Article 101 of the Saudi Commercial Papers Law
المادة 101 من نظام الأوراق التجارية · الفصل الرابع: الضمان الاحتياطي
The Article allows payment of all or part of a check's amount to be guaranteed by aval from a third party other than the drawee, or from one of the signatories of the check.
Official text (Arabic)
This article has not been amended since the law was issued.
يجوز ضمان وفاء مبلغ الشيك كله أو بعضه من ضامن احتياطي، ويكون هذا الضمان من الغير عدا المسحوب عليه، كما يجوز أن يكون من أحد الموقعين على الشيك.
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 101 explained in plain English
This Article deals with aval (the guarantee) of a check, whereby a person undertakes to guarantee payment of the check alongside those liable on it, which increases the holder's confidence of collecting its value.
The Article provides the following:
- Scope of the guarantee: the guarantor by aval may guarantee all or part of the amount of the check.
- Who may be a guarantor: any third party, other than the drawee; the guarantor may also be one of the signatories of the check.
The drawee therefore may not be a guarantor by aval of the check. This is consistent with Article 100, which bars the drawee from accepting a check and allows it to certify it.
This Article does not address the form of the guarantee, how it is written, or the extent of the guarantor's liability. It is followed by Article 102, which makes a check payable on sight. Anyone asked to be a guarantor by aval of a check who wants to understand its possible consequences would do well to consult a lawyer who specializes in commercial matters and commercial papers.
Practical example
A supplier asked a start-up company in Riyadh for a check for SAR 50,000 with a guarantor. A partner in the company agreed to be guarantor by aval for half the amount. This is permitted under the Article, because a guarantee may cover part of the check's amount and may come from a third party other than the drawee.
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 101 of the Saudi Commercial Papers Law
May only part of a check's amount be guaranteed?
Yes. The Article allows payment of all or part of the check's amount to be guaranteed.
May the drawee bank be a guarantor by aval?
No. The guarantee comes from a third party other than the drawee.
May one of the signatories of the check guarantee it?
Yes. The Article provides that the guarantee may come from one of the signatories of the check.
More articles on The Check
- Article 91
The Article lists the mandatory particulars of a check: the word check, an unconditional order to pay a fixed sum, the drawee's name, place of payment, date and place of issue, and the drawer's signature.
يشتمل الشيك على البيانات الآتية: أ - كلمة (شيك) مكتوبة في متن الصك باللغة التي كتب بها. ب - أمر غير معلق على شرط بوفاء مبلغ معين من النقود. جـ - اسم من يلزمه ال
- Article 92
The Article provides that an instrument lacking a check particular listed in Article 91 is not a check, unless the missing particular is the place of payment or the place of issue.
الصك الخالي من أحد البيانات المذكورة في المادة السابقة لا يعتبر شيكا إلا في الحالتين الآتيتين: أ - إذا خلا الشيك من بيان مكان وفائه اعتبر مستحق الوفاء في المكان
- Article 93
The Article requires checks issued in the Kingdom and payable there to be drawn on a bank, and treats instruments drawn on anyone other than a bank as invalid checks.
لا يجوز سحب الشيكات الصادرة في المملكة والمستحقة الوفاء فيها إلا على بنك، والصكوك المسحوبة في صورة شيكات على غير بنك لا تعتبر شيكات صحيحة.
- Article 94
The Article bars issuing a check unless the drawer has funds with the drawee that can be disposed of by check at the time of issue, and requires the drawer to prove cover if denied; lack of cover does not void the check.
لا يجوز إصدار شيك ما لم يكن للساحب لدى المسحوب عليه وقت إنشاء الشيك نقود يستطيع التصرف فيها بموجب شيك طبقا لاتفاق صريح أو ضمني. وعلى ساحب الشيك أو الآمر غيره بس
- Article 95
The Article allows a check to be payable to a named person with or without an order clause, to a named person with a not-to-order clause, or to bearer, and sets when a check counts as a bearer check.
يجوز اشتراط وفاء الشيك إلى: أ - شخص معين مع النص صراحة على شرط الأمر أو بدونه. ب - شخص معين مع ذكر شرط (ليس لأمر) أو أية عبارة أخرى تفيد هذا المعنى. جـ - حامل ا
- Article 96
The Article allows a check to be drawn to the drawer's own order or for another person's account, and bars drawing it on the drawer himself except between branches of one bank, provided it is not a bearer check.
يجوز سحب الشيك لأمر الساحب نفسه، ويجوز سحبه لحساب شخص آخر، ولا يجوز سحبه على الساحب نفسه ما لم يكن مسحوبا بين فروع بنك يسيطر عليه مركز رئيسي واحد ويشترط ألا يكو
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.