Changes on Implementing Regulations of Execution Law
OVERVIEW
His Excellency the Minister of Justice Circular No. (13/T/8013) was issued on 4/6/1441 AH amending the executive regulations of Execution Law, and the most important amendments are:
First: Removing suspension of the debtor’s electronic services.
Second: Giving the debtor a period of three months before passing a judgment of his imprisonment (obligatory) only if the debt amount or the total debt amounts reach (one million riyals) or more.
Third: The debtor may be released at any time if there are indications that he is serious about settling his financial situation.
Fourth: The limitation of the period of executive detention to a period of three (3) months, renewable according to the judge’s decision after his interrogation.
Fifth: It is not permissible to detain the debtor in the following cases:
If the age of the debtor is (sixty) years or more.
Or if the debtor has minor children and his husband is dead or imprisoned for any reason.
COMMENTS
Because of the aforementioned clarification of the content of the recent amendments to the executive regulations of the implementation system, we recommend and advise our clients to take utmost caution within conducting all dealings with others, especially in financial transactions. We also recommend investigating the accuracy and requesting all supporting documents from others parties to prove their financial capacity, whether they are a natural or legal person. As these documents differ according to the difference between dealing with others.
Based on an extensive study conducted by our lawyers and consultants of the new legal frameworks, we advise our esteemed clients, and before concluding any financial transaction, to examine, verify following documents of other party(s) to your future contracts, for example, but not limited to:
- Valid ID or CR
- Valid Contact Details; e.g. mobile number & email
- Bank statement of the account through which the transaction will be conducted
- National address
- Work address
- Tax number
- Social Insurance Certificate
- Qiwa (Saudization) Certificate
- Zakat Certificate
- Company's balance sheets of the last three (3) years OR the financial status if it is an establishment.
In addition to the above, we would like to share with you the advice of a number of our consultants to take more than one guarantor or sponsors for the person with whom you intend to enter into a financial transaction, if possible. This gives an additional protection layer to your interests and saves you the long term of litigation and debt collection process where you can collect that debt from a guarantor or sponsor of that original debtor if they fail or refrain from payment.
In case of any inquiries regarding any of the above, we hope that you will not hesitate to contact us immediately.