Saudi Civil Transactions Law (Royal Decree No. M/191 of 2023)

المادة 1

1. The provisions of this Law shall apply to all matters addressed thereby in letter and spirit. In cases where none of the provisions of this Law can be applied, the General Rules provided for in the Concluding Provisions shall apply, and in the absence of a relevant general rule, the provisions derived from Sharia that are most consistent with this Law shall apply. 2. The application of the provisions of this Law shall not prejudice any specific legal provision.

المادة 2

All periods and deadlines provided for in this Law shall be calculated according to the Hijri calendar.

المادة 3

1. The legal personality of a human being shall commence from the time he is born alive and shall end upon his death. 2. The rights of an unborn child shall be determined by legal provisions.

المادة 4

Missing and absent persons and persons of unknown parentage shall be subject to the legal provisions related thereto.

المادة 5

The names, surnames, families, relatives, and nationalities of persons shall be subject to the legal provisions related thereto.

المادة 6

1. Lineal kinship is the relationship between ascendants and descendants. 2. Collateral kinship is the relationship between persons of a common ancestry without being descendants of one another.

المادة 7

1. In determining the degree of lineal kinship, each generation of descendants up to the ancestor shall be counted as a degree without counting such ancestor. As for collateral kinship, the degree of kinship shall be counted by the number of generations of descendants upwards from one descendant to the common ancestor and then downwards from the common ancestor to the other descendant. Each generation of descendants, excluding the common ancestor, shall be counted as a degree of kinship. 2. The relatives of a spouse shall be considered of the same type and degree of kinship in relation to the other spouse.

المادة 8

A person’s domicile shall refer to his place of habitual residence. A person may have more than one domicile at the same time. In the absence of a habitual residence, the place where the person is currently located shall be deemed his domicile; if the person’s current place is unknown, the last known place where he was located shall be deemed his domicile.

المادة 9

The place where a person practices a trade or profession shall be deemed his domicile with regard to the management of such trade or profession.

المادة 10

The domicile of a fully or partially incompetent person, or a missing or absent person shall be deemed the domicile of his legal representative. A partially incompetent person may have his own domicile with regard to dispositions he has the legal capacity to perform.

المادة 11

1. A person may elect a domicile for a certain act; the elected domicile shall be the domicile of all matters relating to such act, unless it is explicitly restricted to certain acts to the exclusion of others. 2. An elected domicile may be established only in writing.

المادة 12

1. A fully competent person is a person who has reached the age of majority, has full mental capacity, and has not been interdicted. 2. The age of majority shall be 18 years according to the Hijri calendar.

المادة 13

1. An incompetent person is a person who is non-discerning due to young age or idiocy. 2. A person under the age of seven shall be deemed a non-discerning person.

المادة 14

Partially incompetent persons are: a) A minor who has reached the age of discernment but has not reached the age of majority. b) A lunatic: a person who is deficient in reason but has not reached the point of idiocy. c) A person interdicted for being a spendthrift or for being imprudent.

المادة 15

Fully or partially incompetent persons shall be subject to the legal provisions governing guardianship or trusteeship, as the case may be.

المادة 16

No person may waive his competency or modify its provisions.

المادة 17

Legal persons are: a) The State. b) Public agencies and institutions and entities that are granted legal personality pursuant to legal provisions. c) Endowments. d) Companies that are granted legal personality pursuant to legal provisions. e) Civil and cooperative associations and civil organizations that are granted legal personality pursuant to legal provisions. f) Any entity that is granted legal personality pursuant to legal provisions.

المادة 18

1. A legal person shall, within the limits prescribed by law, enjoy all rights, except for the rights inherent to a natural person. 2. A legal person shall have the following: a) Independent financial capacity. b) Legal capacity within the limits specified in the document establishing it or as specified in legal provisions. c) The right to litigation. d) An independent domicile. Such domicile shall be the place where its main office is located; however, the place where a legal person’s branch is located may be deemed a domicile thereof with respect to the activity of such branch. e) A nationality, subject to legal provisions. 3. A legal person shall have a representative to express its will.

المادة 19

Any material or non-material thing may be deemed the subject of financial rights, except for things that cannot be possessed due to their nature or things which are prohibited from being the subject of financial rights pursuant to legal provisions.

المادة 20

Property is anything that has a non-negligible material value in dealings, whether it is an asset, usufruct, or right.

المادة 21

1. Fungibles are things the individual units of which are identical or similar enough to become interchangeable upon the performance of an obligation without any difference considered significant according to custom. 2. Non-fungibles are things the individual units of which differ significantly in characteristics or value and such difference is considered significant according to custom or things the equivalents of which are rarely circulated.

المادة 22

1. A real property is a fixed thing that cannot be moved without damaging it or altering its form; any other thing shall be deemed movable. 2. A movable property shall be deemed immovable by destination if the owner of such property places it in a real property owned thereby for the purpose of serving or utilizing the real property on a permanent basis, even if it is not permanently attached thereto.

المادة 23

Consumables are things which, depending on the purpose for which they were prepared, are either consumed or expended. Things intended for sale in commercial stores shall be deemed consumables.

المادة 24

Public property shall be subject to the legal provisions related thereto.

المادة 25

Financial rights are either in personam or in rem.

المادة 26

1. A right in rem is either original or ancillary. 2. Original rights in rem are the rights of ownership, usufruct, use, habitation, easement, and endowment as well as any other right deemed as such pursuant to legal provisions. 3. Ancillary rights in rem are the rights of pledge and priority rights as well as any other right deemed as such pursuant to legal provisions.

المادة 27

Rights associated with non-material things shall be subject to the legal provisions related thereto.

المادة 28

A person who lawfully exercises his right shall not be liable for any harm arising therefrom.

المادة 29

1. A person may not exercise his right in an abusive manner. 2. A person’s exercise of his right shall be deemed abusive in the following cases: a) If the right is exercised only to harm others. b) If the benefit of exercising the right is substantially disproportionate to the harm it causes to others. c) If the right is exercised unlawfully or for other than the intended purpose.

المادة 30

The provisions of this Section shall apply to nominate and innominate contracts, without prejudice to the legal provisions governing specific contracts.

المادة 31

A contract is concluded by the concurrence of an offer and acceptance to create a legal effect, subject to the legal provisions governing the conclusion of contracts. Subsection 1: Elements of Contract First: Consent

المادة 32

Consent is attained when the mutual intent of two or more parties who have the legal capacity to conclude contracts is expressed by any means indicating such intent. 1. Expression of Intent

المادة 33

1. Offer and acceptance shall be expressed by any means indicating intent. 2. Intent may be expressed verbally, in writing, by a discernible sign, or by exchange, and it may be expressed explicitly or implicitly, unless otherwise required by legal provisions, agreement, or the nature of the dealing.

المادة 34

1. The display of goods and services and the indication of their prices shall be deemed an offer, unless proven otherwise. 2. An advertisement indicating prices shall not be deemed an offer, unless evidence that it is intended as an offer exists.

المادة 35

1. The offeror may withdraw his offer before an acceptance is made, unless such offer is for a specified period. 2. If the offer is not for a specified period and the offeror withdraws his offer, the offeror shall notify the offeree of the withdrawal; otherwise, he shall compensate the offeree for any harm he sustains. Such compensation shall not include any loss of expected gain from the contract from which he withdraws.

المادة 36

1. An offer shall expire in the following cases: a) If the offeror withdraws the offer in accordance with the provisions of Article 35 of this Law. b) If the offeree rejects the offer explicitly or implicitly. Any modification to the acceptance shall be deemed a rejection constituting a new offer. c) If the offeror or the offeree dies, or if either of them loses his capacity before the acceptance is made, even if the offer is for a specified period. d) If the acceptance does not meet the offer according to custom, or if the period specified by the offeror for acceptance lapses without an acceptance. 2. If the acceptance is made after the expiration of the offer. In such case, the contract shall not be deemed concluded, and said acceptance shall be deemed a new offer.

المادة 37

1. The silence of the offeree shall not be deemed an acceptance, unless an agreement or presumptive evidence indicating acceptance exists. 2. Silence shall be deemed an acceptance if the contracting parties had a prior dealing and the offer relates to such dealing, or if the offer is for the sole benefit of the offeree.

المادة 38

1. If the contracting parties are in the same place or are in two different places communicating through live communication means, the contract shall be deemed concluded at the time and place where the acceptance is made, unless agreed otherwise. 2. If the contracting parties are not in each other’s presence, the contract shall be deemed concluded at the time and place where the offeror becomes aware of the acceptance, unless agreed otherwise.

المادة 39

Without prejudice to legal provisions, a contract shall not be concluded at auction except after the bid is awarded. A bid is canceled when a higher bid is made, even if the higher bid is subsequently void, or if the auction closes without a bid being awarded.

المادة 40

Acceptance in adhesion contracts shall be deemed made upon the acknowledgment of the offeror’s non-negotiable conditions.

المادة 41

1. If a contract is negotiated, such negotiation shall not result in an obligation to conclude the contract. However, a party that negotiates or terminates the negotiation in bad faith shall be liable for any harm incurred by the other party; such liability shall not include compensation for any loss of expected gain from the contract subject of the negotiation. 2. The lack of seriousness in negotiation or the deliberate failure to make a material disclosure in the contract shall be deemed negotiation in bad faith.

المادة 42

1. If the contracting parties agree on the material matters in the contract and to postpone agreement on the non-material matters, such agreement shall be sufficient to deem the acceptance as having met the offer. Disagreement over the non-material matters shall not affect the conclusion of the contract, unless the parties stipulate that the conclusion of the contract is conditional upon agreement on such matters. 2. If the contracting parties fail to agree on the non-material matters, the court shall decide on such matters in accordance with legal provisions, the nature of the dealing, and custom.

المادة 43

1. A promise made by either or both parties to conclude a contract in the future shall not be binding, unless the parties agree on the material matters in said contract and the deadline for its conclusion, and the conditions of the contract are satisfied at the time such promise is made, including any formalities required by legal provisions for such contract. 2. If the promisor fails to fulfill his promise and the promisee demands fulfillment thereof and the terms of the contract are satisfied, a judgment by the court shall, if issued, stand in place of the contract.

المادة 44

1. A deposit paid at the time of concluding a contract shall mean that only the payer of the deposit has the right to withdraw from the contract and that, upon his withdrawal, he may not recover the deposited amount, unless agreed otherwise. 2. If the contracting parties do not set a deadline for withdrawal from the contract, the court shall set a deadline according to custom and the circumstances of the contract. 3. If the payer of the deposit remains silent until the expiration of the deadline or if he fails to perform his obligations prior to such expiration, he shall be deemed to have withdrawn from the contract.

المادة 45

A framework agreement is a contract under which the contracting parties determine the basic terms governing any contracts concluded between them in accordance with the provisions of such agreement; the framework agreement shall be deemed part of the contracts concluded by the contracting parties.

المادة 46

If the contracting parties make in the contract an explicit or implicit reference to the provisions of a model document, to specific rules, or to any other document, the same shall be deemed part of the contract. 2. Legal Capacity of Contracting Parties

المادة 47

A person shall have the legal capacity to make dispositions, unless deemed fully or partially incompetent by law.

المادة 48

1. A minor, even if he is discerning, and an idiot or lunatic shall be deemed interdicted by law. 2. Imposition of interdiction on spendthrifts and imprudent persons and the removal thereof shall be pursuant to a court ruling. The court may announce its judgment if it finds an interest in doing so.

المادة 49

Dispositions made by a non-discerning minor shall be deemed void.

المادة 50

1. Dispositions made by a discerning minor shall be valid if they are completely to his advantage; if, however, such dispositions are completely to his disadvantage, they shall be void. 2. If the dispositions made by a discerning minor are neither completely to his advantage nor completely to his disadvantage, such dispositions shall be valid; however, his guardian, trustee, or the minor himself upon attaining the age of majority may request such dispositions be invalidated.