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Articles of Organization
"I need Articles of Organization for a corporation with a board of 3 directors, specifying quarterly meetings, a 65% majority for major decisions, and a fiscal year starting January 1st."
What is an Articles of Organization?
Articles of Organization form the official founding document for Limited Liability Companies (LLCs) in Saudi Arabia. This legal document establishes your company's existence and outlines its basic structure, including the company name, registered address, business activities, and capital contribution of each partner.
Under Saudi law, you must file your Articles of Organization with the Ministry of Commerce before starting operations. The document needs to specify management roles, profit-sharing arrangements, and how key decisions will be made. Once approved, it becomes your LLC's foundational contract and helps protect owners from personal liability for business debts.
When should you use an Articles of Organization?
You need Articles of Organization when starting a new LLC in Saudi Arabia - it's your company's birth certificate. Filing this document becomes essential before opening a bank account, signing contracts, or conducting any official business operations in the Kingdom. The Ministry of Commerce requires these articles during your initial business registration.
Many entrepreneurs prepare their Articles of Organization when seeking investment, as investors typically require this documentation to verify the company's legal status and ownership structure. It's also crucial when adding new partners, changing your business scope, or applying for government tenders and licenses.
What are the different types of Articles of Organization?
- Articles Of Association And Memorandum Of Association: Combined founding documents detailing both internal governance and external business relationships
- Company's Articles Of Association: Standard version focusing on internal rules and management structure
- Amended Articles Of Association: Updated version reflecting changes in ownership, capital, or operations
- Articles Of Incorporation And Certificate Of Incorporation: Comprehensive package including both formation documents and official registration proof
Who should typically use an Articles of Organization?
- Company Founders: Draft and sign the Articles of Organization during LLC formation, detailing their ownership stakes and roles
- Corporate Lawyers: Review and prepare the document to ensure compliance with Saudi regulations and protect stakeholder interests
- Ministry of Commerce Officials: Review, approve, and register the Articles as part of the business licensing process
- Company Partners: Must follow the governance structure and profit-sharing terms outlined in the Articles
- Business Managers: Operate within the authority limits and decision-making processes defined in the document
- External Stakeholders: Banks, investors, and contractors rely on the Articles to verify company legitimacy and authority
How do you write an Articles of Organization?
- Basic Company Details: Gather proposed company name, business activities, registered address, and duration of operations
- Partner Information: Collect passport copies, contact details, and proposed ownership percentages for all partners
- Capital Structure: Define initial capital amount and how it will be distributed among partners
- Management Structure: Decide on manager appointments, signing authorities, and decision-making processes
- Document Platform: Use our system to generate legally-compliant Articles that meet Ministry of Commerce requirements
- Required Attachments: Prepare partner identification documents and proof of capital deposit
- Final Review: Check all details match your business registration application before submission
What should be included in an Articles of Organization?
- Company Identity: Legal name, type of company (LLC), registered address, and duration of operations
- Business Purpose: Detailed description of permitted business activities aligned with Saudi licensing requirements
- Capital Structure: Total capital amount, partner contributions, and share distribution percentages
- Management Framework: Names of managers, scope of authority, and decision-making procedures
- Partner Rights: Voting rights, profit distribution, and transfer of ownership rules
- Dispute Resolution: Clear procedures for handling disagreements under Saudi commercial law
- Exit Provisions: Procedures for company dissolution or partner withdrawal
- Authentication Details: Notarization requirements and official signature blocks
What's the difference between an Articles of Organization and an Articles of Incorporation?
Articles of Organization differ significantly from Articles of Incorporation in Saudi Arabia's legal framework. While both are founding documents, they serve different business structures and requirements.
- Legal Entity Type: Articles of Organization are specifically for LLCs (Limited Liability Companies), while Articles of Incorporation are used for Joint Stock Companies
- Capital Requirements: LLCs using Articles of Organization have more flexible capital requirements, whereas incorporated companies need higher minimum capital
- Management Structure: Articles of Organization allow for simpler management structures with partners as managers, while Articles of Incorporation require formal boards and shareholders
- Regulatory Oversight: Incorporated companies face stricter reporting requirements and Capital Market Authority oversight compared to LLCs
- Ownership Transfer: LLC shares have more restricted transferability under Articles of Organization, while incorporated company shares can be freely traded
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