Ministerial Order No. (1) 2002
Concerning Commuting Old Age Pension
And the Amount to be Returned in the Case of Surrendering the Commutation

The Minister of Labour and Social Affairs,

Having reviewed the Social Insurance Law No. 24/1976 and its amendments, in particular Articles 144, 145, 146 and 147,

And the Order of the Minister of Health No. (16) 1986 concerning Medical Examination on Commutation's Applicant,

And the Proposal of the Board of Directors of the General Organization for Social Insurance at its meeting No. (6) held on 15 October 2001,

And upon the submission of the Director General of the General Organization for Social Insurance,

Hereby Orders:

Article 1

The General Organisation for Social Insurance may, upon the request of old age pensioners, commute part of their pension into a lump sum determined in accordance with the schedule (6) annexed to the Social Insurance Law, and under the conditions and manners specified in this order.

Article 2

Subject to the provisions of this order, the pension is commuted up to 25% of its value excluding the allowances mentioned in the Prime Ministerial Edict No. (12/1979). The pensioner may not be allowed to commute for the second time before the expiry of two years from the date of the last installment paid in respect of the previous commutation. Furthermore the dinar's fractions may not be commuted.

Article3

Employment accident and disability pensions may not be commuted, also the dependants have no right to commute their pensions.

Article 4

The applicants should sign and submit the Form No. (1) annexed to this order, upon which the General Organisation for Social Insurance shall record those applications into a special register which should contains the following details:

1- Date of receiving the request.
2- Registration number and its date.
3- Applicant's name.
4- Applicant's social insurance number.
5- Applicant's personal number.
6- Applicant's pension number.
7- Acquired pension.
8- The fraction wanted to be commuted.
9- The installments period.
10- Number of the previous commutation.
11- Applicant's address.

Article 5

The General Organization for Social Insurance shall send the applicant along with the Form No. (2) attached herewith, to the Medical Committee for the medical examination and to assess his medical condition in accordance with the Order of the Minister of Health No. 16/1986 concerning medical examination on commutation applicants; the Committee shall return the form to the General Organisation for Social Insurance containing the result of the examination, and the applicant bears all costs towards the Medical Committee.

Article 6

The process of commutation will be continued only if the medical examination certifies that the medical condition of the applicant is good or satisfied, and in the latter case the committee shall add a number of years to the applicant's age. The adjusted age will be the basis of considering the capital of commuted pension in accordance with schedule No. (6) annexed to the Social Insurance Law.

The result of the medical examination will remain valid for one year starting from the date of the committee decision.

If the medical examination reports that the applicant's condition is not satisfied, the commutation process will not be continued; the second examination will not be allowed before the expiry of one year from the date of the first medical examination.

Article 7

The commutation will not be allowed if it appears that the pension is subject to deductions equal to 25% for a debt due to the General Organisation for Social Insurance or for others; if the level of deduction falls below 25% then the commutation may be made within the difference between 25% and the level of such deduction.

Article 8

In the case of rejecting any application due to reasons mentioned articles (6) and (7) above, the General Organisation for Social Insurance shall notify the applicant of the reasons behind this decision on the Form No. (3) attached to this Order.

Article 9

The commuted capital is determined in accordance with the schedule (6) attached to the Social Insurance Law, and on the basis of the applicant's age at the time of carrying the medical examination, taking into account the number of years added by the Medical Committee previously mentioned in the first paragraph of article (6) of this Order.

Article 10

The applicant is to be notified, by a registered letter, of the acquired capital that he is entitled to, and shall declare on the Form No. (4) before the authorized clerk the acceptance of the offer. If the applicant failed to come forward within two months from the date of being notified or reject to sign the Form No. (4), it will be regarded as waiving the claim and all the process shall be ceased; however the Director General may disregard the two months period if the applicant justified such a delay.

Article 11

The commuted capital will be paid by cheque; or it will be credited into the applicant's appointed account.

Article 12

The General Organisation for Social Insurance shall deduct the monthly installments from the pension until all installments are fully paid, the deduction shall start from the following month of the month during which the commuted capital payment was made.

If the deduction is not possible due to suspending the whole pension or part of it for any reason, the commuter is obliged to pay the remaining installments on due date.

Article 13

The commuter may at any time surrender the commutation using the Form No. (5) attached to this order; in return the commuter shall repay the current value of all the remaining installments in accordance with the schedule attached to this order, in such a case the installment deduction shall be ceased once all the installments are fully paid.

Article 14

In the case of commuter's death, all remaining installments shall be dropped off; payment due to the dependants shall be settled as if the pensioner had not commuted any part of the pension.

Article 15

The Director General of the General Organisation for Social Insurance shall implement this order.

Article 16

This order shall be published in the Official Gazette and shall come into effect from 1st March 2002.

Abdulnabi Abdulla Al-Sho'ala
Minister for Labour and Social Affair
Chairman of the Board of Directors of the
General Organisation for Social Insurance

Issued on:
30 January 2002