Spotlight on Limited and Joint Stock Companies
The proper application of Lebanese Commercial Law is not just a legal formality—it’s an essential safeguard for the healthy management of companies, especially Limited Liability Companies (SARLs) and Joint Stock Companies (SALs).
Let’s start with a well-established principle: Limited Liability Companies are typically managed by a single Manager—who also serves as the authorized signatory. This manager may be appointed either through the company’s Articles of Association or by resolution of the Ordinary General Assembly. Their powers are defined by the law and governing documents.
When it comes to Joint Stock Companies, however, the structure and requirements become more rigorous. According to Article 148 of the Lebanese Commercial Code, individuals declared bankrupt may not be appointed to the Board of Directors unless they have been rehabilitated for at least 10 years. This is why courts and oversight authorities insist on obtaining a criminal record extract for board members, assistant general managers, and chairpersons—ensuring their eligibility and trustworthiness.
Furthermore, Article 149 of the same code defines the term limits for Board appointments: either five years if stipulated in the Articles of Association, or three years if set by a General Assembly resolution.
Where the Law Gets Murky: Limited Companies & Assistant Managers
In Limited Companies, management typically rests with a single manager—although multiple managers may be appointed, as permitted under Article 16 of Legislative Decree No. 35/67, as amended by Laws 120/1992 and 126/2019. But here’s the key detail: the law does not provide for the role of an “Assistant Manager.”
Despite this, through our daily legal work and review of countless company records, we’ve seen a recurring trend: some SARLs are appointing assistant managers—a role not mentioned anywhere in the legal texts.
This raises important legal questions:
- Is it lawful to appoint an assistant manager in a Limited Company, even if the law doesn’t explicitly allow it?
- Could this be considered a legal violation, or is it a valid practice simply filling a gap left by the legislation?
- Can companies require managers in SARLs to present a criminal record, despite the absence of any clear requirement in the law?
Our Perspective
These ambiguities reflect the broader challenge many companies face: navigating the gray zones of company law. In our view, the absence of explicit legal prohibition does not always equate to legality—especially when rights, responsibilities, or liabilities may be affected.
At Issa Mansour Law Office, we emphasize the importance of aligning company practices with legal texts—not only to remain compliant, but to protect stakeholders and ensure long-term organizational integrity.
We remain available to advise on these complex issues, assist in the structuring of corporate governance, and review the legality of internal decisions to avoid future legal exposure.