Article 11 of the Saudi Commercial Papers Law
المادة 11 من نظام الأوراق التجارية · الفصل الأول: إنشاء الكمبيالة
Article 11 makes the drawer of a bill of exchange guarantee its acceptance and payment, and allows the drawer to stipulate exemption from guaranteeing acceptance but not payment.
Official text (Arabic)
This article has not been amended since the law was issued.
يضمن صاحب الكمبيالة قبولها ووفاءها، ويجوز أن يشترط إعفاءه من ضمان القبول دون ضمان الوفاء.
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 11 explained in plain English
This article sets out a guarantee that the drawer of a bill of exchange bears by operation of law, covering two things:
- Guarantee of acceptance: that the drawee accepts the bill of exchange when it is presented to them.
- Guarantee of payment: that the value of the bill of exchange is paid on its due date.
The article allows this guarantee to be reduced within narrow limits: the drawer may stipulate exemption from guaranteeing acceptance, but may not be exempted from guaranteeing payment. Whatever is written on the bill, the drawer remains a guarantor of payment of its value.
The article uses the phrase "the drawer of the bill of exchange," and it appears in the first chapter, which concerns the creation of the bill of exchange. The practical benefit of this rule is that the holder can rest assured that the person who created the bill cannot escape the guarantee of its payment through a condition written on it.
This differs from the rule in Article 10 for a person who signs on behalf of another without authority, who becomes personally bound. To learn how to recover from the guarantors in a particular case, you can consult a lawyer specializing in commercial cases and commercial papers.
Practical example
An establishment in Khobar drew a bill of exchange on one of its customers in favor of a supplier and wrote on it "without guarantee of acceptance." This condition is permitted under Article 11, but had it written "without guarantee of payment," that would not relieve it of the guarantee of paying the bill's value.
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 11 of the Saudi Commercial Papers Law
Does the drawer of a bill of exchange guarantee its payment?
Yes, the article provides that the drawer of a bill of exchange guarantees its acceptance and payment.
Can the drawer be exempted from guaranteeing payment?
No, the drawer may stipulate exemption from guaranteeing acceptance but not from guaranteeing payment.
More articles on Bill of Exchange
- Article 1
The article sets out the eight particulars a bill of exchange must contain, including the word "bill of exchange", the amount, the name of the drawee, the due date and the drawer's signature.
تشتمل الكمبيالة على البيانات الآتية: أ - كلمة (كمبيالة) مكتوبة في متن الصك وباللغة التي كتب بها. ب - أمر غير معلق على شرط بوفاء مبلغ معين من النقود. ج - اسم من
- Article 2
An instrument lacking the particulars of Article 1 is not a bill of exchange, except where the due date, place of payment, drawee's domicile or place of issue is missing, each of which has a substitute rule.
لا يعتبر الصك الخالي من البيانات المذكورة في المادة السابقة كمبيالة إلا في الأحوال الآتية: أ - إذا خلت الكمبيالة من بيان ميعاد الاستحقاق، اعتبرت مستحقة الوفاء ل
- Article 3
The article permits three ways of drawing a bill of exchange: to the drawer's own order, on the drawer himself, or for the account of another person.
يجوز سحب الكمبيالة لأمر الساحب نفسه، ويجوز سحبها على ساحبها، ويجوز سحبها لحساب شخص آخر.
- Article 4
The article permits stipulating that a bill of exchange be paid at the domicile of a person other than the drawee, whether in the drawee's town or in another.
يجوز اشتراط وفاء الكمبيالة في موطن شخص آخر غير المسحوب عليه سواء كان هذا الموطن في الجهة التي فيها موطن المسحوب عليه أو في جهة أخرى.
- Article 5
If the amount of a bill written in words differs from the amount in figures, the words prevail; if the amount is written several times and differs, the smaller amount prevails.
إذا كتب مبلغ الكمبيالة بالحروف وبالأرقام معا فتكون العبرة عند الاختلاف بالمكتوب بالحروف، وإذا كتب المبلغ عدة مرات بالحروف أو بالأرقام فتكون العبرة عند الاختلاف
- Article 6
Article 6 provides that any stipulation of interest on the amount of a bill of exchange is treated as if it had not been written.
اشتراط فائدة الكمبيالة يعتبر كأن لم يكن.
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.