Investment Advisory Agreement Template for Saudi Arabia

The Investment Advisory Agreement is a crucial document used when establishing a formal relationship between an investment advisor and a client in Saudi Arabia. It serves as the primary contractual framework defining the provision of investment advisory services, ensuring compliance with the Capital Market Authority (CMA) regulations and Sharia law principles. This agreement is essential for investment firms operating in Saudi Arabia who provide advisory services to various types of clients, from individual investors to institutional entities. The document comprehensively covers service scope, regulatory compliance, fee structures, risk management, and reporting requirements, while incorporating necessary provisions for Islamic finance principles. It's designed to protect both parties' interests while ensuring transparency and regulatory compliance in the Saudi Arabian investment landscape.

1. Parties: Identification of the investment advisor and the client, including their full legal names, addresses, and registration details

2. Background: Context of the agreement, including advisor's licensing status with CMA and client's intention to receive investment advisory services

3. Definitions: Key terms used throughout the agreement, including regulatory and technical terms

4. Appointment and Scope of Services: Formal appointment of advisor and detailed description of investment advisory services to be provided

5. Regulatory Compliance: Confirmation of compliance with CMA regulations and Sharia principles

6. Representations and Warranties: Statements by both parties regarding their capacity, authority, and compliance status

7. Duties and Responsibilities: Detailed obligations of the advisor including reporting, monitoring, and communication requirements

8. Client's Obligations: Client's responsibilities including information provision and cooperation requirements

9. Fees and Payment Terms: Advisory fees, calculation method, payment schedule, and expenses

10. Confidentiality: Protection and handling of confidential information

11. Conflicts of Interest: Procedures for identifying, disclosing, and managing conflicts of interest

12. Term and Termination: Duration of agreement and circumstances for termination

13. Liability and Indemnification: Extent of advisor's liability and mutual indemnification provisions

14. Force Majeure: Provisions for unforeseeable circumstances preventing performance

15. Governing Law and Jurisdiction: Application of Saudi law and jurisdiction for disputes

16. Notices: Methods and addresses for formal communications

17. General Provisions: Standard clauses including amendments, assignment, and severability