In the Middle East, a contract is never “just a contract.”
It is a blend of law, custom, regulation, and business culture—especially in markets like Saudi Arabia, the UAE, Egypt, Qatar, Kuwait, Bahrain, Oman, and Jordan. Companies that treat contracts as simple forms or generic templates often face surprises later: unpaid invoices, broken commitments, jurisdiction issues, or unenforceable clauses.
For businesses working across the region, understanding the specific contexts and procedures of contract drafting in the Middle East is critical—both for local operations and cross-border deals. This is exactly where specialized legal support becomes essential.
In this article, we’ll walk through:
- What makes Middle Eastern markets unique from a contract-drafting perspective
- Key procedures and steps to follow when drafting contracts in the region
- Practical regional nuances (Saudi, Egyptian, GCC context)
- How specialized firms like B2B help companies draft contracts that actually work in practice, not just on paper
Why Contract Drafting in the Middle East Is Not “One Size Fits All”
The Middle East is not a single legal system. It is a patchwork of:
- Civil law systems (like Egypt, Jordan)
- Mixed systems with civil law + Sharia principles (like Saudi Arabia, UAE, Qatar, Kuwait)
- Different levels of court modernization and arbitration acceptance
- Diverse business cultures—from highly formal to relationship-driven
Some practical implications:
- In Saudi Arabia, recent codifications (like the Civil Transactions Law) have given more structure to contract rules, but Sharia-based principles still underpin important areas like interest, penalties, and compensation.
- In Egypt, the Civil Code and longstanding judicial practice are very influential, and courts pay close attention to wording and intent.
- In GCC countries generally, arbitration and commercial courts have become more active, especially in cross-border contracts.
Because of this diversity, a contract drafted for “the Middle East in general” is often too vague or risky. Companies need documents tailored to the specific country and sector.
Core Procedural Steps for Drafting Contracts in the Middle East
While every deal is unique, there is a practical, repeatable workflow that any serious business should follow in the region.
Step 1: Clarify the Commercial Reality Before the Legal Text
Before writing any clause, you need clarity on:
- Who exactly are the parties? (local entity, branch, holding company?)
- Where are the services/products delivered?
- Where are payments made?
- Which country’s courts or arbitration centers are realistic for dispute resolution?
- Are there any regulatory approvals, licenses, or sector-specific rules involved (e.g., in health, telecom, financial services)?
In the Middle East, especially for cross-border deals, these questions strongly affect governing law, jurisdiction, tax, and enforcement.
At B2B, we almost always start with a commercial briefing from the client before touching the actual contract text. That saves a lot of time—and prevents drafting a “legally perfect” contract that simply doesn’t fit the reality of the deal.
Step 2: Choose the Governing Law and Dispute Resolution Method Early
One of the most sensitive issues in regional contracts is which law applies, and where disputes will be resolved.
Typical options include:
- Local courts (e.g., Riyadh, Jeddah, Cairo)
- Regional arbitration centers (e.g., SCCA in Saudi Arabia, CRCICA in Cairo, DIFC-LCIA or ADGM in the UAE)
- International arbitration rules (e.g., ICC, LCIA)
In many Middle Eastern contracts, a common mistake is leaving these points vague (“the competent court”, “applicable law” with no specification). That can result in years of procedural arguments before anyone even reaches the actual dispute.
A sound procedure is:
- Agree commercially (even in principle) with the other party on law and forum.
- Reflect that clearly in a dedicated clause.
- Ensure that clause is compatible with each side’s local laws and policy (some sectors or contracts may have mandatory local jurisdiction rules).
Step 3: Align the Contract With Local Legal Restrictions
Certain clauses might seem normal in other regions but need special attention here:
- Interest and late-payment penalties
- In some jurisdictions, conventional interest is restricted or handled under the concept of compensation rather than pure interest.
- Liquidated damages
- Some courts will enforce them if they are reasonable and proportionate; others may reduce them.
- Exclusivity and competition
- Distribution or agency agreements may trigger local competition or commercial agency laws.
- Employment-like arrangements
- Mislabeling employees as “consultants” can cause legal exposure.
A well-structured procedure always includes a local-law screening phase: adjusting the wording so the contract doesn’t collide with mandatory rules in Saudi, Egyptian, or GCC law.
Step 4: Draft Clear, Detailed Commercial Clauses
Middle Eastern courts and arbitrators, like courts everywhere, prefer clarity over assumptions. But in practice, the region often sees contracts with vague phrases such as “as agreed between the parties later” or “according to market practice”.
For strong, region-ready contracts, the drafting should:
- Define services or products precisely (specs, quantities, KPIs, SLAs)
- Include step-by-step acceptance and delivery procedures
- Set payment terms that are clear and measurable (dates, events that trigger invoices, documentation required)
- Reflect how people actually work in the region (e.g., part payments, advances, letters of guarantee, etc.)
For example, in many Saudi and Egyptian B2B sectors, companies rely heavily on:
- Advance payments
- Bank guarantees
- Post-dated cheques
A specialized regional contract should integrate these tools in a way that is both legal and practical.
Step 5: Build Evidence and Documentation Into the Contract
In debt collection and commercial litigation across the region, one issue appears again and again: lack of proper documentation.
A good Middle Eastern contract typically includes:
- Requirements for signed delivery notes, electronic confirmations, or system logs
- Obligations to issue and accept invoices within specific timeframes
- Defined communication channels (e.g., registered email domains, e-portals, or official letters)
- Record-keeping obligations
This is not just good practice; it often decides who wins in court or arbitration.
At B2B, because we handle debt collection as well as drafting, we always design contracts with future evidence in mind—so if the relationship goes wrong, the contract helps our client rather than becoming a burden.
Step 6: Address Language, Bilingual Texts, and Translation
In the Middle East, especially for deals involving foreign parties, contracts are often drafted in both Arabic and English.
Key procedural decisions include:
- Which language prevails in case of conflict?
- Who prepares the official translation?
- Will local courts require an Arabic version? (often yes in Saudi and Egypt)
Best practice:
- Specify a “controlling language” in the contract.
- Use professional legal translators for bilingual versions.
- Avoid “quick translation” that changes meaning between the two texts.
Step 7: Account for Cultural and Relationship-Based Factors
In many Middle Eastern markets, relationships matter. Negotiations may be soft on the surface but strict in expectations. It’s common to hear “Don’t worry, we trust each other”—right before a dispute triggered by unclear wording.
Professional contract procedure in the region must balance:
- Respectful, flexible negotiation
- With firm, written clarity in the final document
A polite relationship does not replace a strong contract. The best companies insist on both.
Special Contexts in Key Middle Eastern Markets
Saudi Arabia
- Modernizing legal framework (including civil transactions and commercial courts).
- Strong emphasis on written contracts for corporate and government-related projects.
- Growing reliance on arbitration and recognized centers like SCCA.
- Sensitivity around interest/compensation terms and Sharia-based principles.
Egypt
- Long history of civil law jurisprudence; courts pay close attention to wording and intent.
- Strong use of written evidence, especially invoices, delivery notes, and correspondence.
- Popular use of CRCICA and other arbitration forums for large contracts.
- Very active B2B environment with credit-based dealings—making payment clauses crucial.
GCC (UAE, Qatar, Kuwait, Bahrain, Oman)
- Many free zones and international arbitration hubs.
- Heavy use of English-language contracts, especially with multinational companies.
- Major role for international standards, especially in construction, logistics, and energy.
Each of these environments requires small but critical adjustments in drafting if you want your contract to stand up in practice.
A Short Anecdote: When Procedure Made All the Difference
A regional trading company operating between Saudi Arabia and Egypt had a standard “one-page contract” they used for all clients. There was no governing law, no clear dispute forum, weak payment terms, and no delivery documentation requirements.
After several unpaid invoices, they came to B2B.
We didn’t just draft “a better contract.” Instead, we helped them redesign their entire contract procedure:
- Structured bilingual contracts with clear governing law and arbitration
- Strong payment milestones and late-payment mechanisms
- Mandatory delivery confirmations (digital and physical)
- Clear documentation and notification steps
Within a year, not only did disputes decrease sharply—their average collection time improved, and their negotiating position with new clients became noticeably stronger.
Sometimes, it’s not only the clauses that matter, but the systematic way contracts are drafted and used.
How B2B Supports Companies With Regional Contract Drafting
As a law firm focused on commercial contracts and debt collection, B2B offers region-specific expertise for the Middle East market. Our value is not theoretical; it’s based on what actually happens when contracts are tested in disputes, collection efforts, and negotiations.
We help clients with:
- Drafting and reviewing contracts for Saudi, Egyptian, and wider GCC environments
- Setting internal procedures for contract approval, signing, and documentation
- Adapting international templates to fit regional laws and practices
- Designing contracts that support future debt collection and enforcement
- Creating bilingual Arabic–English agreements with clear controlling language
- Advising on governing law, arbitration, and jurisdiction choices suited to each deal
Conclusion: In the Middle East, Strong Procedures Create Strong Contracts
Contract drafting in the Middle East is not just about language on a page. It is about:
- Understanding local legal systems
- Respecting regional business culture
- Anticipating enforcement and collection issues
- Building documentation and clarity into every step
Companies that treat contracts as strategic tools—backed by solid procedures and specialized legal support—are the ones that avoid costly disputes and protect their cash flow.If your company operates in the Middle East and wants contracts that truly match the region’s legal and commercial realities, contact B2B for a confidential consultation.
We help you design and implement contract-drafting procedures that protect your business across the region, deal after deal.
