Article 88 of the Saudi Commercial Maritime Law
المادة 88 من النظام البحري التجاري · الفصل الثاني: الحجز التنفيذي والبيع الجبري
The person to whom a ship auction is awarded pays 20% of the price at once and deposits the balance and expenses in the court treasury within seven days at most, otherwise the ship is resold at his risk.
Official text (Arabic)
This article has not been amended since the law was issued.
يجب على من يرسو عليه المزاد أن يدفع (20%) من الثمن فور رسو المزاد عليه، على أن يودع الباقي والمصروفات في خزانة المحكمة خلال سبعة أيام على الأكثر من تاريخ رسو المزاد، وإلا أعيد بيع السفينة على مسؤوليته.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 88 explained in plain English
This article specifies the payment obligations of the person to whom the ship auction is awarded:
- Immediately on award: he pays 20% of the price.
- Within seven days at most of the date of award: he deposits the balance of the price and the expenses in the court treasury.
If he fails to do so, the ship is resold at his risk. This means the defaulting buyer bears the consequences of the resale, which deters anyone who bids without seriousness or the ability to pay.
The provision is understood in the context of the compulsory sale procedures: Article 87 deals with the case where no bid is made on the day appointed for the sale, in which the court fixes a new, lower base price. Article 89 provides that the judgment awarding the auction may be challenged only for a defect in the bidding procedures or in the form of the judgment, within fifteen days.
Anyone intending to take part in a ship auction should prepare the necessary liquidity in advance. Consult a lawyer who specializes in enforcement and maritime law.
Practical example
A ship auction was awarded to a company in Dammam at SAR 10,000,000. The company pays SAR 2,000,000 (20%) at once and must deposit the balance and expenses in the court treasury within seven days, otherwise the ship is resold at its risk.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 88 of the Saudi Commercial Maritime Law
How much must the person to whom a ship auction is awarded pay immediately?
20% of the price, immediately on the award of the auction to him.
What is the deadline for paying the balance of the price of the ship?
Seven days at most from the date of the award, within which he deposits the balance and the expenses in the court treasury.
What happens if the buyer does not pay the balance?
The ship is resold at his risk.
More articles on Precautionary and Executory Attachment of Ships
- Article 44
The article provides that if shares representing more than half the ship are attached, the judicial sale covers the whole ship, though the court may limit it to the attached shares for serious reasons at the request of an owner whose shares were not attached.
إذا وقع الحجز على حصص تمثل أكثر من نصف السفينة شمل البيع القضائي السفينة بأكملها. ومع ذلك يجوز أن تأمر المحكمة -بناءً على طلب أحد المالكين الذين لم يحجز على حصص
- Article 67
Mortgagee creditors may pursue the mortgaged ship into any hands and apply for a precautionary attachment, and the ship may not be disposed of once the attachment report is registered in the ship register.
الدائنون المرتهنون لسفينة، أو لجزء منها، يتتبعونها في أي يد كانت، ولهم حق التقدم بطلب الحجز التحفظي عليها، ولا يجوز التصرف في السفينة المرهونة بعد قيد محضر حجزه
- Article 68
If half of the ship or less is mortgaged, the creditor may attach and sell only the mortgaged part; if more than half, the court may order the sale of the whole ship, and co-owners must be notified fifteen days before the sale.
1- إذا كان الرهن واقعاً على جزء لا يزيد على نصف السفينة فليس للدائن إلا حجز هذا الجزء وبيعه، وإذا كان الرهن واقعاً على أكثر من نصف السفينة جاز للمحكمة -بناء على
- Article 69
Carrying out a court order for the sale of the ship clears it of all mortgages, and the rights of mortgagee creditors shift from the ship to its price.
يترتب على تنفيذ الأمر القضائي بالبيع تطهير السفينة من جميع الرهون، وتنتقل حقوق الدائنين إلى الثمن.
- Article 70
If ownership of the mortgaged ship has passed before the attachment report is registered, the creditor notifies the possessor of the attachment and demands the price; the possessor may avoid attachment and sale by notifying the registered creditors within the period and stating his readiness to pay.
1- إذا انتقلت ملكية السفينة المرهونة، أو بعضها -قبل قيد محضر الحجز- فعلى الدائن المرتهن الذي اتخذ إجراءات التنفيذ على السفينة أن يبلغ الحائز للسفينة بمحضر الحجز
- Article 71
When ownership of a mortgaged ship has passed under Article 70, each creditor may request its sale by judgment of the competent court with a guarantee for the price and expenses, and the request is notified to the possessor within ten days.
1- يجوز لكل دائن في الحالة المبينة في المادة (السبعين) أن يطلب بيع السفينة أو جزء منها بحكمٍ من المحكمة المختصة، مع تقديم كفالة بالثمن والمصروفات، وتكليف الحائز
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.