Kuwait Court of Cassation principle number 424

A member of a company's board of directors. Must own a number of its shares, to be deposited with an approved bank within one month from the date of appointment, and not transferable until the membership ends. Failure to provide this security. Invalidates the membership. The reason for this: ensuring the member's proper management of the business entrusted to the member and preventing misuse of the company's funds. - Transfer of shares to a third party. Its effect. The shareholder loses the status of partner. - Shares of joint-stock companies. Transferable by commercial methods without following the procedures for assignment of rights. The consequence of this. A shareholder may transfer shares to a third party who succeeds to the rights and obligations, and this disposition may not be invoked against the company until the date it is entered in the shareholders' register maintained by the company. - 86 - Commercial - Banking operations:- - In general:-