Firms Transferred into Closed Joint Stock Companies, increased by 260% – Ministry of Commerce Reporte

The total number of firms transferred into closed joint stock companies increased by 260%, as the Year 2021 has experienced the transfer of as many as 191 limited liability companies into a closed joint stock company, while the Year 2020 has recorded only 53 firms transfer into closed joint stock companies, the Ministry of Commerce announced.

Increase in the transfer of firms of all forms into closed joint stock companies since 2015 until now has skyrocketed, as the total closed joint stock companies jumped, during the past 6 years from 1,180 in 2015 to 2,102, at the end of 2021, registering a growth of 78 percent,

ministry’s statistics showed.

Activities of the transferred firms into closed joint stock varied among several sectors, most notably the manufacturing, petrochemical, mining, investment, communications, tourism and entertainment sectors, technical services and finance.

It also included the sectors of general trade, financial services, real estate, human resources, general contracting, education, transportation, logistics, food and construction industries, professional services, the activity of holding companies, the health sector, the agricultural and water sectors, and the advertising sector.

The ministry clarified the most prominent advantages of the transfer from limited liability to closed joint stock companies, including the multiplicity and diversity of funding sources, the possibility of listing in the financial market, and the expansion of the shareholders’ stake base.

Among the advantages of transfer is also strengthening control, governance, disclosure and transparency, in transactions, giving more flexibility for decision-making, and enhancing customer confidence, in addition to the advantages of shifting to institutional work, in a way that ensures the sustainability of the company and its durability through generations.

The Ministry of Commerce allows companies to conduct the transfer process into closed joint stock company, electronically – from the online – with easy and smooth steps, through the ministry’s website at the link: e.mc.gov.sa