JEDDAH — In a major boost for the small and medium enterprises sector, the Council of Ministers on Monday approved the new law of companies under which two partners can establish a joint stock company instead of a minimum five partners. The weekly session of the Cabinet, chaired by Custodian of the Two Holy Mosques King Salman at Al-Yamama Palace here, took the landmark decision after examining a report from the Ministry of Commerce and Industry and a decision by the Shoura Council, the Saudi Press Agency reported. According to the new company law, the minimum capital for setting up a joint stock company is SR500,000 instead of SR2 million. In a statement to SPA following the session, Minister of Culture and Information Adel Al-Turaifi said the new law is based on the concept of a single person company so as to encourage traders to start their commercial activities by starting a company instead of an establishment. To combat crimes and violations related with companies, the new law stipulates imprisonment up to five years and SR5 million in fines. At the outset of the session, King Salman welcomed leaders and heads of state to the Kingdom to attend the 4th Summit of Arab and South American states, which will be held in Riyadh on Tuesday and Wednesday. The Cabinet also approved procedures aimed at making major changes in the organizational structure and functions of Grain Silos & Flour Mills Organization (GSFMO). According to the procedures, the name of the organization will be changed to General Organization for Grains, and it will function with independent powers. The Cabinet endorsed the procedures for the establishment of four joint stock companies for flour mills under the supervision of the Public Investment Fund in coordination with GSFMO. Al-Turaifi said the Cabinet approved that the Ministry of Education will meet the transportation cost for the guardians of Saudi students with special needs for the purpose of visiting their children abroad. This facility will be available for the parents of those students who have spent at least one academic year abroad. The ministry has to provide a return travel ticket to the parent of a scholarship student, and two return tickets in case the student is doing his course at a rehabilitation center. Another major decision of the Cabinet is the approval of the organizational procedures for the Center for Achievement and Fast Intervention, which was created in line with a royal order last month. The Center follows up on the accomplishment of initiatives having economic and developmental priority and significance, taken by the Council of Economic and Development Affairs.
