Sales Agreement for Saudi Arabia

Sales Agreement Template for Saudi Arabia

A comprehensive legal document governed by Saudi Arabian law that establishes the terms and conditions for the sale of goods between parties. This agreement incorporates requirements from Saudi commercial law and Shariah principles, detailing essential elements such as price, payment terms, delivery conditions, warranties, and risk transfer. The document ensures compliance with local regulations while providing a clear framework for commercial transactions, including provisions for dispute resolution under Saudi jurisdiction and consideration of Islamic commercial principles.

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What is a Sales Agreement?

The Sales Agreement is a fundamental commercial contract used in Saudi Arabia to formalize the sale and purchase of goods between parties. It serves as the primary document for establishing the rights, obligations, and responsibilities of both sellers and buyers in commercial transactions. This agreement must comply with Saudi Arabian commercial law and Shariah principles, making it distinct from sales agreements in other jurisdictions. The document typically includes detailed provisions on payment terms, delivery arrangements, quality standards, and warranty conditions, while ensuring that all financial aspects remain Shariah-compliant. It's particularly important in the Saudi business environment where formal documentation of commercial relationships is essential for legal protection and dispute resolution.

What sections should be included in a Sales Agreement?

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

2. Background: Context of the sale and relationship between the parties

3. Definitions: Key terms used throughout the agreement

4. Sale and Purchase: Core transaction terms including description of goods and purchase price

5. Delivery: Delivery terms, timing, and logistics

6. Price and Payment: Payment terms, method, and schedule

7. Title and Risk: Transfer of ownership and risk in the goods

8. Warranties and Representations: Promises and assurances about the goods and parties' capacity

9. Quality and Inspection: Quality standards and buyer's inspection rights

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

11. Confidentiality: Protection of confidential information

12. Force Majeure: Handling of events beyond parties' control

13. Governing Law and Jurisdiction: Application of Saudi law and dispute resolution

14. General Provisions: Standard boilerplate clauses including notices and amendments

What sections are optional to include in a Sales Agreement?

1. Intellectual Property: Required when the sale involves software, branded goods, or licensed products

2. Export/Import Controls: Necessary for international sales or restricted goods

3. Insurance: Required for high-value goods or when specific insurance arrangements are needed

4. Training and Support: Include when the sale includes technical equipment or systems requiring training

5. Compliance with Shariah: Detailed section needed for financial products or complex payment structures

6. Security: Required when payment guarantees or security interests are involved

7. Anti-corruption: Important for high-value deals or government-related sales

8. Data Protection: Necessary when personal data processing is involved in the sale

What schedules should be included in a Sales Agreement?

1. Schedule 1 - Specification of Goods: Detailed technical specifications of the goods being sold

2. Schedule 2 - Pricing Schedule: Detailed pricing information, including any volume discounts or special pricing terms

3. Schedule 3 - Delivery Schedule: Detailed delivery timelines and locations

4. Schedule 4 - Quality Standards: Specific quality requirements and testing procedures

5. Schedule 5 - Warranty Terms: Detailed warranty terms and procedures

6. Schedule 6 - Service Level Agreement: If applicable, details of ongoing service or support requirements

7. Appendix A - Required Documentation: List of required certificates, permits, and documentation

8. Appendix B - Form of Acceptance Certificate: Template for formal acceptance of goods

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

Jurisdiction

Saudi Arabia

Publisher

Genie AI

Document Type

Agreement Contract

Cost

Free to use

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