Al-Hadhiri: The Legal Effect of Attempting to Classify the National Oil Corporation as “Sovereign” Is Null and Contrary to Existing Laws

Oil law expert Othman Al-Hadhiri wrote an article in which he stated:

What is the legal effect of considering the National Oil Corporation a sovereign institution under the supervision of the House of Representatives and the High Council of State?

While following Libyan media, I learned that voices within the High Council of State—and perhaps the House of Representatives—intend to subject the NOC to direct oversight and affiliation with both councils, classifying it as a “sovereign institution,” and transferring the authority to appoint its chairman and board members to the two councils. This has major legal implications, severe consequences, and raises multiple constitutional and legal issues, particularly in light of existing laws such as:

• Oil Law No. (25) of 1955 and its amendments.
• Law establishing the National Oil Corporation No. (24) of 1970.
• Law reorganizing the NOC No. (10) of 1979.

First: The Legal Nature of the NOC
According to its founding law, the NOC is a public institution with independent legal personality and financial autonomy. It falls under the executive authority, represented by the government (usually the Ministry of Oil and the Council of Ministers).
It is not a sovereign body in the sense of sovereign institutions such as the Central Bank, Audit Bureau, or the Administrative Control and Anti-Corruption Authorities.
It exercises technical and commercial functions related to managing oil resources, without interfering in general policy or sovereignty in the constitutional sense.

Second: The Legal Effect of the Councils Attempting to Impose Oversight or Share in Appointments

• Violation of the separation of powers: Appointment of heads of executive institutions is the exclusive jurisdiction of the executive branch. Legislative interference breaches this principle.
• Overstepping council mandates: There is no provision in Libyan law or interim constitutions granting the House of Representatives or the High Council of State authority to appoint or endorse the NOC board of directors.
• Contradiction with governing laws: The laws establishing and regulating the NOC grant this power to the Council of Ministers or the relevant minister, not to legislative bodies.
• Weakening independence and creating international risks: Foreign parties may seize NOC assets abroad by arguing it is “an integral part of the state structure,” undermining the NOC’s successful claims of independence in international lawsuits.
• Politicization: Legislative interference may politicize an institution that must remain technical and professional, harming transparency in managing the oil sector.
• Threat to contract legitimacy: Any appointments made unlawfully could be contested domestically and internationally, putting the NOC’s legitimacy in doubt before global partners.

Does this comply with the law?
I state unequivocally: it does not comply with existing laws.

• Oil Law No. (25) of 1955 and its amendments give no role to legislative councils in NOC appointments.
• Law No. (24) of 1970 places the NOC under the executive authority.

We must adhere to the laws governing the oil industry during this transitional stage and leave such matters until after parliamentary elections result in a stable government capable of managing state affairs independently.

Any impulsive measures taken without deep consideration will negatively impact the Libyan economy as a whole.

Conclusion:
The legal effect of attempting to classify the NOC as a sovereign institution and granting appointment powers to the two councils is legally null and contrary to existing laws.

Such attempts lead to legal and institutional confusion, weaken the NOC’s legitimacy domestically and internationally, and undermine the state’s global standing.