Article 43 of the Saudi Commercial Papers Law
المادة 43 من نظام الأوراق التجارية · الفرع الثاني: كيفية الوفاء
Article 43 requires the holder of a bill of exchange to present it for payment on its due date, and treats presenting it to a legally recognized clearing house as presentment for payment.
Official text (Arabic)
This article has not been amended since the law was issued.
على حامل الكمبيالة أن يقدمها للوفاء في يوم استحقاقها، ويعتبر تقديم الكمبيالة إلى إحدى غرف المقاصة المعترف بها نظاما بمثابة تقديم للوفاء.
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 43 explained in plain English
Article 43 sets a basic duty on the holder of a bill of exchange: to present it for payment on its due date. The due date is known according to the type of bill and the way its period is calculated, including what Article 42 provides on adopting the calendar of the country of payment where it differs from that of the country of issue.
The article also makes presentment easier for the holder, providing that presenting the bill to a legally recognized clearing house counts as presentment for payment. Clearing houses are bodies where commercial papers are brought together to be settled, so if the holder presents his or her bill to one, it is as if it was presented to the debtor directly.
After presentment, Article 44 regulates what happens on payment, including the drawee's right to receive the bill signed as paid, and that the holder may not refuse partial payment.
To find the correct due date for a particular bill or the effect of delay in presenting it, it is advisable to consult a lawyer specializing in commercial cases and commercial papers.
Practical example
Abdullah holds a bill of exchange due on the 15th of the month on a company in Dammam. On that day he handed it to a legally recognized clearing house instead of going to the company's premises. Under Article 43, that counts as presenting the bill for payment on its due date.
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 43 of the Saudi Commercial Papers Law
When must a bill of exchange be presented for payment?
The holder must present it for payment on its due date.
Is presenting the bill to a clearing house enough?
Yes, presenting it to a legally recognized clearing house counts as presentment for payment.
What happens after the bill is presented and paid?
Under Article 44, the drawee who paid the bill may ask to receive it from the holder signed as paid.
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.