Article 35 of the Saudi Commercial Papers Law
المادة 35 من نظام الأوراق التجارية · الفصل الخامس: الضمان الاحتياطي
Article 35 allows payment of all or part of the amount of a bill of exchange to be guaranteed by a surety (aval), who may be any person, even one who signed the bill.
Official text (Arabic)
This article has not been amended since the law was issued.
يجوز ضمان وفاء مبلغ الكمبيالة كله أو بعضه من ضامن احتياطي، ويكن هذا الضمان من أي شخص ولو كان ممن وقعوا الكمبيالة .
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 35 explained in plain English
The surety (aval) is a means of strengthening confidence in a bill of exchange, since it adds a new obligor who guarantees payment of its amount. Article 35 sets out two rules:
- The scope of the guarantee: the surety may guarantee the whole amount of the bill, or only part of it.
- Who may be a surety: any person, even one who originally signed the bill, such as one of the endorsers.
Article 36 explains how this guarantee is written and signed, the consequence of not naming the person guaranteed, and that it may be given on a separate paper in which the surety is bound only toward the person in whose favor the guarantee was given.
Those dealing with the bill benefit from this, since the number of persons bound to pay it increases. The permissibility of a partial guarantee allows the surety to define the limits of the obligation precisely, so that he or she is not claimed against for more than what was guaranteed.
Anyone intending to guarantee a bill of exchange for another would do well to consult a lawyer specializing in commercial cases and commercial papers before signing, to know the limits of the liability.
Practical example
A small establishment in Riyadh bought goods on credit, and the seller asked for a guarantee on the bill of exchange the establishment drew. Its owner Khalid signed as surety for only SAR 50,000 of the SAR 80,000. Article 35 permits this partial guarantee, so Khalid's guarantee is limited to SAR 50,000.
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 35 of the Saudi Commercial Papers Law
May only part of the amount of a bill of exchange be guaranteed?
Yes, Article 35 allows payment of all or part of the amount of the bill to be guaranteed.
May a person who signed the bill be a surety for it?
Yes, the guarantee may come from any person, even one who signed the bill.
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.