failing to send a copy of a notice as required by Article 149(4) it is a defence for him to prove that he took reasonable steps for securing compliance with that paragraph.(7) Where during the period within which a take-over offer can be accepted the offeror acquires or contracts to acquire any of theShares to which the offer relates but otherwise than by virtue of acceptances of the offer, then if:(A) the value of that for which they are acquired or contracted to be acquired ("the acquisition value") does not at that time exceed the value of that which is receivable by an acceptor under the terms of the offer; or(B) those terms are subsequently revised so that when the revision is announced the acquisition value, at the time mentioned in Article 149(7)(A), no longer exceeds the value of that which is receivable by an acceptor under those termsthe offeror shall be treated for the purposes of this Article 149 as having acquired or contracted to acquire thoseShares by virtue of acceptances of the offer; but in any other case thoseShares shall be treated as excluded from those to which the offer relates.Amended (as from 5th April 2015). Article 150 - Effect of notice under Article 149
(1) The following provisions shall, subject to Article 148, have effect where a notice is given in respect of anyShares under Article 149.(2) The offeror shall be entitled and bound to acquire thoseShares on the terms of the offer.(3) Where the terms of an offer are such as to give the holder of anyShares a choice of payment for hisShares the notice shall give particulars of the choice and state:(A) that the holder of theShares may within 6 weeks from the date of the notice indicate his choice by a written communication sent to the offeror at an address specified in the notice; and(B) which payment specified in the offer is to be taken as applying in default of his indicating a choice as aforesaidand the terms of the offer mentioned in Article 150(2) shall be determined accordingly.(4) Article 150(3) applies whether or not any time-limit or other conditions applicable to the choice under the terms of the offer can still be complied with; and if the payment chosen by the holder of theShares :(A) is not cash and the offeror is no longer able to make that payment; or(B) was to have been made by a third party who is no longer bound or able to make that paymentthe payment shall be taken to consist of an amount of cash payable by the offeror which at the date of the notice is equivalent to the chosen payment.(5) At the end of 6 weeks from the date of the notice the offeror shall forthwith:(A) send a copy of the notice to theCompany ; and(B) make payment to theCompany for theShares to which the notice relates.(6) The copy of the notice sent to theCompany under Article 150(5)(A) shall be accompanied by an instrument of transfer executed on behalf of theMember by a person appointed by the offeror; and on receipt of that instrument theCompany shall register the offeror as the holder of thoseShares .(7) Where the payment referred to in Article 150(5)(B) is to be made inShares or securities to be allotted by the offeror the reference in that paragraph to the making of payment shall be construed as a reference to the allotment of theShares or securities to theCompany .(8) Any sum received by aCompany under Article 150(5)(B) and any other payment received under that paragraph shall not be the property of theCompany but shall be held by theCompany on behalf of the person entitled to theShares in respect of which the sum or other payment was received.(9) Any sum received by aCompany under Article 150(5)(B) and any dividend or other sum accruing from any other payment received by aCompany under that paragraph, shall be paid into a separate bank account, being an account the balance on which bears interest at an appropriate rate and can be withdrawn by such notice (if any) as is appropriate.Amended (as from 5th April 2015). Article 151 - Right of minority Member to be bought out by offeror
(1) If in a case in which a take-over offer does not relate toShares of different classes, at any time before the end of the period within which the offer can be accepted:(A) the offeror has by virtue of acceptances of the offer acquired or contracted to acquire some (but not all) of theShares to which the offer relates; and(B) thoseShares , with or without any otherShares in theCompany which he has acquired or contracted to acquire, amount to not less than nine-tenths in nominal value of all theShares in the Companythe holder of anyShares to which the offer relates who has not accepted the offer may by a written communication addressed to the offeror require him to acquire thoseShares .(2) If a take-over offer relates toShares of any class or classes and at any time before the end of the period within which the offer can be accepted:(A) the offeror has by virtue of acceptances of the offer acquired or contracted to acquire some (but not all) of theShares of any class to which the offer relates; and(B) thoseShares , with or without any otherShares of that class which he has acquired or contracted to acquire, amount to not less than nine-tenths in nominal value of all theShares of that classthe holder of anyShares of that class who has not accepted the offer may by a written communication addressed to the offeror require him to acquire thoseShares .(3) Within 1 month of the time specified in Article 151(1) the offeror shall give anyMember who has not accepted the offer notice of the rights that are exercisable by him under that Article; and if the notice is given before the end of the period mentioned in that Article it shall state that the offer is still open for acceptance.(4) A notice under Article 151(3) may specify a period for the exercise of the rights, conferred by this Article and in that event the rights shall not be exercisable after the end of that period; but no such period shall end less than 3 months after the end of the period within which the offer can be accepted.(5) Article 151(3) does not apply if the offeror has given theMember notice in respect of theShares in question under Article 149.(6) If the offeror fails to comply with Article 151(3) he and, if the offeror is anEntity , every officer of theEntity who is in default or to whose neglect the failure is attributable, commits a contravention.(7) If an offeror other than anEntity is proceeded against in respect of an alleged contravention for failing to comply with Article 151(3) it is a defence for him to prove that he took all reasonable steps for securing compliance with that Article.Amended (as from 5th April 2015). Article 152 - Effect of requirement under Article 151
(1) The following provisions shall, subject to Article 153, have effect where aMember exercises his rights in respect of anyShares under Article 151.(2) The offeror shall be entitled and bound to acquire thoseShares on the terms of the offer or on such other terms as may be agreed.(3) Where the terms of an offer are such as to give the holder ofShares a choice of payment for hisShares the holder of theShares may indicate his choice when requiring the offeror to acquire them and the notice given to the holder under Article 151(3):(A) shall give particulars of the choice and of the rights conferred by this paragraph; and(B) may state which payment specified in the offer is to be taken as applying in default of his indicating a choiceand the terms of the offer mentioned in Article 152(2) shall be determined accordingly.(4) Article 152(3) applies whether or not any time limit or other conditions applicable to the choice under the terms of the offer can still be complied with; and if the payment chosen by the holder of theShares :(A) is not cash and the offeror is no longer able to make that payment; or(B) was to have been made by a third party who is no longer bound or able to make that paymentthe payment shall be taken to consist of an amount of cash payable by the offeror which at the date when the holder of theShares requires the offeror to acquire them is equivalent to the chosen payment.Article 153 - Applications to the QFC Civil and Commercial Court
(1) Where a notice is given under Article 149 to the holder of anyShares theQFC Civil and Commercial Court may, on an application made by him within 6 weeks from the date on which the notice was given:(A) order that the offeror shall not be entitled and bound to acquire theShares ; or(B) specify terms of acquisition different from those of the offer.(2) If an application to theQFC Civil and Commercial Court under Article 153(1) is pending at the end of the period mentioned in Article 150(5) that Article shall not have effect until the application has been disposed of.(3) Where the holder of anyShares exercises his rights under Article 151 theQFC Civil and Commercial Court may, on an application made by him or the offeror, order that the terms on which the offeror is entitled and bound to acquire theShares shall be such as theQFC Civil and Commercial Court thinks fit.(4) No order for costs or expenses shall be made against aMember making an application under Article 153(1) or (3) unless theQFC Civil and Commercial Court considers:(A) that the application was unnecessary, improper or vexatious; or(B) there has been unreasonable delay in making the application or unreasonable conduct on his part in conducting the proceedings on the application.(5) Where a take-over offer has not been accepted to the extent necessary for entitling the offeror to give notices under Article 149(1) or (2) theQFC Civil and Commercial Court may, on the application of the offeror, make an order authorising him to give notices under that Article if satisfied:(A) that the offeror has after reasonable enquiry been unable to trace one or more of the persons holdingShares to which the offer relates;(B) that theShares which the offeror has acquired or contracted to acquire by virtue of acceptances of the offer, together with theShares held by the person or persons mentioned in sub-paragraph (A), amount to not less than the minimum specified in that Article; and(C) that the terms offered are fair and reasonablebut theQFC Civil and Commercial Court shall not make an order under this Article unless it considers that it is just and equitable to do so having regard, in particular, to the number ofMembers who have been traced but who have not accepted the offer.Amended (as from 5th April 2015). Article 154 - Joint offers
(1) A take-over offer may be made by two or more persons jointly and in that event this Part has effect with the following modifications.(2) The conditions for the exercise of the rights conferred by Articles 149 and 151 shall be satisfied by the joint offerors acquiring or contracting to acquire the necessaryShares jointly (as respects acquisitions by virtue of acceptances of the offer) and either jointly or separately (in other cases); and, subject to the following provisions, the rights and obligations of the offeror under those Articles and Articles 150 and 152 shall be respectively joint rights and joint and several obligations of the joint offerors.(3) It shall be a sufficient compliance with any provision of those Articles requiring or authorising a notice or otherDocument to be given or sent by or to the joint offerors that it is given or sent by or to any of them; but the declaration required by Article 149(4) shall be made by all of them and, in the case of a joint offeror being anEntity , signed by a director of thatEntity .(4) In Article 148, Article 150(7) and Article 153 references to the offeror shall be construed as references to the joint offerors or any of them.(5) In Article 150(6) references to the offeror shall be construed as references to the joint offerors or such of them as they may determine.(6) In Article 150(4)(A) references to the offeror being no longer able to make the relevant payment shall be construed as references to none of the joint offerors being able to do so.(7) In Article 153 references to the offeror shall be construed as references to the joint offerors except that any application under paragraph (3) or (5) may be made by any of them and the reference in sub-paragraph (5)(A) to the offeror having been unable to trace one or more of the persons holdingShares shall be construed as a reference to none of the offerors having been able to do so.Article 155 - Associates
(1) The requirement of Article 147(1) that a take-over offer must extend to all theShares , or all theShares of any class or classes, in aCompany shall be regarded as satisfied notwithstanding that the offer does not extend toShares which associates of the offeror hold or have contracted to acquire; butShares which any such associate holds or has contracted to acquire, whether at the time when the offer is made or subsequently, shall be disregarded for the purposes of any reference in this Part to theShares to which a take-over offer relates.(2) Where during the period within which a take-over offer can be accepted any associate of the offeror acquires or contracts to acquire any of theShares to which the offer relates, then, if the condition specified in Article 149(8)(A) or (B) is satisfied as respects thoseShares they shall be treated for the purpose of that Article asShares to which the offer relates.(3) In Article 151(1)(B) and Article 151(2)(B) the reference toShares which the offeror has acquired or contracted to acquire shall include a reference toShares which any associate of his has acquired or contracted to acquire.(4) In this Article 155, "associate", in relation to an offeror, means one or more of the following:(A) a nominee of the offeror;(B) aHolding Company ,Subsidiary or fellowSubsidiary of the offeror or a nominee of such aHolding Company ,Subsidiary or fellowSubsidiary ; or(C) aBody Corporate in which the offeror is substantially interested.(5) For the purposes of Article 155(4)(B) aCompany is a fellowSubsidiary of anotherBody Corporate if both areSubsidiaries of the sameBody Corporate but neither is aSubsidiary of the other.(6) For the purposes of Article 155(4)(C) an offeror has a substantial interest in aBody Corporate if:(A) that body or its directors are accustomed to act in accordance with his directions or instructions; or(B) he is entitled to exercise or control the exercise of one-third or more of the voting power at general meetings of that body; or(C) he owns or controls directly or indirectly more than 20 percent of theShare capital.(7) Where the offeror is an individual his associates shall also include his spouse and any child or step-child of his.Amended (as from 5th April 2015). Part 14: Part 14: Interpretation and Definitions
Article 156 - Interpretation
(1) In theseRegulations , a reference to:(A) a provision of any law or regulation includes a reference to that provision as amended or re-enacted from time to time;(B) an obligation to publish or cause to be published a particularDocument shall, unless expressly provided otherwise in theseRegulations , include publishing or causing to be published in printed or electronic form;(C) a calendar year shall mean a year of the Gregorian calendar;(D) a month shall mean a month of the Gregorian calendar;(E) the masculine gender includes the feminine and the neuter;(F) writing includes any form of representing or reproducing words in legible form; and(G) references to a person includes any natural or legal person,Body Corporate , or body unincorporate, including a branch, company, partnership, unincorporated association, government or state.(2) The headings in theseRegulations shall not affect its interpretation.(3) A reference in theseRegulations to a Part, Article orSchedule by number only, and without further identification, is a reference to a Part, Article orSchedule of that number in theseRegulations .(4) A reference in theseRegulations to aSchedule , an Article or a Part using a short form description of suchSchedule , Article or Part in parenthesis are for convenience only and the short form description shall not affect the construction of the Article or Part to which it relates.(5) A reference in an Article or other division of theseRegulations to a paragraph, subparagraph or Article by number or letter only, and without further identification, is a reference to a paragraph, sub-paragraph or Article of that number or letter contained in the Article or other division of theseRegulations in which that reference occurs.(6) Each of theSchedules to theseRegulations shall have effect as if set out in theseRegulations and references to theseRegulations shall include reference to theSchedules .(7) Any reference in theseRegulations to "include", "including", "in particular" "for example", "such as" or similar expressions shall be considered as being by way of illustration or emphasis only and are not to be construed so as to limit the generality of any words preceding them.(8) References to chairman, Director General, director or similar expressions are, where the context permits, a reference to the person holding that office from time to time.Article 157 - Definitions
The following words and phrases shall where the context permits have the meanings shown against each of them:
Address in relation to a Member orOfficer of aCompany means:(A) if an individual, his usual residential address; and(B) if anEntity , its registered or principal officeAffiliated Company any Subsidiary ,Holding Company or other member of the same GroupAuthorised Firm a person that has been granted an authorisation in accordance with Part 5 of the Financial Services Regulations Body Corporate any body corporate, whether incorporated or constituted in the QFC or elsewhereBranch a branch of a Non-QFC Company registered in theQFC under theseRegulations or any otherRegulations Business includes every trade, profession and occupation Business Day a day on which banks are open for ordinary business in the QFC Cell a Cell created by aPCC for the purpose of segregating and protectingCellular Assets in the manner provided by Part 4Cell Shares Shares created and issued by aPCC in respect of one of itsCells pursuant to the provisions of Article 97, the proceeds of the issue of which (the "Cell Share Capital ") shall be comprised in theCellular Assets attributable to thatCell Cell Share Capital the proceeds of issue of Cell Shares Cellular Assets the assets of a PCC attributable to thePCC Cells pursuant to Article 95(4)Collective Investment Fund a fund which is a Collective Investment Fund for the purposes of theFinancial Services Regulations Company a company incorporated in the QFC under theseRegulations or any otherRegulations Council of Ministers the Council of Ministers of the State CRO the Companies Registration Office established pursuant to Article 7 of the QFC Law Data Protection Regulations and Rules The QFC Data Protection Regulations of 2005 and the rules issued pursuant to them. Document includes any document in writing, including, where permitted, a document in writing in electronic form Entity a Body Corporate or partnership or unincorporated association carrying onBusiness with a view to a profitFinancial Services Regulations the QFC Financial Services Regulations of 2005 Group with respect to an Entity :(A) thatEntity ;(B) anyHolding Company of theEntity ;(C) anySubsidiary (direct or indirect) of thatEntity or of anyHolding Company of thatEntity .Holding Company an Entity is a Holding Company of anotherEntity if the secondEntity is aSubsidiary of the firstEntity IFRS International Financial Reporting Standards Insolvency Regulations the QFC Insolvency Regulations of 2005 Insurer a Company registered under theseRegulations which is anInsurer for the purposes of theFinancial Services Regulations Liabilities includes any amount reasonably necessary to retain for the purpose of providing for any liability or loss which is either likely to be incurred or certain to be incurred but uncertain as to the amount or as to the date on which it will arise LLC a limited liability company incorporated under these Regulations Member a member of a Company as defined in Article 19 or Article 92(F) of theseRegulations as applicableMinister the Minister of Finance of the State Name in relation to a Member orOfficer of aCompany means:(A) if an individual, his forename and surname (or, in the case of a person usually known by a title, his title instead of or in addition to either or both his forename and surname); and(B) if anEntity , its corporate name or firm name.Nominal Capital the par value of a Share when issuedNon-Cellular Assets the assets of a PCC which are notCellular Assets Non-QFC Company a Body Corporate not incorporated in theQFC Officer any director or secretary of a Company from time to timeOrdinary Resolution a resolution passed by simple majority of such Members of aCompany as (being entitled to do so) vote in person or, where proxies are allowed, by proxy at a meeting of theCompany of which notice specifying the intention to propose the resolution has been duly givenPCC a company incorporated as, or converted into, a protected cell company in accordance with the provisions of Part 4 of these Regulations Prescribed Fee a fee prescribed in rules made or approved by the QFC Authority Prescribed Form a form prescribed by or approved by the QFC Authority Principal Representative a person appointed under Article 117(2)(A) of these Regulations QFC the Qatar Financial Centre QFC Authority the Qatar Financial Centre Authority established pursuant to Article 3 of the QFC Law QFC Civil and Commercial Court The Civil and Commercial court established purasuant to the QFC Law QFC Law Law No.(7) of 2005 of the State as amended by Law No.(2) of 2009 and Law No.(14) of 2009 Records Documents and other records however storedRegistrar the Registrar of theCRO appointed under Article 13 of these RegulationsRegulations Regulations enacted by the Minister in accordance with Article 9 of the QFC LawRegulatory Authority the Regulatory Authority of theQFC established pursuant to Article 8 of the QFC LawRegulatory Tribunal the tribunal established by the QFC Law .Schedule a schedule to these Regulations Security Regulations the QFC Security Regulations of 2011 Share a share in the capital of a Company Special Resolution a resolution passed by at least 75% of such Members of theCompany as (being entitled to do so) vote in person or, where proxies are allowed, by proxy at a meeting of theCompany of which notice, specifying the intention to propose the resolution as a special resolution, has been duly givenState the State of Qatar Subsidiary an Entity is aSubsidiary of anotherEntity if the secondEntity :(A) holds a majority of the voting rights in the firstEntity ;(B) is a member of the firstEntity (whether direct or indirect, or through legal or beneficial entitlement) and has the right to appoint or remove a majority of the board of directors of the firstEntity ;(C) has the right to exercise a dominant influence over the management and operation of that otherEntity through:(i) provisions contained in the constitutive documents of that otherEntity ; or(ii) any contractual arrangement relating to the management and operation of that otherEntity ; or(D) is a member of the firstEntity (whether direct or indirect, or through legal or beneficial entitlement) and controls alone or pursuant to an agreement with other members or members, a majority of the voting rights in the firstEntity ;or if the firstEntity is aSubsidiary of anotherEntity which is itself aSubsidiary of the secondEntity Support Services Provider a body corporate, partnership or limited liability partnership approved by the QFC Authority to provide corporate and administrative services.Transaction for the purposes of Part 4 of these Regulations, anything (including, without limitation, any agreement, arrangement, dealing, disposition, circumstance, event or relationship) whereby any liability arises or is imposed; and cognate expressions shall be construed accordingly UK GAAP generally accepted accounting principles in the United Kingdom US GAAP generally accepted accounting principles in the United States Wholly Owned Subsidiary an Entity is aWholly Owned Subsidiary of anotherEntity if the firstEntity has noMembers except:(A) the secondEntity ; and(B) wholly owned subsidiaries of, or persons acting on behalf of, the secondEntity or the secondEntity's wholly owned subsidiaries
Amended (as from 5th April 2015). Schedule 1: Contraventions with financial penalties stipulated
Article creating contravention General nature of contravention Maximum Financial Penalty (US$) 22 Failing to register a return as to allotments $2,000 23(2) Allotment of shares at a discount $2,000 24 Non-compliant registration of transfer of Shares $2,000 25 Non-compliance with requirements in relation to certificates of Shares $2,000 27(4) Company issues bearerShares $5,000 28(3) Failing to give notice of altered share capital $2,000 30(3)(a) Failing to publish reduction of capital in newspapers $2,000 30(3)(b) Failing to obtain signatures from 2 directors $2,000 30(5) Failing to give notice of a reduction in capital $2,000 33 Providing financial assistance $2,000 34 Unlawful dividend or other distribution $5,000 37, 92I Failure to register change of name with CRO $2,000 39, 92I Company failing to change name on direction ofCRO $2,000 40, 92J Improper use of " Limited Liability Company " or a "Company Limited by Guarantee " etc$2,000 42(1)(A), 92K(1)(A) Company failing to have a registered office in the QFC$2,000 42(1)(B), 92K(1)(B) Company failing to carry out its principal activity at or from the registered office without permission from the QFC Authority to carry on such activity at or from another placed within the QFC $2,000 43, 92L Failure to notify change of registered office $2,000 44, 92N Company failing to keep internal registers$2,000 45, 92O Failure of name to appear outside place of activities $2,000 46, 92P Company failing to have name etc. on certainDocuments $1,000 47, 92Q Company failing to lodge annual return$2,000 50, 92T Company failing to register alteration of Articles$2,000 52(1), 92V Failure of a Company to have at least one director$2,000 52(4), 92V Company failing to register a resignation, removal or appointment of director(s)$2,000 52(4), 92V Company failing to register a change in director's particulars$1,000 55, 92V Directors failing to comply with duties $2,000 56, 92V Director failure to disclose interest $2,000 57, 92W Company providing financial assistance to director without consent$2,000 60(1), 92V Company failing to have a Company secretary $2,000 60(3), 92V Company failing to register the appointment or resignation of a of secretary$2,000 60(3), 92V Company failing to register change of secretary's particulars$1,000 64 Company default in complying withCRO's direction to holdCompany meeting$15,000 77, 92FF Company failure to submit resolutions toCRO $2,000 80(1), 92HH Non-compliant maintenance of accounting Records $1,000 80(2)(A) and (B), 92HH Failure to keep and preserve accounting Records $2,000 80(2)(C), 92HH Failure to keep accounting Records open to inspection$10,000 82(3), 92HH Failure of directors to approve and sign accounts $5,000 82(4), 92HH Failure to comply with requirements within 4 months $10,000 82(5), 92HH Failure to file accounts with the CRO $2,000 83(3), 92HH Failure to provide accounts $10,000 84 Publication of accounts without auditors' report $5,000 85 Acting as auditor when not qualified $10,000 86(1) Failure to register the initial appointment of, or a change in respect of its auditor $2,000 86(6) Company failing to notify the CRO of the removal of auditor $10,000 88 Failure of auditor to comply with resignation requirements $5,000 88(4) Failure to file auditor's resignation with CRO $10,000 89 Failure of auditor to make a report as required $5,000 90(1) and (2) Auditor failing to fulfil duties $5,000 90(3), (4), (5) and 91 Company and officers etc. not co-operating with auditor$5,000 92 Company and officers etc. obstructing auditor$5,000 92M(3) Failure of an LLC(G) to notify the CRO of changes concerning itsSupport Services Provider .$2,000 105 Failure to inform persons they are dealing with a PCC $2,000 117(2)(B) Failure to maintain a principal place of business $2,000 117(2)(C) Failure of Branch to give notice of change of particulars$2,000 120(3) Failure of Branch to change name on direction ofCRO $2,000 121 Failure of Branch to give particulars ofPrincipal Representative $2,000 122(2) Failure of Branch to give notice of change of particulars$2,000 123 Failure of Branch to keep and preserve accounting records$2,000 124 Failure of Branch to have name etc. on certain documents$1,000 125 Failure of name of Branch to appear outside place of business$2,000 130 Failure to comply with direction of CRO $15,000 132 Provision of false or misleading information to the CRO $50,000 149(5) Failure to sign declaration $5,000 151(3) Offeror failing to give minority Member notice of rights$5,000
Amended (as from 5th April 2015). Schedule 2: Financing change statement
Table 1
Condition Secured party may be required to file financing change statement as shown The obligations under all of the Security Agreements to which the financing statement relates have been performed or the Secured Party is required by the QFC Law orRegulations to release the Collateral.To discharge the filing. The Secured Party has agreed to release part or all of the Collateral described in the financing statement. To amend or discharge the filing (as the case may be) so as to reflect the terms of the agreement. The description of the Collateral contained in the financing statement includes an item or kind of Personal Property that is not Collateral under a Security Agreement between the Secured Party and the Debtor. To amend the Collateral description in the kinds of Personal Property that are not Collateral under a Security Agreement between the Secured Party and the Debtor. No Security Agreement exists between the persons named in the financing statement as the Secured Party and the Debtor. To discharge the filing.
Amended by QFCA RM2012-1 (as from 11th April 2012) Endnotes
1 Abbreviation key
a = after om = omitted/repealed am = amended orig = original amdt = amendment par = paragraph/subparagraph app = appendix prev = previously art = article pt = part att = attachment r = rule/subrule b = before renum = renumbered ch = chapter reloc = relocated def = definition s = section div = division sch = schedule g = guidance sdiv = subdivision hdg = heading sub = substituted ins = inserted/added 2 Regulation history
Companies Regulations 2005
Made: 14 September 2005
Commenced: 14 September 2005
as amended by
Companies Regulations (Amended) 2008/01
Made: 4 May 2008
Commenced: 4 May 20083 Amendment history
Power of QFC Authority and QFC Regulatory Authority to make rules
art 5A ins 2008/01
Role of the QFC Authority
art 7 am 2008/01
Incorporation of a Limited Liability Company
art 17 am 2008/01
Members
art 19 am 2008/01
Return as to allotments
art 22 am 2008/01
Share premium account
art 26 am 2008/01
Reduction of share capital
art 30 am 2008/01
Redemption or purchase of own Shares
art 31 am 2008/01
Duty to deliver annual returns
art 47 am 2008/01
Appointment of directors
art 52 am 2008/01
LLC accounts
art 82 am 2008/01
QFC Legislation