MANDATORY TERMINATION OF ADMINISTRATIVE CONTRACTS DUE TO INSOLVENCY IN LIGHT OF THE SAUDI GOVERNMENT TENDERS AND PROCUREMENT LAW

Abstract

This study examines the mandatory termination of administrative contracts for insolvency in light of the Saudi Government Tenders and Procurement Law (GTPL). Adopting an analytical method, the paper is structured into an introduction, two chapters, and a conclusion. Its one context defines the core terms; and other context analyzes the legal nature of mandatory termination for insolvency and its conditions. The study concludes, inter alia, that the insolvency of the contractor, triggering contract termination - must be established by a final court judgment, as evidenced by the Saudi legislator’s phrase (insolvency is established), and that the administration’s power to terminate in this case is a constrained (bound) power. Recommendations include distinguishing between termination that is penal (where the contractor’s fault, fraud, or deceit is present) and termination justified by public interest (where insolvency arises without the contractor’s fault). (GTPL, Royal Decree No. M/128, 13/11/1440; Implementing Regulations, Ministerial Decision No. 3479, 11/08/1441).