# What Is the Official Supply Contract in Saudi Arabia and What Are Its Main Clauses?

The **Supply Contract** is one of the core contract templates approved by the Etimad platform. It governs the relationship between a supplier and a government entity in the context of goods procurement. For a full breakdown, refer to [our dedicated article on the Etimad Supply Contract PDF](https://tendersalerts.com/articles/etimad-supply-contract-template-pdf).

## When Should the Supply Contract Be Used?

- When the goal of the agreement is **purchasing goods**—not services or construction.
- Examples include: medical supplies, IT hardware, furniture, office materials.
- The contract does **not cover** ongoing service obligations like operations or maintenance.

## What Are the Key Clauses in the Contract?

### 1. **Contract Duration**

- Specified in days or months from the signing date.
- May be extended under valid and documented circumstances.

### 2. **Contract Value & Payment Terms**

- The total value is listed including VAT.
- Payment may be in a lump sum or multiple stages.
- Requires official invoice and performance certificate for disbursement.

### 3. **Warranty**

- Minimum of **12 months** from final delivery date.
- The supplier is responsible for repairing or replacing defective goods.

### 4. **Penalties**

- **1% per week** delay penalty, capped at 6% of the contract value.
- Additional penalties may apply for non-conformity or incomplete delivery.

### 5. **Modifications**

- Quantities or technical specifications may be modified by mutual agreement.
- All changes must be formally documented and signed.

### 6. **Termination**

- The government has the right to terminate the contract if the supplier breaches terms or fails to deliver on time.

## How Is It Different from Other Contract Types?

- **Supply Contract** = procurement of ready-to-deliver goods.
- **Construction Contract** = phased delivery of physical work or infrastructure.
- **Operations & Maintenance Contract** = long-term service delivery with KPIs and evaluations.

## Can the Template Be Customized?

Yes, but with conditions:

- Official agreement between both parties.
- Documented through formal annexes.
- Must remain compliant with the Government Tenders and Procurement Law.

## Conclusion

The official Supply Contract is a robust legal tool that protects both government entities and suppliers. Understanding its key clauses ensures smoother procurement processes, fewer disputes, and full regulatory compliance.

🔗 Learn more and download the template from [this article](https://tendersalerts.com/articles/etimad-supply-contract-template-pdf).