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 the
QFC.(2) An LLCis a Companywhich is formed by being incorporated under Part 3 of these Regulations.(3) Where an LLChas 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 an LLC(Public) as if it were an LLC. If at any time an LLC(Public) is no longer listed on the QSE or other exchange, it will cease to be designated LLC(Public). Amended (as from 5th April 2015).
Article 15 - Corporate Capacity(1) An
LLChas separate legal personality from its Memberswhose liability shall be limited to paying to the LLCthe amount, if any, unpaid on the Sharesheld by them.(2) An LLChas 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 the LLCis party, the power of the directors of an LLCto bind the LLC, or authorise others to do so, shall be deemed free of any limitation under the LLC'sarticles of association.(4) A contract may be made, varied or discharged on behalf of an LLC, by any person acting under its authority, express or implied.(5) A Documentis executed by an LLCif signed by two directors, or one director and the secretary of an LLC, and expressed (in whatever form of words) to be executed by the LLC. 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 an
LLC, or by a person as agent for an LLC, at a time when the LLChas 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 the LLCor as agent for it, and he is personally bound by the transaction and entitled to its benefits.(2) An LLCmay, 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 an
LLCfor the purpose of carrying on a Businessof a kind permitted by the QFC Lawto be conducted in the QFCby signing and filing with the CROan incorporation document together with the Prescribed Feeand otherwise complying with the requirements of these Regulationsin respect of registration.(2) The Prescribed Formand incorporation document filed with the CROshall set out or have attached thereto:(A) the name of the LLCwhich must comply with Article 36 of these Regulations;(B) the nature of the Businessto be conducted by the LLCand it shall be sufficient to state that the purpose of the LLCis to engage in any lawful act or activity for which LLCsmay be incorporated under the QFC Lawand Regulations;(C) the address of the registered office of the LLC, which shall be in the QFC;(D) the date of the financial year end of the LLC;(E) the full Nameand Addressof each of the incorporators of the LLCand the number of Shareseach of them agrees to take upon incorporation of the LLC;(F) 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 LLCtogether with a declaration that each of them is qualified to act as a director or secretary of an LLCpursuant to these Regulations;(G) the full Name, Address, date of birth and nationality of the person who is the first secretary of the LLC;(H) the amount of the authorised share capital, with which it is proposed that the LLCbe registered, and the division thereof into Sharesof fixed amount;(I) the LLC'sarticles of association, signed by the incorporators, setting out the rules for the internal governance of the LLCwhich shall comply with these Regulations; and(J) such other particulars as the CROmay require from time to time.(3) The share capital of an LLCmay be denominated in any currency approved by the CRO.(4) The incorporation document and all other documentation required to be submitted to the CROshall be in English and shall be in such form as the CROmay prescribe or approve from time to time.(5) Article 17(2)(E) does not require the incorporators of an LLCto agree to take any Sharesif, on incorporation, the LLCwill be a Collective Investment Fund.(6) Article 17(2)(H) does not apply if, on incorporation, the LLCwill be a Collective Investment Fund.(7) An LLCthat is a Collective Investment Fundis not required to have an authorised share capital. Amended (as from 5th April 2015).
Article 18 - Registration(1) No
LLCshall be incorporated without the consent of the CRO.(2) On incorporation the CROshall:(A) give a certificate that the LLCis incorporated with the name specified in the certificate and with effect from the date of the certificate;(B) allocate to the LLCa number, which shall be the LLC'sregistered number; and(C) enter the name and registered number of the LLCin the index of names and registered numbers maintained by the CROunder these Regulations.(3) A certificate of incorporation shall be conclusive evidence that the LLCis incorporated with the name specified in it and that the requirements of these Regulationshave been complied with in respect of the incorporation and registration of the LLCand 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, the LLCshall be a Body Corporatehaving the name contained in the certificate of incorporation and capable forthwith of exercising all the functions of an incorporated LLC.(5) A decision of the CROrefusing to issue a certificate of incorporation may be reviewed consistent with any applicable standards and procedures issued by the QFC Authorityfor such purpose. Amended (as from 5th April 2015).
Section 3: Section 3: Members and Share Capital
Article 19 - Members(1) The incorporators of an
LLCare deemed to have agreed to become Membersof the LLCby signing the incorporation document and on incorporation shall be entered as such in the LLC'sregister of Members(persons other than incorporators who have died or been dissolved).(2) Every other person who agrees to become a Memberof the LLCand whose Nameis entered in the register of Members, is a Memberof the LLC.(3) A person may cease to be a Memberof an LLC(as well as by death or dissolution) in accordance with the articles of association of the LLC.(4) A Memberof an LLCcan be of any nationality and either a natural or a Body Corporate.(5) The minimum number of Membersof an LLCis one.(6) Every LLCshall keep a register of Members, together with:(A) a statement of the Sharesheld by each Member, distinguishing each Shareby its number (if the Sharehas a number) and, where the LLChas more than one class of issued Shares, by its class;(B) the date on which each person was registered as a Member; and(C) the date on which any person ceased to be a Member.(7) Article 19 (1) does not apply to an LLCif, on incorporation, the LLCwill be a Collective Investment Fund. Amended (as from 5th April 2015).
Article 20 - Rectification of register of Members(1) If:(A) the
Nameof a person, the number of Sharesheld or the class of Sharesheld is, without sufficient reason, not entered in or omitted from an LLC'sregister of Members; or(B) there is a failure or unnecessary delay in entering on the register the fact of a person having ceased to be a Membera person aggrieved, or a Memberof the LLC, may apply to the CROfor rectification of the register.(2) The CROmay refuse the application or may order rectification of the register.(3) Whether or not the CROexercises its power under Article 20(2), the QFC Civil and Commercial Courtmay make one or more of the following orders:(A) on application of the CRO, an order enforcing any orders made by it under this Article 20;(B) on application of a person aggrieved, a Memberof the LLC, or the LLC, an order directing the CROto, 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 LLCto 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
Sharesof an LLCshall be at the disposal of the directors of an LLCwho may, subject to any rights previously conferred on the holders of any existing Shares, or class of Shares, offer, allot, grant options over or otherwise dispose of such Sharesto such persons, at such time and upon such terms as the directors of the LLCmay determine.
Article 22 - Return as to allotments(1) When an
LLCmakes an allotment of its Shares, the LLCshall within 1 month thereafter deliver to the CROfor registration a return of the allotments in the Prescribed Formstating the number and nominal amount of the Sharescomprised in the allotment, the Namesand Addressesof the allottees, and the amount (if any) paid or due and payable on each Share, whether on account of the nominal value of the Shareor by way of premium, and, in the event that any Sharesare 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 an LLCthat is a Collective Investment Fund. Amended (as from 5th April 2015).
Article 23 - Prohibition on allotment of Shares at a discount(1) An
LLC's Sharesshall not be allotted at a discount to their nominal value.(2) If any Shareis allotted in contravention of this Article 23 then the allottee is liable to pay the LLCan amount equal to the amount of the discount, with interest at an appropriate rate to be prescribed by the CRO.
Article 24 - Transfer of Shares(1) The
Sharesof any Memberof an LLCshall be transferable in such manner as may be provided by the articles of association of the LLC.(2) Subject to Article 24(6), notwithstanding the provisions of its articles of association, an LLCshall not register a transfer of Sharesin the LLCunless 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 the LLC. For the purposes of trading, an LLC(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 the LLC(Public).(3) Nothing in this Article 24 shall prejudice the power of an LLCto register as a Memberany person to whom the right to any Sharesof the LLChas been transmitted by operation of law.(4) A transfer of any Shareof a deceased Memberof an LLCmade by his personal representative, although the personal representative is not himself a Memberof the LLC, is as valid as if he had been a Memberat the time of the execution of the instrument of transfer.(5) If an LLCrefuses to register a transfer of Shares, the LLCshall, within 21 days after the date on which the transfer was delivered to the LLC, 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 the QFC Authority. Amended (as from 5th April 2015).
Article 25 - Issue of certificates(1) Subject to Article 25(3), for each
Shareallotted or transferred, a Sharecertificate shall be issued by the LLCno later than 30 days after the date the allotment is made or the date on which a transfer of the Sharesis registered in the register of Membersof the LLC. For an LLC(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 the LLC(Public).(2) A certificate executed by the LLCspecifying any Sharesheld by a Member, shall be evidence of the title of the Memberto the Shares. For an LLC(Public) a record of title to any Shares in the LLC(Public) held in the QSE or the relevant exchange's registry or system will be evidence of good title to any Sharesheld by the Member.(3) Article 25(1) and (2) do not apply when title to shares is evidenced in accordance with rules made by the QFC Authoritywhich allow for title to be evidenced in some other manner. Amended (as from 5th April 2015).
Article 26 - Share premium account(1) If an
LLCissues Sharesat a premium to their nominal value, whether for cash or otherwise, a sum equal to the aggregate amount or value of the premiums on those Sharesshall be transferred to an account called the "share premium account".(2) The Share Premium Account may be applied by the LLC:(A) in paying up unissued Sharesto be allotted to Membersas fully paid bonus Shares;(B) or in writing off:(i) the LLC'spreliminary expenses; or(ii) the expenses of, or the commission paid or discount allowed on, any issue of Sharesor debentures of the LLC(C) or in providing the premium payable on redemption of any redeemable Sharesor any debentures of the LLC.(3) Subject to Article 26(2), the provisions of these Regulationsrelating to a reduction of a Company'sshare capital apply as if the Share Premium Account were part of its paid up share capital.
This Article does not apply to an
LLCthat is a Collective Investment Fund. Amended (as from 5th April 2015).
Article 27 - Rights attaching to Shares(1) To the extent permitted by its articles of association, an
LLCmay create different classes of Shares. Subject to these Regulations, the rights attaching to Shares(or any class of Shares) shall be determined by the articles of association of the LLC.(2) The articles of association of the LLCshall set out:(A) the right to vote at a meeting of the LLCcarried by each class of Share;(B) the right to repayments of capital attaching to each class of Share;(C) the right to participate in any undistributed profit of each class of Share;(D) the rights and obligations pertaining to the transfer of each class of Share;(E) the right to dividends and other distributions attaching to each class of Share; and(F) any other rights and obligations attaching to each class of Share.(3) Subject to the provisions of the articles of association of the LLC, each Shareshall rank in all respects equally with any other Sharein the LLC.(4) It shall not be lawful for an LLCto issue bearer Shares.
Article 28 - Alteration of share capital(1) An
LLC, if so authorised by its articles of association, may alter its share capital by Ordinary Resolutionin any of the following ways:(A) increasing its authorised share capital by creating new Sharesof such amount as it deems necessary;(B) consolidating and dividing any or all of its Shares(whether issued or not) into Sharesof a larger amount than its existing Shares;(C) sub-dividing its Shares, or any of them, into Sharesof a smaller amount than its existing Sharesbut so that, in the sub-division of any issued Shares, the proportion between the amount paid and the amount (if any) unpaid on each reduced Shareshall be the same as it was in the case of the Sharefrom which the reduced Shareis derived;(D) cancelling Shareswhich at the date of passing of the Ordinary Resolutionto cancel them, have not been taken or agreed to be taken by any person, and diminishing the amount of the LLC'sauthorised share capital by the amount of the Sharesso cancelled; and(E) changing the currency denomination of its share capital or any class thereof to a currency denomination approved by the CRO.(2) A cancellation of Sharesunder this Article 28 does not for the purposes of these Regulationsconstitute a reduction of share capital.(3) An LLChaving altered its share capital pursuant to Article 28(1), shall within 21 days thereafter give notice in the Prescribed Formto the CRO, together with a copy of the Ordinary Resolutioneffecting 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 of
Sharesis made in the articles of association of the LLC, those rights may only be varied in accordance with those provisions.(2) If provision for the variation of the rights attached to a class of Sharesis 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 the Sharesof the class consent in writing to the variation; or(B) a Special Resolutionpassed 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 of Shares, 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 of Sharesare varied in the manner referred to above, the holders of not less than 15 percent of the nominal value of the Sharesof the class (being persons who did not consent to, or vote in favour of a resolution for the variation) may apply to the QFC Civil and Commercial Courtto 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 the Membersentitled to make it by one or more of them as they may appoint in writing.(6) On any such application the QFC Civil and Commercial Court, after hearing the applicant and any other persons who apply to the QFC Civil and Commercial Courtto be heard and appear to the QFC Civil and Commercial Courtto 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 the Membersrepresented by the applicant, disallow the variation and shall, if not so satisfied, confirm the variation.(7) The decision of the QFC Civil and Commercial Courton 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) An
LLC, if authorised by an Special Resolutionand its articles of association, may reduce its Sharecapital in any way.(2) In particular, and without prejudice to the generality of Article 30(1), an LLCmay:(A) extinguish or reduce the liability on any of its Sharesin respect of capital not paid up;(B) either with or without extinguishing or reducing liability on any of its Shares, 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 its Shares, pay off any paid up capital that is in excess of the requirements of the LLC.(3) No LLCshall 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, the LLCshall publish a notice in an newspaper approved by the CROstating the amount of the LLC'sshare 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 the LLCor 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 the LLC'sassets will be not less than the aggregate of its Liabilitiesand issued share capital and Share Premium Account and the LLCwill be able to satisfy its Liabilitiesas they fall due; or(ii) that all the creditors of the LLCon that date have consented to the reduction.(4) Where Sharesare to be cancelled in order to reduce the capital of an LLCthe Sharesshall be acquired at the lowest price at which, in the opinion of the directors, the Sharesare obtainable, but not exceeding an amount, if any, stated or determined by the articles of association.(5) Where an LLCreduces the amount of its share capital then within 30 days after the date on which the reduction has effect the LLCshall file a notice in Prescribed Formwith the CROtogether 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 the LLCwhich the LLCis unable to pay as a result of the reduction, every person who was a Memberof the LLCat 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 the Sharesthen held by him.(7) Notwithstanding Article 30 (1), an LLCthat is a Collective Investment Funddoes not require authorisation by Ordinary Resolutionto reduce its share capital in anyway. Amended (as from 5th April 2015).
Article 31 - Redemption or purchase of own Shares(1) An
LLCmay, if authorised to do so by its articles of association, and in accordance with the provisions of such articles of association, redeem any of its Shareswhich pursuant to its articles of association are to be redeemed, or are liable to be redeemed, at the option of the LLCor the holder of the relevant Shares.(2) No redeemable Sharesshall be issued by an LLC, nor shall any Sharesin an LLCbe converted into redeemable Shares, if, following such issue or conversion, there would be no Sharesin the LLCwhich are not redeemable.(3) A redemption of redeemable Sharesshall only be made from the following sources:(A) in the case of the nominal value of the Shares, from paid up capital, share premium and other reserves of the LLC; or(B) in the case of any premium, from realised or unrealised profits, share premium or other reserves of the LLC.(4) Upon redemption of Sharesunder this Article 31, such Sharesshall be taken as cancelled and accordingly the amount of the LLC'sissued share capital shall be diminished by the nominal value of those Sharesbut redemption shall not be taken as reducing the authorised share capital of the LLC.(5) Where pursuant to this Article 31 an LLCis about to redeem Shares, it may issue Sharesup to the nominal amount of the Sharesto be redeemed as if those Shareshad never been issued.(6) This Article does not apply to an LLCthat is a Collective 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, an
LLCmay purchase its own Shares(including any redeemable Shares).(2) Article 31(3), (4), and (5) shall apply to the purchase by an LLCof its own Shares(the "Purchased Shares") as they apply to a redemption of redeemable Sharesof an LLC. However, if an LLCdecides, 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 a Member; (c) no right to receive any dividends; and (d) no rights to receive assets upon the LLC'sliquidation.(3) A purchase under this Article must, unless the LLCis a Wholly Owned Subsidiary, be sanctioned by an Ordinary Resolution.(4) The Sharesto be purchased:(A) may only be purchased in pursuance of a contract approved in advance by an Ordinary Resolutionof the LLC; and(B) shall not carry the right to vote on the Ordinary Resolutionauthorising the purchase.(5) An LLCmay not under this Article purchase its Sharesif as a result of the purchase there would no longer be a Memberof the LLCholding Shares. Amended (as from 5th April 2015).
Article 33 - Prohibition of financial assistance(1) An
LLCshall not (directly or indirectly) provide financial assistance to a person to acquire its Sharesor Shares in its Holding Companyunless:(A) the giving of the financial assistance does not materially prejudice the LLC'sability to discharge its Liabilitiesas they fall due;(B) the giving of the financial assistance is approved by resolution of the Membersholding not less than 90 percent of the nominal value of the Sharesgiving a right to attend and vote at any meeting of Members; or(C) the LLC'sordinary Businessincludes providing finance and financial assistance is given in the ordinary course of that Businessand 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 the LLC'sassets by way of dividend lawfully made or a distribution made in the course of the LLC'swinding up;(B) the allotment of bonus Shares;(C) a reduction of capital in accordance with these Regulations; or(D) a redemption or purchase of Sharesin accordance with these Regulations. 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, an
LLCmay, by a resolution of its directors, declare and pay or make dividends or other distributions in money, Sharesor other property.(2) An LLCshall not declare, make or pay any dividend or other distribution if there are reasonable grounds for believing that:(A) the LLCwould after the payment of the dividend or making of the distribution be unable to satisfy its Liabilitiesas they become due; or(B) the realisable value of the LLC'sassets would thereafter be less than the aggregate of its Liabilitiesand 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
LLCto any of its Membersis made in contravention of Article 34 and, at the time of such dividend or other distribution, the Memberknows or has reasonable grounds for believing that it is so made, he is liable to repay it, or that part of it, to the LLCor, in the case of a dividend or other distribution made otherwise than in cash, to pay the LLCa 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 the CRO.
Section 4: Section 4: Names and Change of Names
Article 36 - Registration of name(1) The name of an
LLCmust:(A) be written using letters of the English alphabet or such other characters acceptable to the CRO; and(B) end with:(i) the expression "Limited Liability Company"; or(ii) the abbreviation "llc" or " LLC".(2) An LLCshall 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" or LLC";(B) which is the same as a name appearing on the index of names maintained by the CROor by the Ministry of Economy and Commerce in the State; or(C) which in the opinion of the CROis offensive or otherwise undesirable.(3) Except with the approval of the CRO, an LLCshall not be registered by a name which in the opinion of the CROwould be likely to give the impression that it is connected in any way with the State. Amended (as from 5th April 2015).
Article 37 - Change of name(1) An
LLCmay, by Special Resolution, change its name at any time to another name with which an LLCmay be registered under Article 36.(2) Where an LLCchanges its name it shall deliver, within 21 days of the Special Resolution, a notice to the CROand shall pay to the CROthe Prescribed Fee.(3) A notice delivered under Article 37(2):(A) shall be in a form prescribed or approved by the CRO; and(B) shall be signed by a director or secretary of the LLCor authenticated in a manner approved by the CRO.(4) Where the CROreceives a notice under Article 37(2) it shall (unless the new name is one by which an LLCmay 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
LLCdoes 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 an
LLChas been registered by a name which:(A) is the same or, in the opinion of the CRO, too like a name appearing at the time of registration in the index maintained by the CRO; or(B) is the same as or, in the opinion of the CRO, too like a name which should have appeared in the index at that timethe CROmay within 12 months of that time in writing direct the LLCto change its name within such period as it may specify.(2) If it appears to the CRO:(A) that misleading information has been given for the purpose of the registration of an LLCby 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 the LLCto change its name within such period as the CROmay specify.(3) If in the CRO'sopinion the name by which an LLCis 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 the LLCto change its name within such period (being not less than 1 month) as the CROmay specify.(4) The LLCmay, within 3 weeks from the date of any direction under Article 39(1), (2) or (3), apply to the Regulatory Tribunalto set it aside and the Regulatory Tribunalmay 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 an LLCis to change its name, the CROmay 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 a
Businessunder 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 an LLCor a Branchof a Non-QFC Companywhose corporate name includes the words "limited liability company" or an abbreviation thereof, contravenes these Regulations.
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) An
LLCshall:(A) at all times have a registered office situated in the QFC; and(B) carry on its principal Businessactivity at or from the registered office unless the QFC Authoritypermits such Businessactivity to be carried on at or from another place within the QFC.(2) On the incorporation of an LLCthe situation of its registered office shall be that stated in the incorporation document.(3) A Documentmay be served on an LLCby leaving it at, or sending it by hand or by fax or by courier to, the registered office of the LLC.
Article 43 - Change of registered office(1) An
LLCmay change its registered office by delivering notice of the change within 21 days to the CROtogether with payment of the Prescribed Fee.(2) A notice delivered under Article 43(1):(A) shall be in the Prescribed Form; and(B) shall be signed by a director or secretary of the LLCor authenticated in a manner approved by the CRO.(3) Where the CROreceives 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 the CROin accordance with Article 43(2) being registered by the CRO, but until the end of the period of 21 days beginning with the date on which it is registered a person may validly serve any Documenton the LLCat its previous registered office.(5) Where an LLCunavoidably ceases to perform at its registered office any duty to keep at its registered office any register, index or other Documentor to mention the address of its registered office in any Documentin circumstances in which it was not practicable to give prior notice to the CROof 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 the CROof 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) Every
LLCshall keep the following internal registers at its registered office address:(A) Register of Membersas provided for in Article 19(6);(B) Register of directors and secretary, including Name, Address, nationality, date of birth and business occupation;(C) Register of transfers of Shares, including Nameand Addressof transferor and transferee, date of transfer and number and class of Sharestransferred; and(D) Register of allotments of Shares, including Nameof applicant, date of application and allotment and number and class of Shares.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 of Members..(2) Any Membermay without charge, and any other person may upon payment of any reasonable fee required by the LLC, visit the registered office during the office hours of the LLCin 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, any Membermay 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) Every
LLCshall paint or affix, and keep painted or affixed, its name on the outside of every office or place in which its Businessis carried on, in a conspicuous position and in letters easily legible.(2) If an LLCdoes not paint or affix, and keep painted or affixed, its name as required above, the LLCand every Officerof it who is in default is in contravention of these Regulations.
Article 46 - Disclosures required of an LLC in the use of its name(1) The name of an
LLC, its registered number, and the address of its registered office shall appear in legible characters in all its Businessletters, written orders for goods or services, invoices and receipts, written demands for payment and other such similar Documentation.(2) If an Officerof an LLCor a person on its behalf:(A) issues or authorises the issue of any Businessletter of the LLC, or any Documentmentioned in Article 46(1), in which the LLC'sname is not so mentioned as required by Article 46(1); or(B) signs or authorises to be signed on behalf of the LLCany bill of exchange, promissory note, endorsement, cheque or order for money or goods in which the LLC'sname is not mentioned as required by Article 46(1)he is in contravention of these Regulationsand 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 the LLC).
Section 7: Section 7: Annual Return
Article 47 - Duty to deliver annual returns(1) Every
LLCshall deliver to the CROsuccessive 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, that is:(A) the anniversary of the incorporation of the LLC; or(B) if the last return delivered by the LLCin 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 the Prescribed Form;(B) contain the information required by Article 48;(C) be signed by a director or secretary of the LLC; and(D) be delivered to the CROtogether with payment of the Prescribed Fee.(3) If an LLCfails to deliver an annual return in accordance with this Article 47 before the end of the period of 28 days after the return date, the LLCshall be in contravention of these Regulations. 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 the LLCto the CRO.(4) Where an LLCis in contravention of these Regulationsunder Article 47(3) every director of the LLCis similarly liable unless he shows that he took all reasonable steps to avoid the commission of or the continuance of the contravention of these Regulations.(5) This Article does not apply to an LLCthat is a Collective 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 of
Members, the Nameand Addressof each Memberof the LLCholding more than 1% in nominal value of all the issued shares of that class;(2) the Name, Address, nationality, date of birth and Businessoccupation of each of the directors and the secretary of the LLC;(3) the registered office of the LLC;(4) the authorised and issued share capital of the LLC;(5) the principal Businessactivities of the LLCin the year in question;(6) the Nameand Addressof the auditor of the LLC; and(7) any other information as may be prescribed by the CRO. Amended (as from 5th April 2015).
Section 8: Section 8: Articles of Association
Article 49 - Standard articles of association(1) The
CROmay 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 LLCarticles of association.(2) If the CROprescribes standard articles of association, an LLCmay, 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 the CRO, the alteration will not affect the articles of association of an LLCregistered before the alteration takes effect.
Article 50 - Alteration of articles of association(1) An
LLCmay by Special Resolutionalter 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 the Special Resolutionor such later time as shall be specified in it.(3) Any alteration to the articles of association must be registered on the Prescribed Form, accompanied by the payment of the Prescribed Fee, with the CROwithin 21 days of the Special Resolutionto alter it being passed by the Members. Amended by QFCA RM2012-1 (as from 11th April 2012)
Article 51 - Articles binding on LLC and Members(1) Subject to the provisions of these
Regulations, the articles of association when registered with the CRObind an LLCand its Membersto the same extent as if they had been executed by the LLCand by each Member, and contained covenants on the part of the LLCand each Memberto observe all the provisions of the articles of association.(2) A Memberof an LLCis not bound by an alteration made in the articles of association after the date on which he became a Member, if and so far as the alteration:(A) requires him to take or subscribe for more Sharesthan 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 the LLC'sshare capital or otherwise pay money to the LLC.(3) An LLCshall, upon request by a Member, send such Membera copy of its articles of association including all alterations thereto, subject to the Memberpaying the reasonable cost thereof.
Section 9: Section 9: Directors and Secretary
Article 52 - Appointment of directors(1) An
LLCshall 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 the QFCor in any other place;(C) is an undischarged bankrupt in any country; or(D) is a Body Corporate, unless—(i) the Body Corporateis an Authorised Firm; and(ii) the LLCis a Collective Investment Fund.(3) The first directors of an LLCshall be those named in the incorporation document and thereafter the directors, subject to the provisions of these Regulationsand any other Regulations, shall be appointed and removed and shall hold and vacate office as provided in the articles of association of the LLC.(4) The particulars of each director appointed, removed or who resigns and any change in the particulars of the directors of an LLCfrom time to time, shall be registered with the CROin the Prescribed Formand no later than 21 days after such change, together with payment of any Prescribed Fee. For each director appointed these particulars shall include his Name, 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 these Regulations.(5) The articles of association of an LLCmay 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 the
LLCand the director and without prejudice to any other power to remove a director which may exist apart from this Article 53, an LLCmay by Ordinary Resolutionat 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 the Membersof the LLCunder 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
LLCmay collectively exercise all powers of the LLCin accordance with its articles of association, save to the extent that these Regulationsor any other Regulationsor any rules made by the QFC Authorityor the LLC'sarticles of association require any such powers to be exercised by the Membersof the LLC.
Article 55 - Duties of directors(1) A director of an
LLCowes a duty to the LLCto 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 an Ordinary Resolutionof the LLC, be liable to compensate the LLCfor any loss suffered by the LLCand to account to the LLCfor 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 the LLC;(B) act in accordance with the articles of association of the LLCand decisions of the LLCtaken in accordance with these Regulationsand 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 these Regulationsor 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 the LLCor any opportunity of the LLCof 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 an
LLCwho has a direct or indirect interest of which he is aware in a transaction entered into or proposed to be entered into by an LLCor by a Subsidiaryof the LLC, shall disclose to the directors of the LLCthe 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 a Body Corporatelisted on any stock exchange shall not constitute an interest requiring disclosure under this Article 56.(4) A notice in writing given to the LLCby 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 an Ordinary Resolutionat a general meeting of the LLCat which the nature of the director's interest in the transaction was properly disclosed, be liable to account to the LLCfor any profit, gain or benefit obtained by the director in connection with the transaction.(6) A sole director of an LLCwho 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 the LLC'sregistered office and shall be made available there for inspection by any Memberand the LLC'sauditor without charge during the office hours of the LLC. Amended (as from 5th April 2015).
Article 57 - Prohibition of financial assistance to directors(1) Without the consent of any
Memberor Membersholding in the aggregate not less than 90 percent of the total voting rights of all the Membershaving the right to vote at any meeting of the Membersit shall not be lawful for an LLCto make a loan or similar form of financial assistance to any person who is its director or a director of its Holding 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 the LLCor for the purpose of enabling him properly to perform his duties as an Officerof the LLC;(B) in the case of an LLCwhose ordinary Businessincludes the lending of money or the giving of guarantees in connection with financial assistances made by other persons, to anything done by the LLCin the ordinary course of that Business; or(C) any financial assistance prescribed in rules made by the QFC 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 the LLCgiven 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 the LLCis 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 the LLCis 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 the LLCagainst 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 of Businessof an LLCif 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) a Body Corporateof 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 an
LLCto make to a director of the LLCany 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 to Membersof the LLCand the proposal being approved by Ordinary Resolution. This Article 58 does not affect the ability of an LLCto pay compensation to a director in connection with the termination of his employment by the LLC.(2) Where a payment which is unlawful under this Article 58 is made to a director, he shall be liable to repay it to the LLC, 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) Every
LLCshall have at all times an appropriately qualified secretary.(2) The first secretary of an LLCshall 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 an LLCor 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 an LLCfrom time to time, shall be registered with the CROin the Prescribed Form, together with payment of the Prescribed Fee, and within 21 days of such change. For each secretary appointed these particulars shall include his Name, date of birth, Addressand nationality and in the case of a Body Corporateits 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), an
LLCmay in its articles of association or in any contract or arrangement between the LLCand any Officer, or any person employed by the LLCas auditor, exempt such Officeror person from, or indemnify him in respect of any negligence, default, breach of duty or breach of trust of which the Officeror person may be guilty in relation to the LLCor any Subsidiarythereof.(2) Any provision whether contained in the articles of association of the LLCor in any contract or arrangement between the LLCand any Officer, or any person employed by the LLCas auditor, exempting such Officeror 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 the LLCshall be void provided that, notwithstanding anything in this Article 61 an LLCmay, in pursuance of any such provision as aforesaid, indemnify any such Officeror 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
LLCmay purchase and maintain insurance for the benefit of any Officerof the LLCagainst any liability incurred by him in his capacity as an Officerof the LLCor indemnifying such an Officerin 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 the Officermay be guilty in relation to the LLCor any Subsidiarythereof and nothing in these Regulationsshall make any such policy void or voidable.
Section 10: Section 10: Meetings and Resolutions
Article 63 - General meetings(1) A meeting of the
Membersof an LLCshall be convened at least once in every calendar year (save that provided an LLCshall 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 the Membersof an LLCor the holders of any class of Sharesthereof; 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), the
CROmay, on the application of any Officeror Memberof the LLC, call or direct the calling of, a general meeting of the LLC.(2) The LLCshall comply with any direction of the CROmade under Article 64(1).
Article 65 - Requisition of general meetings(1) Notwithstanding anything in its articles of association, the directors of an
LLCshall, on requisition by Membersholding the requisite Shares, proceed to call a special general meeting or as the case may be a meeting of any class of Membersof the LLCto 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 "requisite Shares" means not less than 10 percent in nominal value of the Shareswhich 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 the LLCmarked for the attention of the directors. The requisition may consist of several Documentsin 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 the LLC, and any sum so repaid shall be retained by the LLCout of any sums due or to become due from the LLCby 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 an
LLCor a meeting of any class of Membersof an LLCmay, 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 the Membershaving a right to attend and vote at the meeting, together holding not less than 95 percent of the nominal value of the Sharesof the LLCgiving a right to attend and vote at that meeting.(3) A notice of a general meeting of the LLCshall:(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 a Special Resolutionis to be proposed at the meeting set out the intention to propose a Special Resolutionand attach a copy of the proposed Special Resolutionto 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 the
LLCor of the holders of any class of Sharesin the LLCinsofar as the articles of association of the LLCdo not make other provision in that behalf:(A) notice of every meeting shall be given to every Memberentitled to receive it by delivering it to his registered address, being his address recorded in the register of Membersor such other address as the Membershall notify to the LLCfor delivery of notices from time to time;(B) (save in the case of an LLChaving a single Member) two Memberspersonally present shall be a quorum;(C) any Memberelected by the Memberspresent at a meeting may be chairman of it; and(D) every Memberhas one vote for every Shareheld by him.(2) Notwithstanding any provision to the contrary in the articles of association of an LLCwhich has a single Member, at any meeting thereof one Memberpresent in person or by proxy shall be a quorum. Amended (as from 5th April 2015).
Article 68 - Proxies(1) A
Memberof an LLCentitled to attend and vote at a meeting of it (including a meeting of holders of any class of Sharesin it) is entitled to appoint another person (whether a Memberor not) as his proxy to attend and vote instead of him and a proxy appointed to attend and vote instead of a Memberhas the same right as the Memberto speak at the meeting.(2) In every notice calling a meeting of an LLCthere shall appear with reasonable prominence a statement that a Memberentitled 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 a Member.(3) A provision contained in an LLC'sarticles of association is void insofar as it would have the effect of requiring the appointment of a proxy or any Documentnecessary to show the validity of, or otherwise relating to, the appointment of a proxy, to be received by the LLCor 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 an
LLC'sarticles 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 of Members, 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 five Membershaving the right to vote on the question;(ii) by a Memberor Membersrepresenting not less than 10 percent of the total voting rights of all the Membershaving the right to vote on the question; or(iii) by a Memberor Membersholding not less than 10 percent in nominal value of the Sharesin the LLCconferring 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 a Memberis the same as a demand by the Member.(3) On a poll taken at such a meeting, a Memberentitled 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) An
Entitymay:(A) if it is a Memberof an LLCauthorise such person as it thinks fit to act as its representative at any meeting of the LLCor at any meeting of any class of Membersof the LLC; and(B) if it is a creditor (including a holder of debentures), of an LLC, authorise such person as it thinks fit to act as its representative in any meeting of any creditors of the LLCheld in pursuance of these Regulationsor any other Regulations, 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 the Entitywhich it represents as that Entitycould exercise as if it were an individual Member, creditor or holder of debentures in the LLC.
Article 71 - Circulation of Members' resolution(1) Subject as provided in this Article, it shall be the duty of an
LLC, on the requisition in writing of such number of Membersas is herein after specified, at the expense of the requisitionists unless the LLCresolves otherwise:(A) to give the Membersof the LLCentitled 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 to Membersentitled 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 of Membersnecessary for requisition under Article 71(1) shall be:(A) either any number of Membersrepresenting not less than 5 percent. of the total voting rights of all the Membershaving at the date of the requisition a right to vote at the meeting to which the requisition relates; or(B) not less than ten Members.(3) Notice of any such intended resolution shall be given, and any such statement shall be circulated, to the Membersof the LLCentitled to have notice of the meeting sent to them by serving a copy of the resolution on each such Memberin any manner permitted for the service of notice of the meeting, and any notice of such resolution shall be given to any other Memberof the LLCby giving notice of the general effect of the resolution in any manner permitted for giving him notice of meetings of the LLC, 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) An
LLCshall 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 the LLC:(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 the LLC'sexpenses 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 the LLC, 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 the
Membersof an LLC, or any class thereof, may be effected, without a meeting and without any previous notice being required, by resolution in writing signed by all the Membersentitled 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 single Documentprovided each is on a Documentwhich 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 last Memberto 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 the Membersor at a meeting of the relevant class of Membersof the LLC.
Article 74 - Directors meetings and written resolutions(1) Save in the case of an
LLCwith a sole director, meetings of the directors shall be held as often as is necessary for the conduct of the affairs of the LLC.(2) Subject as provided in the articles of association of the LLC, each director shall be entitled to one vote and decisions shall be made by majority vote.(3) A meeting of the directors of an LLC, 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
LLCprovide otherwise, a meeting of directors or a committee of directors or of the Membersor 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) Every
LLCshall cause minutes of all proceedings at general meetings, meetings of the holders of a class of Shares, 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 the Members, or any class thereof, or of the directors, is effected by a resolution in writing or decision of a sole Memberor director in accordance with these Regulations, the LLCshall 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 of Sharesor a meeting of the directors shall be kept at the LLC'sregistered office, and shall during business hours be open to examination by a Memberwithout 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 the
CROon the Prescribed Form.(2) This Article applies to:(A) Special Resolutionsof an LLC;(B) a resolution of an LLCremoving a director from office;(C) resolutions of the Membersof an LLCor resolutions of a sole Memberto the extent that these would have been Special Resolutionsif passed at a general meeting;(D) a resolution approving the purchase of an LLC'sown Shares;(E) a Special Resolutionapproving a reduction of share capital of an LLC; and(F) a resolution removing an auditor of an LLCfrom office. Amended (as from 5th April 2015).
Article 78 - Recording of decisions by sole Member(1) If:(A) an
LLChas only one Member;(B) the Membertakes a decision which may be taken by the LLCin general meeting and has effect as if agreed by the LLCin general meeting; and(C) the decision is not taken by way of resolution in writingthe Membershall provide the LLCwith 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
LLCshall keep proper accounting Recordswith respect to all sums of money received and expended by the LLCand all sales and purchases of goods and services and other transactions by the LLCand the assets and Liabilitiesof the LLC. Such accounting Records, shall be sufficient to show and explain all transactions by the LLCand must be such as to:(1) disclose with reasonable accuracy the financial position of the LLCat any time; and(2) enable the directors to ensure that any accounts prepared by the LLCcomply with the requirements of these Regulations.
Article 80 - Location of Accounting Records(1) The
LLC'saccounting Recordsshall be:(A) kept at the LLC'sregistered office;(B) preserved by the LLCfor 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 the LLC.(2) If an LLCfails to comply with Article 79 and Article 80(1), the LLCand every Officeris in contravention of these Regulations. Amended (as from 5th April 2015).
Article 81 - Financial year of an LLC(1) The first financial year of an
LLCstarts 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 the LLC.(2) The second and any subsequent financial year shall start with the day immediately following the end of the LLC'sprevious financial year and end on the financial year end date in the next calendar year.(3) An LLCmay by notice in the Prescribed Formgiven to the CROspecify a new financial year end date having effect in relation to:(A) the LLC'scurrent financial year and subsequent financial years; or(B) the LLC'sprevious financial year and all financial years subsequent to that previous financial yearwhere, an LLC'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 the LLCwhich 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) An LLC'sfinancial 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 every
LLCshall cause accounts to be prepared in relation to each financial year of the LLCwhich shall be in the English language and shall comprise or include:(A) financial statements set out in accordance with IFRS, UK GAAP, US GAAPor such other accounting principles and standards as may be prescribed in rules made by the QFC Authority; and(B) such further information as may be required by these Regulations, any rules made by the QFC Authorityand the LLC'sarticles of association.(2) The accounts shall be prepared in accordance with accounting principles and standards prescribed in rules made by the QFC Authorityand comply with any other requirements of these Regulationsor any rules made by the QFC Authority. The accounts shall show a true and fair view of the profit or loss of the LLCfor the financial year in question and of the state of the LLC'saffairs at the end of such financial year.(3) The LLC'saccounts 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 the LLC'sauditors in accordance with these Regulationsand any rules made by the QFC Authority, such auditors' report to be written in the English language; and(C) laid before a meeting of the Memberstogether with a copy of the auditors' report.(5) The LLCshall file with the CROwithin 21 days after the meeting of the Membersbefore 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 an LLCthat is a Collective Investment Fund. Amended (as from 5th April 2015).
Article 83 - Provision of copy of accounts to Members(1) Any
Memberof an LLCis entitled, on demand and without charge, to be furnished with a copy of the LLC'slatest audited accounts and auditor's report.(2) An LLCshall comply with such a request within 7 days.(3) If an LLCfails to comply with Article 83(2), the LLCand every Officeris in contravention of these Regulations. Amended (as from 5th April 2015).
Article 84 - Publication of accounts
Any accounts published by an
LLCmust be audited and a copy of the auditors' report must accompany the published accounts.
Article 85 - Qualification of auditor(1) An
LLC'sauditor shall be an individual auditor or firm of auditors qualified to act as auditors in the QFCand approved by the QFC Authorityto act as auditors for LLCsand other Companiesand other Entitiesincorporated or registered in the QFCand entered in a register of approved auditors which shall be maintained by the CRO.(2) An auditor shall be regarded as qualified and approved by the QFC Authorityto act as an auditor in the QFCand shall be entitled to be entered in the register maintained by the CROif that auditor meets the criteria for approval set out in rules made by the QFC 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 the Regulatory Authoritypursuant to the Financial Services Regulations.
Article 86 - Appointment and removal of auditor(1) An
LLCshall appoint one or more auditors or a firm of auditors who shall examine and report on the LLC'saccounts in accordance with these Regulations. Except as provided for in Article 86(6) and Article 88(4) the LLCshall give notice in writing to the CROwithin 21 days of the first appointment and any subsequent change in auditor on the Prescribed Formtogether with the Prescribed Fee.(2) No person shall be appointed as auditor of an LLCwho is an Officeror employee of that LLCor of an Affiliated Companyor who is a partner, employer or employee of any such Officeror employee.(3) The directors of an LLCshall appoint the auditor of that LLCfor its first financial year. In subsequent financial years, an LLCshall 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 the Membersof the LLCin 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, the CROmay, on the application of any Member, 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 an LLCmay be removed by an Ordinary Resolution.(6) The LLCshall as soon as reasonably practicable and in any event not later than 5 days after the passing of the Ordinary Resolutionreferred to in Article 86(5) file a copy of the Ordinary Resolutionwith the CROin the Prescribed Formtogether with the Prescribed Feeand if an Authorised Firmwith the Regulatory Authority. Amended (as from 5th April 2015).
Article 87 - Remuneration of auditor(1) The remuneration of an auditor of an
LLCappointed by the Membersshall be fixed by the Membersin general meeting or by the directors, if they are authorised to do so by the Members, 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 the CROunder Article 86, the CROshall also fix the remuneration to be paid by the LLCfor its or their services.(3) There shall be stated in a note to an LLC'saudited accounts the amount of the remuneration of the LLC'sauditors in their capacity as such.
Article 88 - Resignation of an auditor(1) An auditor of an
LLCmay resign from office by depositing a notice in writing to that effect at the LLC'sregistered 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 the LLC'sregistered office:(A) a statement of any circumstances connected with his ceasing to hold office which he considers should be brought to the notice of the Membersor creditors of the LLC; 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), the LLCshall within 21 days send a copy of the statement to each director and Memberof the LLC.(4) The LLCshall 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 the CROin the Prescribed Formtogether with the Prescribed Feeand if an Authorised Firmwith the Regulatory Authority. Amended (as from 5th April 2015).
Article 89 - Auditor's report to LLC(1) An
LLC'sauditor shall make a report to the LLC's Memberson 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 these Regulations;(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 these Regulationsor rules made by the Regulatory Authorityunder the Financial Services Regulations.
Article 90 - Powers and duties of auditor(1) An
LLC'sauditor shall, in preparing a report in relation to the accounts of the LLC, carry out such investigations as will enable the auditor to form an opinion as to the following matters:(A) whether proper accounting Recordshave been kept by the Companyand proper returns adequate for the audit have been received from offices or branches of the LLCnot visited by the auditor;(B) whether the LLC'saccounts are in agreement with such accounting Recordsand returns; and(C) whether the LLC'saccounts have been prepared in compliance with applicable accounting principles and standards.(2) If the auditor is of the opinion that proper accounting Recordshave 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 accounting Recordsand 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 an LLC'saccounting and other books and Recordsand is entitled to require from an LLC's Officerssuch 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 of Membersand to be heard on any part of the business of the meeting which concerns the auditor.
Article 91 - Auditor's right to information
LLC, and any Member, Officer, employee or agent of the LLC, shall not knowingly or recklessly make to the LLC'sauditor 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 the LLCand is false, misleading or deceptive in a material particular.
Article 92 - Obstruction of auditor(1) An
LLC, or any Officerof an LLC, or any person acting under the direction or authority of such an LLCor Officer, shall not engage in conduct, including without limitation the:(A) destruction or concealment of Documents;(B) coercion, manipulation, misleading, or influencing of the auditor;(C) failure to provide access to information or Documentsspecified by the auditor; or(D) failure to give any information or explanation which the person is able to givewhere the LLC, Officeror 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 the LLCor the auditor's report materially misleading.