Reform of the Laws on Moroccan “sociétés anonymes” (“SA”) and “sociétés à responsabilité limitée” (“SARL”)

October 10th, 2019

Morocco’s policy to strengthen the country’s economic attractiveness was recently illustrated by the adoption of Laws n° 20-19 of April, 26, 2019 and n° 21-9 of April, 29, 2019, respectively amending the former regimes applicable to Moroccan SA (Law n°17-95) and SARL and other company forms (Law n° 5-96).

1 – Legal regime of the SA

The disposal by the company of its real estate properties and fixed assets is now subject to prior authorization of the Extraordinary General Meeting, where such disposal concerns more than 50% of the company’s assets during a twelve month period.

The reform replaces the former notion of “non-officer” Director with the notion of “non-executive” Director (or member of the Supervisory Board). Both the Board of Directors and the Supervisory Board must be mainly composed of non-executive members. Furthermore, the financial audit committee which must be established in publicly traded companies shall exclusively be composed of non-executive members.

Publicly traded SA companies shall, from April, 2020, nominate at least one independent Director. Other forms of companies will be free to nominate such Directors . The Law provides that the number of independent Directors cannot exceed one third of the total number of Directors. The notion of “independent Director” is defined by Section 41 bis of Law n° 17-95.

The management report communicated to the General Meeting of shareholders by the Board of Directors or the Executive Board (Directoire) shall henceforth include a list of every Director or Board member’s positions and functions within third-party companies.

The reform introduces a new source of liability for Directors, members of the Supervisory Board and of the Executive Board, CEOs and Deputy-CEOs: they can now be held liable for acts they perform pursuant to a corporate mandate but which are not in line with the company’s interests. This hypothesis differs from the notion of fault and refers to mistakes committed by the aforementioned persons.

2 – Legal regime of the SARL

Shareholders holding one-tenth of the share capital – subject to representing at least 10% of all shareholders – are free to request a General Meeting. Shareholders who represent at least 5% of the share capital can request the inscription of one or several draft resolutions to the General Meeting’s agenda.

The new Law provides that the General Meeting, or failing that, the Managing Director, fixes the terms of payment regarding the distribution of dividends, as voted by the General Meeting. This payment shall now occur within a maximum delay of nine months after the end of the financial year.

As with SAs, the disposal of more than 50% of company assets during a period of twelve months is subject to authorization from shareholders who represent at least three quarters of the share capital, on the basis of a report drawn-up by the manager10.

1 Law n° 17-95, sec. 70 § 2 (new) for the SA with Board of Directors; sec. 104 § 5 (new) for the SA with Supervisory Board; sec. 110 for the power of Extraordinary General Meeting.
2 Law n° 17-95, sec. 67 §6 (new).
3 Law n° 17-95, sec. 41 bis and 83 (new).
4 Law n° 17-95, sec. 41 ter (new).
5 Law n° 17-95, sec. 142 § 2 (new).
6 Law n° 17-95, sec. 352 (new).
7 Law n° 5-96, sec.71 §. 4 (new).
8 Law n° 5-96, sec.71 §. 5 (new).
9 Law n° 5-96, sec.83 bis (new).
10 Law n° 5-96, sec. 75 (new).