• news-banner

    Expert Insights

Amendments to the Bahrain Commercial Companies Law

Decree 28 of 2020, issued on 28 September 2020, has set out various amendments to certain provisions of the Bahrain Commercial Companies Law (Law 21 of 2001) (the “BCCL”). The amendments are part of Bahrain’s ongoing aim to develop its compliance and regulatory frameworks in line with international best practice.

The implementing regulations have not yet been issued but will clarify how the amendments will be implemented and affect the day-to-day operations of the entities affected.

Single Person Company (S.P.C.):

  • S.P.Cs will be merged with W.L.Ls meaning that S.P.Cs will be required to convert to a W.L.L. within six months of the announcement date.

With Limited Liability Company:

  • W.L.Ls will be permitted to have one or more shareholders, facilitating the conversion of S.P.Cs to W.L.Ls. There will no longer be a maximum number of shareholders.
  • The minimum share capital requirement for W.L.Ls has been removed, although certain activities undertaken by a W.L.L. may dictate a required specific minimum share capital.

Joint Stock Companies:

  • Joint stock companies will now be allowed to increase their capital in the following ways:
    • Converting debt to equity;
    • Converting its reserve or distributable profits;
    • Converting bonds into shares;
    • Issuing convertible bonds; and
    • Accepting in-kind contributions.

Limited Partnerships:

  • Limited Partnerships are now permitted to adopt a trade name. 

Not-for-profit companies:

  • A new chapter has been added to the BCCL dealing with such companies, which may be set up as W.L.Ls.

Board of directors:

  • Nominees to be appointed to a board must disclose certain shareholders prior to their appointment, such as their CVs, other board appointments held and involvement with competing entities, amongst others.
  • Members of an audit committee must also be board members.
  • The powers of a chairperson can only be delegated to a board member or to executive management of the entity.

Remuneration:

  • A board report presented at an entity’s AGM must include details of the remuneration, shareholdings and benefits of its board members.  

Strategic shareholders:

  • An entity can, subject to certain possible regulatory consents and conditions, issue shares to strategic shareholders to increase capital. Please note that the requirements and/or conditions are not yet known.

Statutory reserve:

  • Subject to relevant rules of the Central Bank of Bahrain, the statutory reserve of an entity may be utilized to increase its capital in order to cover any losses.

Preference Shares:

  • An entity may now issue preference shares.

Employee share options & pre-emption rights:

  • The terms and conditions of employee share incentive schemes are to be fully disclosed to employees.
    Pre-emption rights in respect of shares issued under such employee share incentive schemes or issued to a strategic shareholder have been waived.

Our thinking

  • Women in Leadership: Planning for the future

    Sarah Wigington

    Events

  • Charles Russell Speechlys Partner Promotions 2024

    Bart Peerless

    News

  • Thomas Snider, Reem Faqihi and Dalal Alhouti discuss the impact of technology on the arbitration landscape for Legal Community MENA

    Thomas R. Snider

    In the Press

  • Charles Russell Speechlys advises Countryside Partnerships on its joint venture with Abri to develop 1,500 homes in West Sussex

    Sarah Wigington

    News

  • Charles Russell Speechlys boosts international private wealth offering with the arrival of Amira Shaker-Bortman

    Amira Shaker-Bortman

    News

  • Breaking Barriers: The Tech Revolution in Arbitration

    Thomas R. Snider

    Insights

  • Mark Howard writes for the Evening Standard on the blocked Telegraph takeover, the NSI Act and the Enterprise Act 2002

    Mark Howard

    In the Press

  • Retail Week quotes Ilona Bateson on the CMA’s investigation into environmental claims in the fashion retail sector

    Ilona Bateson

    In the Press

  • Fashion and the Green Claims Code brought into focus by open letter from the CMA.

    Ilona Bateson

    Quick Reads

  • Charles Russell Speechlys grows its rankings in The Legal 500 EMEA directory

    Frédéric Jeannin

    News

  • Family Offices for Middle Eastern Clients

    Elinor Boote

    Insights

  • The Lawyer covers the recent growth and strategy of our corporate practice

    David Collins

    In the Press

  • The role of national courts in arbitration

    Thomas R. Snider

    Insights

  • Charles Russell Speechlys advises on three secondary fundraises across three different markets

    Paul Arathoon

    News

  • Embracing AI's potential in arbitration

    Thomas R. Snider

    Insights

  • Thomas Snider, Patrick Gearon and Dalal Alhouti discuss the impact of AI on international arbitration for Legal Community MENA

    Thomas R. Snider

    In the Press

  • Landmark European AI Act Passed By The European Parliament

    Louise Zafer

    Insights

  • Drafting the “perfect” arbitration agreement

    Alim Khamis FCIArb

    Insights

  • Peter Smith shares his thoughts on digital asset disputes for Legal Community MENA

    Peter Smith

    In the Press

  • Charles Russell Speechlys advises Vitro on a major international restructuring project

    David Cordova Flores

    News

  • Unlocking Digital Asset Disputes: Strategies for Success

    Peter Smith

    Insights

  • Will new powers at Companies House stop or slow down fraudsters?

    Peter Carlyon

    Quick Reads

  • Charles Russell Speechlys hosts international arbitration event in Dubai

    Peter Smith

    Quick Reads

  • The ongoing fight against fakes

    Charlotte Duly

    Quick Reads

  • Abu Dhabi’s New Arbitral Centre Unveils its Rules

    Dalal Alhouti

    Quick Reads

  • New Regulations for the UAE’s Media Sector in 2024

    Mark Hill

    Quick Reads

  • Under the Influence: Legal Considerations for Social Media Influencer Partnerships in the UAE

    Mark Hill

    Quick Reads

  • EU AI Act – Will it become a law for all the world?

    Nick White

    Quick Reads

  • Ctrl + GCC: The Rise of e-Sports in the Gulf

    Mark Hill

    Quick Reads

  • Digital Markets, Competition and Consumers Bill: Will new consumer protection rules restrict access to Gift Aid?

    Verity Heath

    Quick Reads

  • Les entreprises en difficulté ou en croissance peuvent-elle se passer des equity lines? Can distressed or growth companies do without hybrid bonds?

    Dimitri-André Sonier

    Quick Reads

  • The End of the SAG-AFTRA Strike & What it Means for the Middle East

    Mark Hill

    Quick Reads

  • UAE Strengthens its Position as Leading Destination for A.I.

    Mark Hill

    Quick Reads

  • Dubai Court of Cassation Extends Arbitration Agreement Across Subsequent Contracts

    Peter Smith

    Quick Reads

  • Venture capital funds agree 'investment compact' to increase investment in UK high-growth companies

    Mike Barrington

    Quick Reads

  • UAE Polishes Federal Arbitration Law

    Peter Smith

    Quick Reads

  • Is the opening up of Nexity's services division capital a consequence of the difficulties facing the French property sector?

    Dimitri-André Sonier

    Quick Reads

  • Drone deliveries: Be Prepared

    Emma Humphreys

    Quick Reads

  • New Governance Guidelines for family-owned businesses in the UAE

    William Reichert

    Quick Reads

  • Treasury Committee endorses mandatory venture capital diversity policies from 2025

    Lia Renna

    Quick Reads

Back to top