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Credit Purchase Agreement for United Arab Emirates

Credit Purchase Agreement Template for United Arab Emirates

A comprehensive legal agreement governed by UAE law that establishes the terms and conditions for a credit purchase arrangement between a financial institution and a purchaser. The agreement details the credit facility terms, payment obligations, security arrangements, and compliance requirements under UAE federal laws, including relevant banking regulations and consumer protection provisions. It incorporates specific provisions for interest calculation, payment schedules, and default scenarios while ensuring compliance with UAE Central Bank guidelines and, where applicable, Sharia principles.

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What is a Credit Purchase Agreement?

The Credit Purchase Agreement is a fundamental document used in UAE commercial transactions where goods or services are acquired through credit financing. This agreement is essential when a purchaser requires financing for substantial acquisitions and a financial institution provides credit facilities under UAE law. The document must comply with UAE Federal Law No. 18 of 1993 (Commercial Code), UAE Federal Law No. 14 of 2018 (UAE Central Bank Law), and relevant consumer protection regulations. It typically includes detailed terms about credit limits, payment schedules, security arrangements, and default provisions, while potentially incorporating Sharia-compliant structures when required. The agreement is particularly relevant for business expansions, equipment purchases, or large-scale acquisitions where immediate full payment is not feasible or commercially desirable.

What sections should be included in a Credit Purchase Agreement?

1. Parties: Identification of the parties entering into the agreement, including the credit provider and purchaser

2. Background: Context of the transaction and purpose of the agreement

3. Definitions: Definitions of key terms used throughout the agreement

4. Credit Facility Terms: Details of the credit amount, purpose, and key commercial terms

5. Payment Terms: Schedule of payments, payment method, and calculation of installments

6. Interest and Charges: Applicable interest rates, fees, and other charges

7. Security Arrangements: Details of any security or collateral provided for the credit facility

8. Representations and Warranties: Statements of fact and assurances given by the parties

9. Covenants: Ongoing obligations of the parties during the term of the agreement

10. Events of Default: Circumstances constituting default and consequences

11. Remedies: Rights and remedies available to parties in case of default

12. Term and Termination: Duration of the agreement and termination provisions

13. Governing Law and Jurisdiction: Applicable law and courts having jurisdiction

14. General Provisions: Standard boilerplate clauses including notices, amendments, and assignment

What sections are optional to include in a Credit Purchase Agreement?

1. Sharia Compliance: Required when the agreement needs to comply with Islamic finance principles

2. Insurance: Required when insurance is mandatory for the purchased items or credit facility

3. Guarantees: Include when third-party guarantees are part of the security structure

4. Early Payment Provisions: Terms for early repayment or prepayment of the credit facility

5. Cross-Default: Include when the agreement should be linked to other financial obligations

6. Force Majeure: Include when specific force majeure provisions are required beyond standard UAE law

7. Assignment and Transfer: Detailed provisions when transfer rights are important to either party

8. Anti-Money Laundering: Required for high-value transactions or when dealing with financial institutions

What schedules should be included in a Credit Purchase Agreement?

1. Payment Schedule: Detailed breakdown of payment amounts and due dates

2. Asset Details: Description and specifications of assets being purchased

3. Security Documents: Forms of security documents and guarantees

4. Interest Calculation: Methodology for calculating interest and charges

5. Required Documents: List of documents required from the purchaser

6. Conditions Precedent: List of conditions to be satisfied before drawdown

7. Form of Notices: Standard forms for various notices under the agreement

8. Insurance Requirements: Detailed insurance requirements and specifications

Authors

Alex Denne

Head of Growth (Open Source Law) @ Ƶ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Publisher

Ƶ

Document Type

Sales Agreement

Sector

Sales

Cost

Free to use
Relevant legal definitions
















































Clauses




































Relevant Industries

Banking & Financial Services

Retail

Manufacturing

Automotive

Real Estate

Construction

Industrial Equipment

Technology

Healthcare

Education

Relevant Teams

Legal

Finance

Treasury

Risk Management

Compliance

Procurement

Commercial

Credit Analysis

Corporate Banking

Operations

Relevant Roles

Chief Financial Officer

Finance Director

Credit Manager

Legal Counsel

Commercial Director

Procurement Manager

Treasury Manager

Risk Manager

Compliance Officer

Business Development Manager

Contract Administrator

Financial Controller

Credit Analyst

Corporate Banking Officer

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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