Article 42 of the Saudi Commercial Papers Law
المادة 42 من نظام الأوراق التجارية · الفرع الأول: زمن الوفاء
Article 42 makes the calendar of the country of payment the one used to fix the maturity of a bill of exchange where it differs from that of the country of issue, unless a contrary intention is clear.
Official text (Arabic)
This article has not been amended since the law was issued.
إذا كانت الكمبيالة مستحقة الوفاء في يوم معين وفي بلد يختلف فيه التقويم عن تقويم بلد إصدارها تحدد ميعاد الاستحقاق وفقا لتقويم بلد الوفاء.
وإذا سحبت الكمبيالة بين بلدين مختلفي التقويم وكانت مستحقة الوفاء بعد مدة من تاريخها وجب إرجاع تاريخ إصدارها إلى اليوم المقابل في تقويم بلد الوفاء، ويحدد ميعاد الاستحقاق وفقا لذلك. ويحسب ميعاد تقديم الكمبيالة وفقا للأحكام السابقة.
ولا تسري الأحكام المتقدمة إذا اتضح من شرط في الكمبيالة أو من بياناتها قصد اتباع قواعد مخالفة.
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 42 explained in plain English
A bill of exchange may be issued in a country that uses one calendar and fall due in a country that uses another, such as where the Hijri calendar differs from the Gregorian. Article 42 deals with this case as follows:
- A bill payable on a specified day: the maturity date is fixed according to the calendar of the country of payment.
- A bill payable at a fixed period after its date: if it is drawn between two countries with different calendars, the date of issue is converted to the corresponding day in the calendar of the country of payment, and maturity is then fixed on that basis.
- The period for presentment: it is calculated according to the same rules.
- The exception: these rules do not apply if it is clear from a condition in the bill or from its particulars that the intention is to follow different rules.
The rule is therefore that the calendar of the country of payment is the reference, because that is the country in which the bill will be paid, but the parties may agree otherwise provided this intention appears from the bill itself. This article complements the rules for calculating periods in Article 41.
In cross-border transactions, it is advisable to consult a lawyer specializing in commercial cases and commercial papers to settle the particulars and dates of the bill.
Practical example
A company in a country using the Gregorian calendar issued a bill of exchange in favor of a supplier, payable in Riyadh 3 months after its date, assuming the country of payment uses a different calendar. Under Article 42, the date of issue is converted to the corresponding day in the calendar of the country of payment and the three months are then counted on that basis, unless the bill contains a condition showing an intention to follow another rule.
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 42 of the Saudi Commercial Papers Law
Which calendar applies if a bill is issued in one country and paid in another?
If it is payable on a specified day in a country whose calendar differs from that of the country of issue, maturity is fixed according to the calendar of the country of payment.
May the parties agree to follow another calendar?
Yes, Article 42 does not apply if it is clear from a condition in the bill or from its particulars that the intention is to follow different rules.
More articles on Payment of a Bill and Protest
- 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 11
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.
يضمن صاحب الكمبيالة قبولها ووفاءها، ويجوز أن يشترط إعفاءه من ضمان القبول دون ضمان الوفاء.
- Article 15
Article 15 makes the endorser guarantee acceptance and payment of the bill of exchange unless otherwise stipulated, and lets the endorser prohibit re-endorsement, in which case the endorser does not guarantee to those who receive the bill by a later endorsement.
يضمن المظهر قبول الكمبيالة ووفائها ما لم يشترط غير ذلك. ويجوز له حظر تظهيرها من جديد، وفي هذه الحالة لا يكون ملزما بالضمان لمن تؤول إليهم الكمبيالة بتظهير لاحق.
- Article 20
Article 20 provides that an endorsement after the due date has the effects of an earlier endorsement, that one after protest for non-payment or after the protest deadline has the effects of an assignment of a right, and that backdating an endorsement is forgery.
التظهير اللاحق لميعاد الاستحقاق يرتب آثار التظهير السابق له، أما التظهير اللاحق لاحتجاج عدم الدفع أو الحاصل بعد انقضاء الميعاد المحدد لعمل هذا الاحتجاج فيرتب آث
- Article 24
Article 24 sets the form of acceptance of a bill of exchange, written on it with the word "accepted" or similar words and signed by the drawee, requires dating the acceptance in certain cases, and lets the holder record an undated acceptance by protest.
يكتب القبول على ذات الكمبيالة ويؤدى بلفظ (مقبول) أو بأية عبارة أخرى تفيد هذا المعنى ويوقعه المسحوب عليه، ويعتبر قبولا مجرد وضع المسحوب عليه توقيعه على صدر الكمب
- Article 27
Article 27 provides that where the drawer designates a place of payment other than the drawee's domicile without naming who is to pay there, the drawee may name that person at acceptance, failing which the acceptor must pay at the place of payment.
إذا عين الساحب في الكمبيالة مكانا للوفاء غير موطن المحسوب عليه دون أن يعين من يجب الوفاء عنده جاز للمسحوب عليه تعيينه عند القبول، فإذا لم يعينه اعتبر القابل ملز
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.