What is the legality of concluding a contract (exchange of currencies), Since the contract is written in English, We present to you a summary of the contract in Arabic that contains its content and the most important provisions contained therein. This is according to the authority’s previous decision regarding contracts written in English. Summary:

1. This type of contract is used in the event that one or two parties need to exchange one currency for another specific currency for the purpose of financing their various operations – the aim of this process is to protect against fluctuations in currency exchange rates.
2. The two parties agree on the amount and in exchange for it in the other currency. As well as the date of its fulfillment, after which each party deposits the agreed amount in the account of the other party.
3. On the agreed-upon fulfillment day, the full amount shall be refunded by each party without any increase or decrease.

Illustrative example:

We will assume that Aayan Company (the first party) will receive an amount of one million US dollars from an external investor, and since Aayan invests in Kuwaiti dinars, She had to convert the amount from the dollar to the dinar.

In this case, the bank (the second party) will provide the amount in Kuwaiti dinars against an agreed exchange rate (for example, 1 million dollars = 300,000 dinars), where notables get 300,000 dinars, while the bank gets one million dollars in return.

The fees that the bank will receive are represented in the difference between the actual exchange rate and the agreed exchange rate. On the agreed-upon fulfillment day (after 6 months / year), 300,000 dinars are returned to the bank, You will receive a million dollars.

Noting that both parties have the right to dispose of the amount borrowed in investment operations and other various activities, However, such amounts shall not be subject to any form of commission, profit or expense, Whether it is in the form of a deduction, a tax, or something else, where the amount must remain fixed – these amounts are always treated as a loan or a liability, not as part of the assets, The benefit of this appears in the event of the bankruptcy of one of the parties or the liquidation of its business.