Tuesday, October 6, 2009

Authorised Managers and Signatories

The Commercial Registration Certificate of an Omani company (such as a limited liability company and a joint stock company) is available from the Ministry of Commerce and Industry for a small fee. It sets out certain information on the company including the names of the authorised managers and signatories of the company.

The Commercial Registration Certificate specifies the type of authorisation for the authorised managers and signatories - the options are full, financial, technical and/or administrative. The authorisation can be for one person to act individually or jointly with another person. It can also include an authorisation limit for financial matters which can be a set monetary amount or unlimited.

Under Article 153 (Binding effects of manager’s acts) of the Commercial Companies Law, a limited liability company shall be bound by all acts performed by its managers acting in the company’s name and within the scope of their authority. Any bona fide third party shall be entitled to assume that any act done by the managers of the company in the course of its business comes within the scope of the manager’s authority, and the company shall be bound thereby unless the limitation of the manager’s authority is registered in the Commercial Registration Certificate. Article 104 (Binding effect of acts of the company) of the Commercial Companies Law sets out a similar requirement for joint stock companies for the board of directors, chairman, and managing directors of the company.

Therefore when doing business with an Omani company, the most prudent course of action is to ensure that all documents signed by that company are signed by an authorised signatory or signatories with the relevant authority as set out in the Commercial Registration Certificate. This will avoid the situation where the authority of the signatory or signatories signing on behalf of the company may be challenged at a later date.