Affidavit Of Guarantee Template for Saudi Arabia

An Affidavit of Guarantee is a sworn legal declaration that establishes your formal commitment to fulfill another party's obligations should they fail to meet their responsibilities. In Saudi Arabia, this document must align with both Shariah law principles and the Kingdom's civil procedure requirements, making it a critical instrument for securing business transactions and financial arrangements.

When do you need this document?

You'll need an Affidavit of Guarantee when providing security for someone else's financial or contractual obligations in Saudi Arabia. This commonly occurs when guaranteeing loan repayments for family members or business partners, securing commercial contracts where you're acting as a guarantor for project completion, or when your company needs to provide assurance for subsidiary operations. Banks and financial institutions frequently require these documents when extending credit, and government contracts often mandate guarantee provisions from third parties. The document is also essential when establishing joint ventures or partnerships where one party needs assurance of the other's performance capabilities.

Key legal considerations

Your Affidavit of Guarantee must comply with the Islamic concept of Kafala, which governs guarantee arrangements under Shariah law. The document requires explicit identification of all parties, including the guarantor, principal debtor, and beneficiary, along with Saudi ID or Iqama numbers. You must clearly state the scope and limitations of your guarantee, specify whether it covers principal amounts only or includes additional costs like penalties and legal fees, and define the duration of your guarantee obligation. The affidavit must include a declaration of your legal capacity and sound mind, confirming you're acting under free will without coercion. Witnesses are typically required, and the document must be executed in Arabic or include certified translations if originally drafted in another language.

Legal requirements in Saudi Arabia

Under Saudi Arabian law, your Affidavit of Guarantee must be notarized by an authorized notary public and may require authentication through the Chamber of Commerce or relevant ministry depending on the transaction type. The Civil Procedure Law (2013) mandates specific formatting and content requirements for legal enforceability. If the guarantee involves banking transactions, compliance with the Banking Control Law is essential, while commercial guarantees must align with Commercial Court Law provisions. The document must be registered with appropriate authorities if it exceeds certain monetary thresholds or involves real estate transactions. You should ensure the guarantee terms don't conflict with Shariah prohibitions on excessive uncertainty (gharar) or interest-based arrangements (riba), and consider obtaining legal counsel to verify compliance with both religious and civil law requirements before execution.