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A Referral Agreement sets up a formal business relationship where one party gets rewarded for directing clients or customers to another party. In Saudi Arabia, these agreements help businesses expand their reach while following Shariah-compliant compensation structures and the Kingdom's commercial regulations.

The agreement spells out key details like referral fees, payment terms, and how long the arrangement lasts. It protects both parties by clearly defining their roles, establishing quality standards for referrals, and ensuring compliance with Saudi Ministry of Commerce guidelines on business partnerships and commission-based arrangements.

Use a Referral Agreement when building business partnerships in Saudi Arabia that involve directing customers or clients to another company for a fee. This is especially important for professional service firms, real estate agencies, and financial institutions operating under the Kingdom's strict financial regulations and Shariah principles.

These agreements become essential when expanding your client base through partner networks, particularly if you're handling sensitive customer data or substantial commission structures. Having clear terms protects both parties from disputes, ensures compliance with Saudi commercial laws, and creates a professional framework for tracking referrals and managing payments.

• Finders Fee Contract: A performance-based variation focused on one-time rewards for successful introductions, commonly used in real estate and investment sectors under Saudi commercial law.
• Ongoing Commission Agreement: Establishes long-term referral relationships with recurring payments, typically used by professional service providers and consultants.
• Lead Generation Agreement: Focuses specifically on digital marketing and online customer acquisitions, with detailed tracking mechanisms and Shariah-compliant payment structures.
• Professional Services Referral: Tailored for regulated industries like healthcare and legal services, including specific compliance requirements and professional standards.

• Business Owners: Primary parties who establish referral networks and define commission structures, ensuring compliance with Saudi commercial regulations.
• Professional Service Providers: Lawyers, consultants, and financial advisors who both draft agreements and participate in referral networks under Ministry of Commerce guidelines.
• Sales Representatives: Field agents who actively generate leads and earn commissions through Shariah-compliant referral arrangements.
• Legal Departments: In-house counsel who review and customize agreements to protect company interests and ensure regulatory compliance.
• Compliance Officers: Professionals who monitor referral activities and maintain documentation for Saudi regulatory requirements.

• Basic Information: Gather complete legal names, commercial registration numbers, and authorized representatives of all parties involved.
• Referral Terms: Define clear criteria for qualified referrals, including minimum requirements and any exclusions under Saudi law.
• Commission Structure: Outline Shariah-compliant payment terms, rates, and conditions for earning referral fees.
• Duration Details: Specify agreement length, renewal options, and termination conditions aligned with local contract practices.
• Compliance Check: Our platform ensures your agreement includes all mandatory elements required by Saudi commercial regulations, minimizing legal risks.
• Approval Process: Identify key stakeholders who need to review and sign the agreement within your organization.

• Party Details: Full legal names, commercial registration numbers, and authorized signatories of all parties involved.
• Scope Definition: Clear description of referral services and qualifying criteria under Shariah principles.
• Commission Terms: Detailed payment structure, calculation methods, and timing aligned with Saudi banking regulations.
• Confidentiality: Protection of business information and client data according to Saudi data protection laws.
• Duration Clause: Agreement term, renewal conditions, and termination rights under local contract law.
• Governing Law: Explicit reference to Saudi Arabian law and jurisdiction for dispute resolution.
• Compliance Statement: Confirmation of adherence to Ministry of Commerce regulations and Shariah principles.

A Referral Agreement differs significantly from an Agency Agreement in several key aspects under Saudi law. While both involve business relationships, their scope and legal implications vary considerably.

• Legal Authority: Agency Agreements grant the agent power to act on behalf of the principal, while Referral Agreements only permit introducing potential clients without negotiation authority.
• Liability Scope: Agents bear direct responsibility for transactions under Saudi commercial law, whereas referral partners are only accountable for the quality of their introductions.
• Payment Structure: Agency relationships typically involve ongoing commission structures with broader responsibilities, while referral fees are usually one-time payments for successful introductions.
• Regulatory Requirements: Agency Agreements must comply with strict Saudi Agency Law regulations and registration requirements; Referral Agreements face lighter regulatory oversight.