The Consulting Engagement Letter serves as the primary document establishing a professional services relationship in Saudi Arabia. It is typically used when a consultant or consulting firm is engaged to provide specialized services to a client, whether a private company, government entity, or other organization. The document must comply with Saudi Arabian commercial law, including Royal Decree No. M/32, the Professional Companies Law, and relevant Sharia principles. This type of engagement letter includes essential elements such as scope of services, fee structures, timelines, deliverables, and professional obligations, while incorporating specific Saudi regulatory requirements such as VAT considerations and commercial registration requirements. The Consulting Engagement Letter is particularly important in the Saudi context as it helps ensure clarity in professional relationships and compliance with local business practices and legal frameworks.
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1. Date and Address Block: Formal letter heading with date and recipient details
2. Salutation: Professional greeting to the client
3. Introduction: Identification of the parties and brief statement of purpose
4. Engagement Overview: High-level description of the consulting services to be provided
5. Scope of Services: Detailed description of specific services, deliverables, and any excluded services
6. Term and Timeline: Duration of the engagement and key milestone dates
7. Fees and Payment Terms: Consulting fees, payment schedule, and invoicing details including VAT considerations
8. Professional Standards: Commitment to quality and professional standards
9. Confidentiality: Confidentiality obligations and information handling
10. Client Responsibilities: Clear outline of what is expected from the client
11. Points of Contact: Key personnel and communication protocols
12. Acceptance and Execution: Signature blocks and acceptance terms
1. Sharia Compliance Statement: Statement confirming the engagement's compliance with Islamic law principles, used when specifically required by the client or nature of services
2. Intellectual Property Rights: Specific provisions regarding ownership of deliverables and pre-existing IP, used for engagements involving significant intellectual property
3. Force Majeure: Provisions for unforeseen circumstances, used in longer or more complex engagements
4. Dispute Resolution: Specific dispute resolution procedures, used in higher-value or complex engagements
5. Insurance Coverage: Details of professional indemnity and other relevant insurance, used for high-risk engagements
6. Data Protection: Specific data handling and protection provisions, used when engagement involves sensitive data processing
7. Subcontracting: Terms regarding use of subcontractors, used when engagement may require additional expertise
8. Travel and Expenses: Detailed terms for reimbursement of expenses, used when significant travel or expenses are expected
1. Schedule A - Detailed Scope of Work: Comprehensive breakdown of services, deliverables, and methodology
2. Schedule B - Fee Schedule: Detailed breakdown of fees, payment milestones, and any rate cards
3. Schedule C - Project Timeline: Detailed project plan with milestones and deliverable dates
4. Schedule D - Key Personnel: Profiles and roles of key team members assigned to the engagement
5. Appendix 1 - Required Documents: List of documents required from client for engagement execution
6. Appendix 2 - Compliance Requirements: Specific Saudi regulatory requirements applicable to the engagement
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