BAHRAIN Law and Practice Contributed by: Noor Radhi, Fatima Alali and Saifuddin Mahmood, Hassan Radhi & Associates
of the incorporation approval by the Ministry of Industry and Commerce (in case of closed joint stock company). The invitation to convene the constituent assem - bly of shareholders shall be published in at least two daily local newspapers – one of them at least to be in Arabic and the other in English. The minimum notice period is 21 days and the notice shall include the agenda of the meeting. Copies of the invitation documents shall be forwarded to the Ministry at least ten days before the meeting. 5.4 Shareholder Claims The bases of claim that exist for shareholders against the company are as follows: • a shareholder may lodge a claim seeking to nullify a decision by the general meeting if such decision is not issued in accordance with the law and the Constitutional Docu - ments of the company; • pursuant to Article 168 bis of the CCL, a shareholder may lodge a claim against the company if its business is being conducted in a manner that unfairly causes damage to the shareholders or a group of shareholders, or if the company intends to take an action that causes damage to the shareholders or a group of shareholders; and • pursuant to Article 18 bis of the CCL, a share - holder may lodge a claim against any officer, director or even another shareholder, on the basis of the following: (a) providing incorrect information about the company’s capital in any document likely to affect the company’s financial standing; (b) using the company for fraudulent or il - legal purposes; (c) using the company’s assets as if they are their own; (d) conflict of interest;
(e) making decisions or taking actions that encumber the company with obligations knowing that the company cannot fulfil, or if the company is unable to fulfil its ob - ligations as a result of an officer, director or shareholder’s gross negligence or error; (f) if their decisions and actions cause the company to be unable to pay taxes or official fees; (g) violation of the provisions of the law or company’s constitutional documents; (h) the limitation of powers is not observed or duties are performed in a fraudulent or gross negligent manner; and (i) failure to act as a prudent, reasonable person in a given circumstance. 5.5 Disclosure by Shareholders in Publicly Traded Companies Any person whose ownership, in a publicly trad - ed company, alone or their ownership together with that of their minor children, or any other accounts under their disposal, or the ownership of any of their associate or affiliate companies, amounts to 5% or more of any listed security of a joint stock company, must notify the licensed exchange (Bahrain Bourse) forthwith, which shall in turn notify the CBB of this fact and the CBB may declare the name of the person who owns such stake. All persons must obtain a CBB prior written approval to execute any order that will bring their ownership alone or their ownership together with their minor children, or the accounts standing under their disposal, to 10% or more in any listed security. Any further increase of 1% or more shall also be subject to CBB prior written approval. Companies are further required to disclose ulti - mate beneficial owner information to the Ministry of Industry and Commerce.
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