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RIYADH — The Bureau of Experts at the Saudi Council of Ministers revealed that the Civil Transactions Law has come into force at the courts across the Kingdom 180 days after the date of its publication in the official Umm Al-Qura newspaper on June 19, 2023.
According to the website of the bureau, the law has 124 pages and consists of 720 texts and legal articles that regulate the provisions of contracts and financial transactions between individuals, Okaz/Saudi Gazette has learnt. The law governs all civil transactions, unless there is a special law that regulates special transactions.
According to legal sources, the most prominent objectives of the Civil Transactions Law are to enhance the stability of transactions, reduce the reasons for invalidating or terminating contracts, and expand contractual freedom. The basis of contracts and conditions is validity and permissibility, which is consistent with the rapid development witnessed by the Kingdom, which requires flexibility in creating contracts. One of its goals is to protect individual property, which contributes to increasing economic activity.
The Civil Transactions Law is classified as the largest and most comprehensive law, as it is considered as the reference for regulating the relationship between individuals in their dealings, and it is considered as a major legislative shift in the history of the Saudi judiciary.
The law covers introductory sections for implementing the law and 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 named contracts, including contracts relating to ownership, contracts relating to benefit, contracts relating to work, as well as partnership contracts, and contracts of guarantee and insurance. The law details original real property rights and accessory real property rights and clarifies the jurisprudential rules.
The major components of the Civil Transactions Law include regulating the provisions of contracts and financial transactions in public daily life, such as contracts for sale, rent, and partnerships, setting 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 oneself. It also include stating the rules that determine the amount of compensation to which the injured person is entitled, setting rules and provisions that guarantee creditors the fulfillment of their rights from debtors, balancing the interests of creditors and those of debtors, regulating ownership provisions, and clarifying the restrictions that apply to ownership, such as restricting the right of a neighbor not to use his right in a way that harms his neighbor.
According to specialists, the Civil Transactions Law represents a major qualitative shift in civil transactions, and is considered as the reference for all civil and commercial transactions covered by current systems. It comes as a continuation of the system of legislation announced by Crown Prince and Prime Minister Mohammed bin Salman, from which the Personal Status Law was issued.
The Civil Transactions Law is a practical translation of the efforts led and supervised by the Crown Prince in developing and reforming systems that preserve rights, establish the principles of justice and transparency, and achieve comprehensive development in a way that enhances the stability of judicial rulings and increases the predictability of rulings.
