Article 58 of the Saudi Government Tenders and Procurement Law
المادة 58 من نظام المنافسات والمشتريات الحكومية · الفصل الأول: صياغة العقود ومدد تنفيذها
The Article allows government contracts to include clauses on transferring knowledge, training and operating skills to the employees of government entities.
Official text (Arabic)
This article has not been amended since the law was issued.
يجوز تضمين العقود بنوداً تتعلق بنقل المعرفة والتدريب ومهارات التشغيل إلى موظفي الجهات الحكومية.
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 58 explained in plain English
This Article opens the door for government entities to benefit from their contracts beyond obtaining the goods or service, in that contracts may include clauses on three matters:
- Transfer of knowledge.
- Training.
- Operating skills.
The beneficiaries of these clauses under the text are the employees of government entities.
Note the following:
- The provision is permissive ("may"), so not every contract is bound to include these clauses, and it is for the entity to decide what suits the nature of the contract.
- If the contract includes these clauses, they become part of the contractor's obligations, so he must perform them like the other terms of the contract.
- The Article does not set the form or duration of the training or the number of trainees; these are set in the contract itself.
The practical benefit is that the government entity does not remain dependent on the contractor to operate what it bought, and its employees acquire the ability to do so. For example, a contract to supply a technical system may include training the entity's employees to operate it.
This Article relates to Article 57, which refers to the Regulations the determination of the types of contracts, and to Article 59, which provides for drawing up the contract between the entity and the winning bidder after he is notified of the award decision and submits the final guarantee letter.
Before signing a contract that includes training and knowledge-transfer obligations, it is wise to review their wording with a lawyer who specializes in administrative cases and government contracts.
Practical example
A government entity in Riyadh contracted with a company to supply specialized laboratory equipment, and the contract included a clause requiring the company to train a number of the entity's employees to operate the equipment and carry out its basic maintenance, so the training became part of its contractual obligations.
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 58 of the Saudi Government Tenders and Procurement Law
May a government contract include staff training?
Yes. Contracts may include clauses on transferring knowledge, training and operating skills to the employees of government entities.
Is a knowledge-transfer clause mandatory in every government contract?
No. The text makes it permissible, not mandatory.
Who benefits from the knowledge-transfer clauses?
The employees of government entities, under the text of the Article.
More articles on Concluding the Government Contract and the Final Guarantee
- Article 55
The Article requires government contracts and their documents to be drafted in Arabic, allows another language alongside it with Arabic governing, and allows correspondence alone to suffice if the contract value does not exceed SAR 300,000.
1- تُصاغ العقود ووثائقها وملحقاتها باللغة العربية، ويجوز استخدام لغة أخرى إلى جانب العربية على أن تكون العربية هي المعتمَدة في تفسير العقد وتنفيذه وتحديد مواصفا
- Article 56
The Article caps continuing service contracts at five years unless the Ministry approves more, requires the term to fit the work, and requires performance and evaluation conditions allowing termination or reduced payments.
1- لا تتجاوز مدة عقود الخدمات ذات التنفيذ المستمر، كالصيانة والنظافة والتشغيل والإعاشة، (خمس) سنوات، وتجوز زيادتها في العقود التي تتطلب طبيعتها ذلك؛ بعد موافقة
- Article 57
The Article refers to the Implementing Regulations the determination of the types of contracts that government entities may use.
تحدد اللائحة أنواع العقود التي يجوز للجهات الحكومية استخدامها.
- Article 59
The contract is drawn up with the winning bidder after he is notified of the award and submits the final guarantee letter, and in public construction contracts the contractor must be enabled to start within 60 days unless the documents say otherwise.
1- يحرر العقد بين الجهة الحكومية وصاحب العرض الفائز بعد إبلاغه بقرار الترسية وتقديم خطاب الضمان النهائي. 2- يُمكّن المتعاقد معه في عقود الإنشاءات العامة من البد
- Article 60
The Article requires government entities to submit the contracts specified by the Regulations to the Ministry of Finance for review before signing; the Ministry reviews them within 15 working days or they are deemed approved.
1- تلتزم الجهات الحكومية بعرض عقودها -التي تحددها اللائحة- على الوزارة لمراجعتها قبل توقيعها، وعلى الوزارة مراجعة تلك العقود خلال (خمسة عشر) يوم عمل من تاريخ ور
- Article 61
The Article requires the winning bidder to submit a final guarantee of 5% of the contract value within 15 working days, and explains the consequence of delay, the cases exempt from it and how long it is kept.
1- يجب على من تتم الترسية عليه تقديم ضمان نهائي بنسبة (5%) من قيمة العقد، وذلك خلال (خمسة عشر) يوم عمل من تاريخ إبلاغه بالترسية. ويجوز للجهة الحكومية تمديد هذه
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.