Installment Sales Contract Template for Saudi Arabia

The Installment Sales Contract is essential for transactions in Saudi Arabia where goods or assets are sold with payment spread over multiple installments. This document is commonly used in both consumer and commercial contexts, particularly for high-value assets such as vehicles, equipment, or machinery. It must comply with Saudi Arabian law, including the Finance Companies Control Law and SAMA regulations, while adhering to Islamic finance principles that prohibit conventional interest (riba). The contract typically includes detailed specifications of the asset, payment terms, delivery conditions, and ownership transfer provisions. It's particularly important in sectors where financing is common and helps protect both seller and buyer interests while ensuring regulatory compliance. The document becomes crucial when businesses need to document deferred payment arrangements while maintaining Shariah compliance in the Saudi Arabian market.

1. Parties: Identification of the seller and purchaser with full legal names and addresses

2. Background: Context of the sale and brief description of the transaction

3. Definitions: Key terms used throughout the agreement, including defined payment terms

4. Sale and Purchase: Clear description of the asset being sold and confirmation of the sale transaction

5. Purchase Price and Payment Terms: Total purchase price, down payment, installment amounts, and payment schedule

6. Delivery and Acceptance: Terms regarding delivery of the asset and acceptance procedures

7. Title and Risk: Provisions regarding transfer of ownership and risk in the asset

8. Seller's Warranties: Warranties regarding the asset's condition, ownership, and compliance with specifications

9. Purchaser's Obligations: Key obligations including payment, maintenance, and insurance requirements

10. Default and Consequences: Events of default and remedies available to either party

11. Insurance: Requirements for insurance coverage of the asset during the installment period

12. Governing Law and Jurisdiction: Confirmation of Saudi law application and jurisdiction for disputes

13. Notices: Process for formal communications between parties

14. General Provisions: Standard boilerplate clauses including amendment process, severability, and entire agreement