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Supply Agreement Contract for Saudi Arabia

Supply Agreement Contract Template for Saudi Arabia

A comprehensive commercial agreement governed by Saudi Arabian law that establishes the terms and conditions for the supply of goods between parties. This document addresses key aspects including delivery terms, pricing mechanisms, quality standards, and compliance with local regulations including Sharia law principles. It incorporates specific Saudi legal requirements such as commercial registration requirements, import/export regulations, and considerations for both Arabic and English versions where necessary. The agreement includes detailed provisions for payment terms, warranties, dispute resolution under Saudi jurisdiction, and necessary compliance with local commercial practices.

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What is a Supply Agreement Contract?

The Supply Agreement Contract is a fundamental commercial document used to formalize the relationship between suppliers and buyers operating within or into Saudi Arabia. It is particularly important given Saudi Arabia's unique legal framework, which combines modern commercial law with Sharia principles. This document is essential when establishing ongoing supply relationships, whether for domestic Saudi trade or international commerce involving Saudi entities. The agreement typically covers critical aspects such as product specifications, delivery terms, pricing, quality standards, and compliance with Saudi regulations including import/export requirements. It's designed to protect both parties' interests while ensuring compliance with local laws, including the Commercial Court Law and relevant Royal Decrees. The document becomes especially crucial when dealing with regular supply arrangements, high-value transactions, or strategic supply relationships in the Saudi market.

What sections should be included in a Supply Agreement Contract?

1. Parties: Identification of the supplier and buyer, including their full legal names, commercial registration numbers, and authorized representatives

2. Background: Context of the agreement and brief description of the parties' business relationship

3. Definitions: Definitions of key terms used throughout the agreement, including technical and commercial terms

4. Supply Obligations: Core obligations of the supplier, including product specifications, quality standards, and delivery requirements

5. Ordering Process: Procedures for placing and accepting orders, including minimum order quantities and lead times

6. Pricing and Payment: Price determination, payment terms, invoicing requirements, and currency specifications

7. Delivery and Risk: Delivery terms, transfer of risk, shipping requirements, and Incoterms specification

8. Quality and Inspection: Quality standards, inspection rights, acceptance criteria, and rejection procedures

9. Warranties: Product warranties, quality guarantees, and compliance with Saudi standards and regulations

10. Term and Termination: Duration of the agreement, renewal terms, and termination rights

11. Compliance with Laws: Obligations to comply with Saudi laws, including Sharia principles and import regulations

12. Confidentiality: Protection of confidential information and trade secrets

13. Dispute Resolution: Process for resolving disputes under Saudi law, including jurisdiction and venue

14. General Provisions: Standard boilerplate clauses adapted to Saudi law requirements

What sections are optional to include in a Supply Agreement Contract?

1. Exclusivity: Used when the supplier is granted exclusive rights in certain territories or for certain products

2. Minimum Purchase Commitments: Include when there are guaranteed minimum purchase volumes

3. Storage and Warehousing: Required when the agreement includes storage obligations for either party

4. Insurance: Detailed insurance requirements beyond standard coverage

5. Force Majeure: Specific force majeure provisions adapted to the supply relationship

6. Anti-Corruption: Enhanced compliance provisions for high-risk or government-related contracts

7. Training and Support: Include when supplier must provide technical training or ongoing support

8. Intellectual Property: Required when IP rights are being licensed as part of the supply relationship

9. Language: Required when both Arabic and English versions are provided, specifying which version prevails

What schedules should be included in a Supply Agreement Contract?

1. Schedule 1 - Product Specifications: Detailed technical specifications of products being supplied

2. Schedule 2 - Pricing Schedule: Detailed pricing information, including any volume discounts or price adjustment mechanisms

3. Schedule 3 - Service Levels: Performance metrics and service level requirements

4. Schedule 4 - Delivery Locations: List of approved delivery locations and any specific delivery requirements

5. Schedule 5 - Quality Standards: Detailed quality requirements and testing procedures

6. Schedule 6 - Key Personnel: List of key contacts and authorized representatives for both parties

7. Schedule 7 - Forms: Standard forms for purchase orders, delivery receipts, and quality certificates

8. Appendix A - Compliance Requirements: Specific Saudi regulatory requirements applicable to the products

9. Appendix B - Technical Documentation: Required technical documentation, certificates, and compliance documents

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Saudi Arabia

Publisher

Ƶ

Document Type

Service Agreement

Cost

Free to use
Relevant legal definitions



















































Clauses



















































Relevant Industries

Manufacturing

Retail

Oil & Gas

Construction

Healthcare

Technology

Automotive

Food & Beverage

Industrial Equipment

Consumer Goods

Pharmaceuticals

Chemicals

Electronics

Telecommunications

Mining

Agriculture

Relevant Teams

Legal

Procurement

Supply Chain

Operations

Finance

Compliance

Commercial

Sales

Quality Assurance

Logistics

Risk Management

Business Development

Relevant Roles

Procurement Manager

Supply Chain Director

Commercial Director

Legal Counsel

Contracts Manager

Operations Manager

Compliance Officer

Chief Financial Officer

Sales Director

Business Development Manager

Import/Export Manager

Quality Assurance Manager

Logistics Manager

General Counsel

Managing Director

Chief Operating Officer

Industries










Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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