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Legal Corner: The importance of commercial registration
The private sector plays an important and prominent role in advancing the economic development in the Qatari society, and there are no statistics on the number of private companies, their percentage in the state, full assessment of their role and the areas of work that attract this important sector. It is certain that state-owned companies can be identified and their knowledge can be facilitated through more than one source.
There is no doubt that the data for each company, which distinguishes it from other is very important to distinguish between the companies as the companies are like the persons so they are legal bodies that enjoy a distinctive trade name. The name is approved after making sure that there is no other company with the same name. Every company has a commercial registration that contains its basic information, number of the commercial register, commercial name, date of establishment of the company, expiry date of the register, type of company, number of its branches, if any, nationality, trade mark, address of company’s headquarters, PO Box, phone number and capital of the company. The commercial register also includes the names of the partners, their nationalities and the proportion of their share in the company’s capital as well as the appointment of authorised signatories, their attributes, functional names and nationalities in addition to the reference to the commercial activities practiced by the company and finally the names of branches of the company, if any.
The commercial register and the data contained therein is a declaration from the Ministry of Business and Commerce and is a testimony that the data contained therein is correct. The company can protest any amendment or change in the data referred to in the commercial register only after pointing it in the commercial register of the company.
In order to confirm the credibility of the companies and realise the principle of transparency, and to eliminate any confusion or ambiguity, the Companies Act No. 5 of 2002 provided that the company must put its trade name and disclose the type, headquarter, registration number in the commercial register, amount of capital in all contracts, mails, quittances, declarations and other papers that can be issued by the company, and this applies to the Qatari and foreign companies.
There is no doubt that the disclosure of the data required by the law is not a matter of choice but an obligation under the law and whoever violates it shall be punished under the provisions and articles of the Commercial Companies Law No. 5/2002, as the law with respect to limited liability companies point out that it must take its name out of its activity or the name of the one or more of the partners with a mandatory addition of the words “limited liability company” to the name of the company. If the directors neglect to take this point into account they shall be responsible for the money and are jointly liable for the obligations of the company as well as the compensation.
It is clear from this provision and other provisions of the law that the responsibility for disclosure of this data and, its writing on the mails and quittances of the company, its declarations and papers that are issued by it lies with the director of the company, as the law points out that the director of the company has the full power to manage the company, unless the contract of the company limits his power. The actions of the director are binding for the company, provided that it shall be accompanied by a statement of capacity he deals with. Every decision to change the directors or to restrict their powers, shall apply to others only after its notation in the commercial register.
The law concerning the responsibility of managers of the majority of types of companies added that they are responsible, like the members of the boards of joint stock companies, as every act or transaction or a decision issued in violation of the provisions of the Companies Law No. 5/2002 shall be void, without the prejudice to the rights of others in good faith. In case of plurality to refer the cause of invalidity, they shall jointly be responsible for compensation among themselves, and every chairman of the board of directors or a board member or manager of company violates the provisions of the Companies Law No. 5/2002, shall be punished by imprisonment for a term not exceeding two years and a fine of not less than ten thousand riyals and not more than one hundred thousand riyals or either of the penalties.
It goes without saying that the commitment of the directors of the companies has positive effects including high level of confidence in the reputed and committed company, expansion of work scope and the confidence of customers in the company because it works in the light. The commitment eliminates the virtual companies which spread recently, easily facilitates the settlement of outstanding debt and leads to the quick decision in the cases handled between companies in the courts where the time is wasted in formalities related to the address of the virtual companies. It is no longer easy to obtain a commercial registration number because of many reviewers, large number of registered companies, non-acceptance of manual inquiries, and dependence on the electronic portal to get the commercial register under the intended registration number. In the absence of a registration number it is difficult for any company to get the commercial register, but of course, it is not impossible. There is no doubt that these things are very important and it is required to comply with them for the benefit of all.
We hope that the Department of Commercial Registration will play a positive and effective role in ensuring that the companies abide to putting their data on their mails, receipts and all the papers that are issued by them at the time of annual renewal of the commercial registration or issuing annual or half yearly magazine disclosing in it the names of companies registered in the Department of Commercial Registration and the core information mentioned in the register for the reference if needed in order to achieve transparency and confidence in the registered companies.







