Saudi Arabia: Civil Transactions Law Now in Force

Saudi Arabia News developments

Saudi Arabia: Civil Transactions Law Now in Force

Saudi Gazette, 17 December 2023: The Bureau of Experts at Saudi Arabia’s Cabinet has announced Saudi Arabia Cabinet Decision No. 820/1444 (the Civil Transactions Law) has come into force at courts across the Kingdom.

It has done so 180 days after it was published in the Official Gazette on 19 June 2023.

The Law regulates the provisions of contracts and financial transactions between individuals.

It also governs all civil transactions, unless there is a special law that regulates special transactions.

It covers definitions of natural and legal persons, things, funds, types of right, use of right and obligations in terms of personal rights such as sources of obligation, effects of obligation, descriptions incidental to the obligation, transfer of obligation and expiration of obligation.

It also deals with contracts, including contracts relating to ownership, contracts relating to benefit, contracts relating to work, partnership contracts, and guarantee and insurance contracts.

It details original real property rights and accessory real property rights and clarifies the jurisprudential rules.

It regulates the provisions of contracts and financial transactions in public daily life, such as contracts for sale, rent, and partnerships and sets provisions for compensation for damage in the event of an act by a person causing harm to others, such as damage to property or harm to an individual.

It also specifies the rules for determining the amount of compensation an injured individual is entitled to and outlines the rules and provisions that guarantee creditors the fulfilment of their rights from debtors.

It also balances the interests of creditors and debtors, regulates ownership provisions and clarifies the restrictions that apply to ownership, such as restricting the right of a neighbour not to use their right in a way that harms their neighbour.

It has been issued to promote the stability of transactions, reduce the reasons for invalidating or terminating contracts and expand contractual freedom.

Also reported in Okaz on 17 December 2023. Click here to read more.

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Tanya Jain