Civil Transactions Law: A Quantum Leap In The Nation’s Legal System

Saudi Arabia on Sunday implemented its new Civil Transactions Law, described as a “quantum leap” in the nation’s legal system. The historical legislation approved by the Saudi Cabinet in June is an integral component of the Vision 2030 reform plan, which seeks to ensure that the Kingdom has a clear, fair, and transparent legal system in a time of rapid development.

The law covers areas like the regulation of financial transactions and compensation for damage caused to property or persons. It also made definitions for contracts, including their validity, termination, and all aspects of ownership.

Lawyer Dr. Saud Al-Ammari, who manages a law firm and has trained in both Saudi Arabia and the US, said, “This marks a milestone as the first codification of civil law in the Kingdom,” he added, “Previously, civil law matters in Saudi Arabia were governed by courts’ interpretations of Shariah-based guidelines and principles.” He said that the legislation is “a quantum leap in the Saudi legal system.”

Al-Ammari said, “While the civil law does not violate Shariah, the codification of many Shariah principles enhances the judicial system’s consistency and predictability. Specifically, the new law focuses on contractual and property rights, tort, and other commercial and personal injury matters.” He added, “It stabilizes transactions, reduces the causes of contract invalidation and termination, and expands contractual freedom. In addition, it speeds up the process of resolving disputes and reduces variation in judicial rulings.”