Commercial Transactions Law · Federal Decree-Law 50 of 2022
Article 89
Book Two: Commercial Obligations and Contracts > Part One: Commercial Obligations
English translation
1. Any instrument for the payment of a sum of money or the delivery of goods may be circulated by way of endorsement if payable to the order of the creditor or by delivery if payable to bearer.
2. The endorsement or delivery shall result in the transfer of all rights arising from the instrument to the endorsee or new bearer.
3. In case of endorsement, the endorser shall guarantee the payment of the right established in the instrument on the maturity date, unless it is agreed in the endorsement wording to restrict the guarantee to the existence of the right at the time of endorsement.
4. Where the instrument is drawn as a result of a commercial transaction, the signatories thereon shall jointly assume the liability, unless the endorsement wording provides for otherwise.
5. In all cases, the debtor may not invoke vis-à-vis the bearer of the instrument the pleas based on personal relationships existing between him and the drawer or the previous bearers, unless the bearer's intent upon receiving the instrument was to cause harm to the debtor, or unless the payment was related to the debtor's lack of capacity.
6. The debtor may also refrain from paying the value of the instrument if such instrument is not delivered to him marked up with clearance.
Official translation, as published by the portal.
Official Arabic text
.1 كل صك يكون محله دفع مبلغ من النقود أو تسليم بضائع يجوز تداوله بطريق التظهير إذا كان لأمر الدائن وبالمناولة إذا كان للحامل.
.2 يترتب على التظهير أو المناولة انتقال جميع الحقوق الناشئة عن الصك إلى المظهر له أو الحامل الجديد.
.3 في حالة التظهير يضمن المظهر الوفاء بالحق الثابت في الصك في ميعاد الاستحقاق ما لم يتفق في صيغة التظهير على قصر الضمان على وجود الحق وقت التظهير.
.4 إذا كان الصك ناشئاً بمناسبة عملية تجارية التزم الموقعون عليه بالتضامن ما لم يتفق على غير ذلك في صيغة التظهير.
.5 في جميع الأحوال لا يجوز للمدين أن يحتج على حامل الصك بالدفوع المبنية على علاقات شخصية تربطه بمنشئ الصك أو حامليه السابقين ما لم يكن قصد الحامل وقت حصوله على الصك الإضرار بالمدين أو كان الدفع يتعلق بنقص أهلية المدين.
.6 يجوز للمدين أن يمتنع عن الوفاء بقيمة الصك إذا لم يسلم إليه مؤشراً عليه بالتخالص.
What it means when you sign
This article covers instruments for paying money or delivering goods. An instrument payable to the order of the creditor can be passed on by endorsement, and one payable to the bearer by handing it over. Passing it on transfers all the rights under the instrument to the new holder. An endorser guarantees payment on the due date, unless the endorsement wording limits the guarantee to the existence of the right at that time. Where the instrument arises from a commercial transaction, the signatories are jointly liable unless the endorsement says otherwise.
Two further rules protect the holder. The debtor cannot raise defences based on personal dealings with the issuer or earlier holders, unless the holder acted to harm the debtor or the defence concerns the debtor's lack of capacity. The debtor may also refuse to pay if the instrument is not handed back marked as settled.
When you are about to sign, this article means that signing or endorsing such an instrument can carry joint liability and a payment guarantee, and that side arguments with the issuer may not be available against a later holder.
Not yet cited in a Fahm report; shown because it sits in the same chapter as one that is.
Related articles
- Article 86This article deals with interest on late payment of commercial debts.
- Article 87This article lets a creditor ask for extra compensation on top of delay interest, but only where the creditor proves that the loss beyond that interest was caused by the debtor's deception or serious error.
- Article 88Cited in Fahm reportsThis article bars a creditor from claiming compound interest, meaning interest charged on interest that has already built up and remains unpaid.
- Article 107This article deals with goods that, once delivered, turn out to differ from what was agreed in quantity or type, or to be defective.
- Article 108Cited in Fahm reportsThis article sets time limits for a buyer who finds that delivered goods differ from the agreement or are defective.
- Article 109This article allows a seller of goods protected by a registered trademark to agree with the buyer that the buyer will not resell below a certain price.