Third Party Payment Contract for United Arab Emirates

Third Party Payment Contract Template for United Arab Emirates

A comprehensive legal agreement governed by UAE law that establishes and regulates payment obligations to be fulfilled by a third party on behalf of a primary debtor to a designated beneficiary. This contract type is structured in accordance with UAE Federal Law No. 5 of 1985 (Civil Code) and relevant banking regulations, incorporating specific provisions for payment mechanisms, compliance requirements, and party obligations. The document includes detailed terms for payment execution, default scenarios, and remedies, while ensuring compliance with UAE Central Bank regulations and anti-money laundering requirements.

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What is a Third Party Payment Contract?

A Third Party Payment Contract is essential in commercial arrangements where payment obligations are fulfilled by a party other than the primary debtor. This document type, governed by UAE law, is commonly used in various business scenarios including corporate group transactions, project finance arrangements, and international trade. The contract establishes the legal framework for payment obligations, defining the roles and responsibilities of the principal debtor, the third-party payer, and the beneficiary. It includes crucial provisions for payment mechanisms, compliance with UAE banking regulations, anti-money laundering requirements, and appropriate security measures. The document is particularly relevant in the UAE's business environment, where complex international transactions and multi-party payment arrangements are common.

What sections should be included in a Third Party Payment Contract?

1. Parties: Identification of all parties: the principal debtor, the creditor/beneficiary, and the third-party payer

2. Background: Context of the agreement, relationship between parties, and reason for third-party payment arrangement

3. Definitions: Key terms used throughout the agreement, including payment-related terminology

4. Payment Obligations: Details of payment amounts, currency, timing, and conditions precedent to payment

5. Payment Mechanism: Specific process and method of payment, including banking details and transaction procedures

6. Representations and Warranties: Statements of fact and assurances from each party regarding their capacity and authority

7. Rights and Obligations: Detailed responsibilities of each party, including notification requirements and record-keeping

8. Default and Remedies: Consequences of payment default and available remedies for affected parties

9. Term and Termination: Duration of the agreement and circumstances under which it can be terminated

10. Governing Law and Jurisdiction: Specification of UAE law as governing law and jurisdiction for dispute resolution

11. Notices: Process and requirements for formal communications between parties

12. General Provisions: Standard boilerplate clauses including severability, entire agreement, and amendments

What sections are optional to include in a Third Party Payment Contract?

1. Electronic Payment Provisions: Required when payments will be made electronically, including specific security and authentication requirements

2. Currency Exchange: Needed when payments involve multiple currencies or exchange rate considerations

3. Anti-Money Laundering Compliance: Detailed compliance provisions required for high-value or frequent payments

4. Security and Guarantees: Required when additional security or guarantees are provided for the payment obligations

5. Force Majeure: Optional clause for circumstances preventing payment performance, particularly relevant for long-term arrangements

6. Confidentiality: Required when sensitive financial or commercial information is involved

7. Step-In Rights: Optional provisions allowing other parties to step in and make payments in case of default

8. Insurance Requirements: Needed when specific insurance coverage is required for payment obligations

What schedules should be included in a Third Party Payment Contract?

1. Payment Schedule: Detailed schedule of payment amounts, dates, and recipients

2. Bank Account Details: Specified bank account information for all parties

3. Form of Payment Notice: Template for payment notifications and confirmations

4. Compliance Documentation: Required forms and documents for regulatory compliance

5. Security Documents: If applicable, details of any security or guarantees provided

6. Contact Details: List of authorized representatives and contact information for all parties

7. Payment Procedures: Detailed operational procedures for making and processing payments

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Publisher

Genie AI

Document Type

Payment Agreement

Sector

Banking

Cost

Free to use
Relevant Industries

Banking & Financial Services

International Trade

Real Estate & Construction

Manufacturing

Retail & Consumer Goods

Energy & Resources

Transportation & Logistics

Professional Services

Healthcare

Hospitality & Tourism

Relevant Teams

Legal

Finance

Treasury

Compliance

Procurement

Risk Management

Commercial Operations

Accounts Payable

Banking Operations

Contract Administration

Relevant Roles

Chief Financial Officer

Finance Director

Treasury Manager

Financial Controller

Accounts Payable Manager

Legal Counsel

Compliance Officer

Commercial Director

Procurement Manager

Contract Manager

Risk Manager

Company Secretary

Banking Relationship Manager

Finance Operations Manager

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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