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The Independent Contractor Commission Agreement is essential for businesses operating in Saudi Arabia who engage independent contractors on a commission basis. This document is particularly relevant when companies need to establish clear, legally compliant relationships with external sales agents, representatives, or service providers who are compensated through commission structures. The agreement must align with Saudi Arabian commercial law, including the Commercial Agencies Law and relevant Royal Decrees, while adhering to Shariah principles. It's commonly used in situations where businesses want to expand their market reach without increasing their permanent workforce, requiring careful structuring to avoid employment misclassification while ensuring proper commercial agency compliance. The document typically includes comprehensive provisions for commission calculations, payment terms, performance metrics, and dispute resolution mechanisms specific to the Saudi Arabian legal framework.

1. Parties: Identification of the principal company and the independent contractor

2. Background: Context of the agreement and brief description of the business relationship

3. Definitions: Key terms used throughout the agreement including Commission, Services, Territory, etc.

4. Appointment and Scope: Appointment of contractor and detailed scope of services

5. Independent Contractor Status: Clear establishment of independent contractor relationship and non-employee status

6. Commission Structure: Detailed commission rates, calculation methods and payment terms in compliance with Shariah principles

7. Payment Terms: Payment schedule, currency, method of payment, and handling of expenses

8. Term and Termination: Duration of agreement and circumstances for termination

9. Obligations of Contractor: Specific duties, reporting requirements, and performance standards

10. Obligations of Principal: Support, information, and resources to be provided by the principal

11. Compliance: Compliance with Saudi laws, regulations and Shariah principles

12. Confidentiality: Protection of confidential information and trade secrets

13. Non-Competition: Restrictions on competing activities during and after the agreement

14. Intellectual Property: Ownership and usage rights of intellectual property

15. Dispute Resolution: Process for resolving disputes under Saudi commercial court jurisdiction

16. General Provisions: Standard clauses including notices, amendments, entire agreement, etc.