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A Service Contract sets out the terms between a service provider and their client in Saudi Arabia, spelling out exactly what services will be delivered, how much they'll cost, and when they'll be completed. These agreements are especially common in construction, IT, and facilities management sectors across the Kingdom.

Under Saudi commercial law, a proper Service Contract must include clear payment schedules, quality standards, and dispute resolution methods aligned with Shariah principles. It protects both parties by defining their rights and obligations, including essential details like service scope, performance metrics, and termination conditions that comply with local labor regulations.

Use a Service Contract when hiring external providers for significant business services in Saudi Arabia, particularly for ongoing arrangements like facility maintenance, IT support, or professional consulting. These contracts become essential when the service value exceeds SAR 500,000 or involves critical business operations that need clear performance standards.

The agreement proves especially valuable during service disputes, regulatory audits, or Zakat Authority reviews. For government contracts or projects requiring Saudi labor quotas, a properly structured Service Contract helps demonstrate compliance with Saudization requirements and local commercial regulations while protecting both parties' interests through Shariah-compliant terms.

• Plumbing Contract: Specialized for maintenance and installation services, with detailed specifications for materials and workmanship standards
• Works Contract: Broader scope for construction and infrastructure projects, including milestone-based payments and project completion terms
• Security Contract: Focuses on physical security services with specific liability provisions and personnel requirements
• Prime Contract: Used for major projects with subcontractor management provisions and complex delivery schedules
• Service Of Work Contract: General-purpose agreement for professional services, adaptable across various industries

• Service Providers: Companies or professionals who deliver specialized services, from maintenance contractors to IT consultants, must ensure their Service Contracts align with Saudi commercial regulations
• Corporate Clients: Organizations receiving services, including government entities and private companies, who specify requirements and performance standards
• Legal Departments: In-house counsel or external law firms who draft and review agreements to ensure Shariah compliance
• Procurement Teams: Staff who manage vendor selection and contract negotiations, ensuring alignment with organizational policies
• Compliance Officers: Professionals who monitor contract execution and verify adherence to Saudization requirements and local regulations

• Service Details: Document precise scope, deliverables, timelines, and quality standards expected from the service provider
• Party Information: Gather complete legal names, commercial registration numbers, and authorized signatories of both parties
• Pricing Structure: Define payment terms, schedules, and any performance-linked bonuses or penalties
• Compliance Requirements: Confirm Saudization quotas, necessary permits, and relevant industry regulations
• Risk Management: Outline liability limits, insurance requirements, and Shariah-compliant dispute resolution mechanisms
• Template Selection: Use our platform's Saudi-specific templates to ensure all mandatory elements are included correctly

• Party Identification: Full legal names, commercial registration numbers, and authorized representative details
• Service Description: Detailed scope of work, performance standards, and delivery timelines aligned with Saudi commercial law
• Financial Terms: Clear payment schedules, currency, and Shariah-compliant late payment penalties
• Duration Clause: Contract period, renewal terms, and conditions for early termination
• Compliance Section: References to relevant Saudi regulations, Saudization requirements, and necessary permits
• Dispute Resolution: Shariah-compliant arbitration procedures and governing law provisions
• Signature Block: Official company stamps, authorized signatories, and witness requirements per Saudi law

A Service Contract differs significantly from a Master Service Agreement in several key ways under Saudi law. While both deal with service delivery, they serve distinct purposes in business relationships.

• Scope and Duration: Service Contracts typically cover specific, defined services with clear start and end dates, while Master Service Agreements establish long-term framework terms for multiple future services
• Level of Detail: Service Contracts include detailed specifications, deliverables, and pricing for particular services, whereas MSAs outline general terms that apply to subsequent work orders
• Implementation: Service Contracts take effect immediately upon signing, while MSAs require additional service orders or statements of work to initiate specific services
• Flexibility: MSAs provide more adaptability for changing service needs without renegotiation, while Service Contracts have fixed terms that typically require formal amendments to modify