Article 24 of the Saudi Law on Security Rights in Movable Assets

This article gives the secured party a practical power at the enforcement stage: to take the steps needed to:

• Repair the collateral.
• Improve it.
• Prepare it for sale.

Why this provision? At enforcement the collateral may be in a condition that reduces its price, such as broken equipment or goods that need packaging. Repairing or preparing it raises its value on sale, which helps the secured party recover his right and may also help the grantor if a surplus remains from the proceeds.

Relation to the neighboring articles:

• Article 23, before it, regulates non-judicial enforcement against the collateral by selling it at public auction or directly, or taking ownership of it, under a written agreement made before breach and procedures set by the Implementing Regulations.
• Article 25, after it, provides that judicial or non-judicial enforcement clears the collateral of the rights attached to it.

The wording of the article is unqualified and names no particular stage, but it appears in the chapter on enforcement against the collateral, which ties it to preparing the collateral for sale on enforcement. The article does not specify the kind of steps or limit their cost, so they should be "necessary" for repair, improvement or preparation for sale as it provides.

If you are a grantor who believes the steps taken on your collateral are unnecessary, or a creditor who wants to take them, it is advisable to consult a lawyer specialized in commercial and finance matters.