KSP LEGAL ARTICLES
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KSP LEGAL ARTICLES
Is Board of Commissioners authorized to sign transactional documents on behalf of a company?
Law Number 40 of 2007 regarding Limited Liability Company (“Company Law”) provides definition of the Board of Commissioners (BOC) which is the Company organ in charge of conducting supervision in general and/or in particular in accordance with the Company’s articles of association and providing advice to the Board of Directors (BOD).
Article 108 of the Company Law further stipulates that the BOC performs supervisory duties on management policy, the general performance of management, regarding both the Company and the Company's business, and provides advice to the BOD. However, these roles and duties may be specified in the Company’s Articles of Association that are approved by the Company’s shareholders and not contradictory with the said stipulation. For instance, the BOC is entitled to check all books, agreements and company’s documents as well as to check financial conditions at any time.
Implementation of these roles and duties cannot be hindered by the BOD because the BOC and the BOD are basically company organs that have the same position with different functions. Both members of the BOD and the BOC are appointed and terminated by and has direct responsibility to the Company's shareholders. Unlike the BOD, which allows each member of the BOD to act independently in carrying out its roles and duties, each member of the BOC cannot act individually in carrying out its roles and duties, except based on a decision of the BOC.
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Article 108 of the Company Law further stipulates that the BOC performs supervisory duties on management policy, the general performance of management, regarding both the Company and the Company's business, and provides advice to the BOD. However, these roles and duties may be specified in the Company’s Articles of Association that are approved by the Company’s shareholders and not contradictory with the said stipulation. For instance, the BOC is entitled to check all books, agreements and company’s documents as well as to check financial conditions at any time.
Implementation of these roles and duties cannot be hindered by the BOD because the BOC and the BOD are basically company organs that have the same position with different functions. Both members of the BOD and the BOC are appointed and terminated by and has direct responsibility to the Company's shareholders. Unlike the BOD, which allows each member of the BOD to act independently in carrying out its roles and duties, each member of the BOC cannot act individually in carrying out its roles and duties, except based on a decision of the BOC.
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