قانون التقاضي المدني في الإماراتمرسوم بقانون اتحادي بإصدار قانون المعاملات المدنية

Article (1) The attached Law Regarding Civil Transactions shall enter into force.

Article (1) 1. The legislative provisions shall apply to all matters they address expressly or implicitly. No room shall be left for Ijtihad (independent legal reasoning) where the text is definitive in its indication. 2. Should the court find no provision in the applicable legislations, it shall rule in accordance with the Islamic Shari'ah, selecting the most appropriate solutions as required by the interest (Maslaha). 3. Should the court find no ruling in the Islamic Shari'ah for the matter before it, it shall rule in accordance with custom (Urf), provided it does not conflict with public order or public morals. If the custom is specific to a particular Emirate, its ruling shall apply to t…

Article (2) Federal Law No. (5) of 1985 Promulgating the Civil Transactions Law of the United Arab Emirates, as amended, is hereby repealed.

Article (2) Reference shall be made to the rules and principles of Islamic jurisprudence (Usul Al-Fiqh) for the understanding, interpretation, and construction of legislative texts.

Article (3) This Decree by Law shall be published in the Official Gazette and shall enter into force from 1 June 2026. Mohamed bin Zayed Al Nahyan President of the United Arab Emirates Issued by Us at the Presidential Palace - Abu Dhabi On: 09 Rabi' Al-Akhir 1447 A.H. Corresponding to: 01 October 2025 A.D.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 2 Civil Transactions Law Preliminary Section General Provisions Chapter One Provisions on the Application and Temporal and Spatial Scope of the Law Part One The Law and its Application

Article (3) The following shall be deemed matters of the public order: 1. The definitive rulings of the Islamic Shari'a. 2. The provisions related to the systems of governance. 3. The provisions related to the personal status of Muslims, such as marriage, inheritance, and lineage.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 3 4. The mandatory legal rules from which derogation by agreement is not permitted and are stipulated in the laws promulgated in the United Arab Emirates. Part Two Temporal Application of the Law

Article (4) 1. The law shall be effective from its date of entry into force and shall not apply retroactively to preceding facts and acts, unless the law provides otherwise. 2. A legislative provision may not be repealed or suspended except by an explicit legislative provision that expressly so provides, or that includes a provision conflicting therewith, or that re-regulates the subject matter previously governed by the earlier legislation. 3. A special provision shall not be repealed or amended by a subsequent general provision, unless the legislation expressly so provides. The special provision shall apply in matters it addresses that conflict with the general provision. 4. If a legislati…

Article (5) 1. Provisions related to legal capacity shall apply to all persons who meet the conditions stipulated in those provisions. 2. If a person has full legal capacity under former provisions and then becomes of limited legal capacity under new provisions, this shall have no effect on their prior acts.

Article (6) 1. New provisions related to the barring of a claim by the lapse of time shall apply from the date of their entry into force to every period that has not yet been completed. 2. Former provisions shall apply to matters concerning the commencement, suspension, and interruption of the period for barring a claim by the lapse of time, for the period preceding the entry into force of the new provisions.

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Article (7) 1. If a new provision prescribes a period for barring a claim by the lapse of time that is shorter than that prescribed by the former provision, the new period shall run from the time the new provision enters into force, even if the former period had commenced before that. 2. If the remainder of the period prescribed by the former law is shorter than the period prescribed by the new provision, the period for barring a claim by the lapse of time shall be completed upon the expiry of this remainder.

Article (8) The provisions in force at the time of preparing the means of evidence, or at the time it ought to have been prepared, shall apply thereto.

Article (9) Time limits shall be calculated according to the Gregorian calendar, unless the law provides otherwise. Part Three Spatial Application of the Law

Article (10) The law of the United Arab Emirates shall be the reference for the characterization of relationships when it is required to determine the type of these relationships in a case involving a conflict of laws, to ascertain the applicable law.

Article (11) 1. The civil status and legal capacity of natural persons shall be governed by the law of the country whose nationality they hold. However, in financial transactions concluded in the United Arab Emirates that produce their effects therein, if one of the parties is a foreigner of limited legal capacity and the limited capacity is due to a reason that is not readily apparent to the other party, this reason shall not affect their legal capacity.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 5 2. Foreign legal persons shall be governed by the law of the country where such persons have established their actual principal management center. If s…

Article (12) The substantive conditions for the validity of a marriage shall be governed by the law of the country in which the marriage was concluded. As for the form, a marriage between two foreigners or between a foreigner and a national shall be considered valid if it is concluded in accordance with the formalities of the country where it was concluded, or if the formalities prescribed by the law of each of the spouses are observed.

Article (13) The law of the country in which the marriage was concluded shall apply to the following: 1. The personal effects and property-related effects arising from the contract of marriage. 2. Divorce, judicial divorce, and separation.

Article (14) In the cases stipulated in Articles (12) and (13) of this Law, if one of the spouses is a national of the United Arab Emirates at the time of the conclusion of the marriage contract, or subsequently becomes a national and retains their nationality until the time the lawsuit is instituted, the law of the United Arab Emirates alone shall apply, except for the condition of legal capacity for marriage.

Article (15) The maintenance obligation among relatives shall be governed by the law of the person liable therefor.

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Article (16) The substantive matters related to guardianship, tutorship, curatorship, and other systems established for the protection of persons lacking or of limited legal capacity and absentees, shall be governed by the law of the person to be protected.

Article (17) 1. Without prejudice to the provisions of Paragraphs (3) and (4) of this Article, succession shall be governed by the law of the country to which the decedent belonged at the time of their death. 2. The financial rights existing within the territory of the State belonging to a foreigner who has no heir shall be a charitable endowment (Waqf), and their oversight and supervision shall be by the competent authority. 3. The substantive provisions of a will and other dispositions taking effect upon death shall be governed by the law of the country designated by the will or disposition, or the law of the country to which the person who made the disposition belonged by nationality at t…

Article (18) 1. The possession and ownership of immovable property and other related real rights (jus in rem) shall be governed by the law of the location of the immovable property. 2. Movable property shall be governed by the law of the country where it is located at the time the cause giving rise to the acquisition or loss of its possession, ownership, or other related real rights (jus in rem) occurs.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 7 3. The law of the country where property is located shall determine whether such property is immovable or movable.

Article (19) 1. Contractual obligations, as to both form and substance, shall be governed by the law of the country expressly agreed upon by the parties. If they do not agree, the law of the country in which the contracting parties have their common domicile shall apply. If their domiciles differ, the law of the country where the main obligation of the contract is to be performed shall apply, unless it is clear from the circumstances that another law is intended to be applied. 2. Contracts concluded concerning immovable property shall be governed by the law of its location.

Article (20) 1. Non-contractual obligations shall be governed by the law of the country in which the event giving rise to the obligation occurred. 2. The provision of Paragraph (1) of this Article shall not apply to obligations arising from an unlawful act with respect to events that occur abroad and are lawful in the United Arab Emirates, even if they are deemed unlawful in the country where they occurred.

Article (21) The rules of judicial jurisdiction, and all procedural matters, shall be governed by the law of the country in which the action is instituted or in which the procedures are undertaken.

Article (22) The provisions of the preceding Articles shall not apply where there exists a provision to the contrary in a special law or in an international treaty in force in the State.

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Article (23) The principles of private international law shall be the reference for any matter concerning conflict of laws for which no provision is stipulated in the preceding Articles.

Article (24) The law of the United Arab Emirates shall apply in the case of stateless persons.

Article (25) A person who holds multiple nationalities simultaneously shall be governed by the law of the nationality by virtue of which they entered the State.

Article (26) Where a person simultaneously holds the nationality of the United Arab Emirates and the nationality of another country, the law of the United Arab Emirates shall apply.

Article (27) If it appears from the provisions of the preceding Articles that the applicable law is the law of a country in which multiple legal systems coexist, the internal law of that country shall determine which of such systems shall be applied. If there is no provision therein, the prevailing legal system or the law of the domicile shall be applied, as the case may be.

Article (28) 1. If it is determined that a foreign law is the applicable law, only its internal provisions shall be applied, excluding those related to private international law. 2. The law of the United Arab Emirates shall be applied if the provisions of the private international law related to the applicable law refer back thereto.

Article (29) The provisions of a foreign law designated by the preceding Articles may not be applied if such provisions are contrary to the public order or public morals in the United Arab Emirates.

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Article (30) The law of the United Arab Emirates shall be applied if it is impossible to prove the applicable foreign law or to determine its meaning. Chapter Two Some Interpretive Rules of Jurisprudential Principles (Usul al-Fiqh)

Article (31) Ignorance of the law is no excuse.

Article (32) An exception shall not be extended by analogy, nor shall it be broadly interpreted.

Article (33) A special provision shall restrict a general provision.

Article (34) Any matter established by a mandatory provision shall prevail over any condition.

Article (35) Whatever is indispensable for the fulfilment of an obligation is itself obligatory.

Article (36) A ruling shall exist or cease to exist with the existence or absence of its legal cause.

Article (37) Fungibles shall not cease to exist.

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Article (38) Certainty shall not be removed by doubt.

Article (39) The presumption is the continuance of the status quo.

Article (40) The presumption is freedom from liability.

Article (41) The presumption is the non-existence of incidental attributes.

Article (42) What is proven to exist at a certain time is presumed to continue, unless there is evidence to the contrary.

Article (43) The presumption is that an occurrence is attributed to the nearest possible time.

Article (44) What is established contrary to analogy shall not be used as a basis for analogy in other cases.

Article (45) 1. No harm shall be inflicted nor reciprocated. 2. Harm shall be removed. 3. Harm shall not be removed by an equivalent harm.

Article (46) Shari‘ah permissibility negates liability.

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Article (47) 1. Private harm shall be borne to avert public harm. 2. A greater harm shall be removed by a lesser harm.

Article (48) Necessities permit prohibitions, and necessity shall be measured by its extent.

Article (49) Compulsion shall not invalidate the right of another.

Article (50) Averting harm takes precedence over securing benefits.

Article (51) 1. Usage is authoritative, whether general or specific. 2. Usage shall be recognized when it is constant or predominant. 3. Literal meaning shall be disregarded where usage indicates otherwise.

Article (52) A matter recognized by custom is equivalent to a stipulated condition.

Article (53) Designation by custom is equivalent to designation by text.

Article (54) The practice of people constitutes a binding proof and shall be applied.

Article (55) What is impossible by usage is deemed to be actually impossible.

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Article (56) Consideration is given to what is prevalent and common, not to what is rare.

Article (57) Where a preventive cause and a permissive cause conflict, the preventive cause shall prevail.

Article (58) That which is ancillary follows that which is principal and shall not be subject to a separate ruling.

Article (59) If the principal is invalidated, the accessory is invalidated accordingly.

Article (60) That which has lapsed shall not be reinstated, just as that which is non-existent shall not be restored.

Article (61) If a thing is void, that which is contained therein is void.

Article (62) If the principal is void, recourse shall be made to the substitute.

Article (63) No consideration shall be given to conjecture.

Article (64) No weight shall be given to a presumption that is clearly erroneous.

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Article (65) What is established by proof is equivalent to what is established by direct observation.

Article (66) A person is bound by their admission.

Article (67) The accessory may be established despite the non-establishment of the principal.

Article (68) Appearance serves as proof for defence, but not for the establishment of a right.

Article (69) Entitlement to return shall arise from the assumption of liability, and entitlement to profit shall arise from bearing risk of loss.

Article (70) Whoever hastens to obtain something before its time shall be punished by deprivation thereof.

Article (71) Whoever seeks to invalidate what has been concluded on their part, their endeavour shall be rejected.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 14 Chapter Three Persons Part One Natural Person

Article (72) The legal personality of a human shall commence upon complete live birth and shall terminate upon death. The law shall determine the rights of a conceived fetus.

Article (73) 1. The event of birth and death shall be established by its registration in the records designated for that purpose. 2. If the event of birth or death is not registered in the records, or where the registration is proven to be inaccurate, such occurrence may be established by any of the legally admissible means of evidence. 3. The records related to births, deaths, and notifications thereof shall be regulated by a special law.

Article (74) The provisions regarding persons of unknown lineage, the missing persons, and the absentees shall be regulated by special laws. In the absence thereof, the provisions of Islamic Shari'ah shall apply to them.

Article (75) 1. The nationality of the United Arab Emirates shall be regulated by law. 2. A national is any person whose nationality of the United Arab Emirates is established in accordance with the provisions of the law, and a foreigner is any person whose such nationality is not established.

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Article (76) The family of a person shall consist of their spouse and their relatives by consanguinity. Relatives by consanguinity shall be deemed to include all persons who share a common ancestor.

Article (77) 1. Direct kinship is the relationship between ascendants and descendants. 2. Indirect kinship is the relationship between persons who share a common ancestor without either being an ascendant or descendant of the other.

Article (78) In calculating the degree of direct kinship, each ascending generation to the common ancestor shall be counted as one degree, excluding that ancestor. In calculating the degree of indirect kinship, the degrees shall be counted upward from the descendant to the common ancestor, and then downward from that ancestor to the other descendant, each generation shall be counted as one degree, excluding the common ancestor.

Article (79) The relatives of one spouse shall be deemed to be in the same degree of kinship with respect to the other spouse.

Article (80) 1. The domicile is the place where a person habitually resides. 2. A person may have more than one domicile at the same time. 3. If a person has no place of habitual residence, they shall be deemed to have no domicile.

Article (81) The place where a person conducts a trade, profession, or craft shall be deemed a domicile with respect to the management of affairs related to that trade, profession, or craft.

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Article (82) 1. The domicile of a person lacking legal capacity, a minor, an interdicted person, a missing person, and an absentee shall be the domicile of their legal representative. 2. A minor authorized to trade shall have a special domicile for the acts and dispositions that the law deems them competent to perform.

Article (83) 1. An elected domicile may be designated for the performance of a specific legal act, and shall apply for all matters relating to such act, including compulsory enforcement procedures, unless it is expressly stipulated that such domicile shall be limited to certain acts. 2. The existence of an elected domicile shall not be established except by writing.

Article (84) 1. Every person who has reached the age of majority, enjoying full mental capacity, and has not been interdicted shall have full legal capacity to exercise their civil rights. 2. A person reaches the age of majority upon completing eighteen (18) Gregorian years.

Article (85) 1. A person lacking discernment due to their minority of age, mental incapacity, or insanity shall not be competent to exercise civil rights. 2. Any person who has not attained seven (7) Gregorian years of age shall be deemed to lack discernment. 3. The age of discernment shall be seven (7) complete Gregorian years.

Article (86) A person shall be deemed to have limited legal capacity, as determined by law, in the following cases: 1. Any person who has attained the age of discernment but has not attained the age of majority.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 17 2. Any person who has attained the age of majority and is prodigal or suffers from legal imprudence.

Article (87) A person lacking legal capacity, a person of limited legal capacity, a missing person, and an absentee shall, as the case may be, be subject to the provisions governing guardianship, tutorship, curatorship, or representation of the absentee, in accordance with the rules prescribed by law.

Article (88) No person may waive their personal freedom or their legal capacity, nor alter the rules governing them, nor make either the subject of any form of transaction.

Article (89) The material elements of a human being may not be the subject of dispositions contrary to the law, public order, or public morals.

Article (90) Any person whose personality rights have been unlawfully infringed upon may request the cessation of such infringement, along with compensation for any damage sustained.

Article (91) 1. Every person shall have a name and a surname, and their surname shall be borne by their children. 2. A special law shall regulate the manner of acquiring and changing names and surnames. 3. Any person whose right to use their name or surname, or both, is disputed by another without just cause, or whose name or surname, or both, is usurped by another without right, may request the cessation of such infringement, along with compensation for any damage sustained.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 18 Part Two Legal Persons

Article (92) Legal persons are: 1. The State, the Emirates, and other administrative units to which the law grants legal personality. 2. Federal or local public authorities, establishments, institutions, and other entities to which the law grants legal personality. 3. Religious bodies and sects recognized by the State as having legal personality. 4. Endowments (Waqfs). 5. Civil and commercial companies, except as excluded by a special provision. 6. Private associations and foundations, federations, social solidarity fund, and other institutions of public benefit established in accordance with the law. 7. Any group of persons or property to which legal personality is granted by virtue of the…

Article (93) A legal person shall enjoy all rights, except those which are inherent in the natural attributes of a human being, within the limits prescribed by law.

Article (94) A legal person shall have: 1. An independent financial patrimony. 2. Legal capacity within the limits designated by its instrument of establishment or as prescribed by law. 3. The right to litigate. 4. An independent domicile. The domicile of a legal person shall be deemed to be the place where its management center is located. As for legal persons whose principal center is abroad and which have an activity in the United Arab Emirates, their management center shall, for the purposes of the law of the United Arab Emirates, be considered the place where the local management is located.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 19 5. A…

Article (95) Legal persons shall be subject to the provisions of the special laws governing them. Chapter Four Property and Things

Article (96) Property (Mal) is any tangible thing or right that has a material value in transactions.

Article (97) Property may be lawful (Mutaqawwim) or unlawful (non-Mutaqawwim). Lawful (Mutaqawwim) property is that which may be lawfully enjoyed, while unlawful (non- Mutaqawwim) property is that which may not be lawfully enjoyed.

Article (98) Anything that can be corporeally or incorporeally possessed and lawfully enjoyed, and that is not excluded from transactions by its nature or by virtue of the law, may constitute the subject of financial rights.

Article (99) 1. Things that are excluded from transactions by their nature are those that no one can exclusively possess. 2. Things that are excluded from transactions by virtue of the law are those that the law does not permit to be the subject of financial rights.

Article (100) 1. Fungible things are those whose individual units or parts are identical or substantially similar, so that by custom one may substitute another without any appreciable distinction, and which are valued in transactions by number, measurement, capacity, or weight.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 20 2. Non-fungible things are those whose individual instances differ appreciably in description or value, or whose individual units are rarely found in circulation.

Article (101) 1. Consumable things are those whose utility is realized only through their consumption or expenditure. 2. Non-consumable things are those whose utility is realized by their repeated use while their substance remains intact.

Article (102) Anything that is fixed in its place and cannot be moved without deterioration or alteration of its form shall be deemed immovable; anything else shall be deemed movable.

Article (103) A movable placed by its owner on an immovable owned thereby for the purpose of serving or exploiting such immovable shall be deemed immovable by destination, even if it is not permanently affixed to the immovable.

Article (104) 1. All immovable and movable properties belonging to the State or public legal persons and allocated for public benefit, either in fact or by virtue of the law, shall be deemed public property, which may not be disposed of, attached, or acquired by lapse of time. 2. Immovable and movable properties owned by any other entity shall be deemed public property under the following conditions: a. They are allocated for public benefit. b. The law provides for their consideration as public property and specifies the prescribed aspects of protection for them.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 21 Chapter Five The Right Part One Scope o…

Article (105) Whoever lawfully exercises their right shall not be liable for any damage resulting therefrom to others.

Article (106) 1. Whoever unlawfully exercises their rights shall be held liable. 2. The exercise of a right shall be deemed unlawful if: a. The intent to cause harm is present. b. The interests sought to be achieved through such exercise are contrary to the provisions of the law, public order, or public morals. c. The anticipated interests are disproportionate to the harm inflicted upon others. d. Such exercise exceeds what is established by custom and usage. Part Two Categories of Rights

Article (107) A right may be personal, real, or incorporeal.

Article (108) A personal right is a legal relationship between a creditor and a debtor, by virtue of which the creditor is entitled to demand that the debtor transfer a real right (jus in rem), perform an act, or refrain from an act.

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Article (109) 1. A real right (jus in rem) is a direct legal power over a specific thing, conferred by law to a specific person. 2. A real right (jus in rem) may be principal or accessory.

Article (110) 1. Principal real rights are the right of ownership and the rights derived therefrom, namely the rights of disposition, usufruct, use, habitation, Musataha, easement, and any other right so provided for by law. 2. Accessory real rights are the mortgage, the possessory pledge, and privilege.

Article (111) 1. Incorporeal rights are those that attach to an intangible thing. 2. Incorporeal rights include neighbouring rights, trademarks, industrial property rights, and other incorporeal rights that shall be governed by special laws. Book One Obligations Section One Sources of Obligation

Article (112) Obligations, or personal rights, arise from legal acts, legal facts, and the law. The sources of obligation are: 1. The Contract. 2. The Unilateral Act. 3. The Harmful Act (Tort). 4. The Beneficial Act (Unjust Enrichment). 5. The Law.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 23 Chapter One The Contract Part One General Provisions

Article (113) 1. A contract is the binding concurrence of an offer made by one of the contracting parties with the acceptance of the other, and their agreement in a manner that produces its legal effect in respect of the subject matter of the contract, resulting in an obligation binding each party toward the other. More than two wills may also concur in producing a legal effect. 2. A contract constitutes the law governing the contracting parties; it may not be rescinded or amended except by mutual agreement of the parties, or for reasons prescribed by law.

Article (114) A contract may pertain to the following: 1. Property, whether movable or immovable, tangible, or intangible. 2. Benefits derived from things. 3. A specific act or service. 4. Any other thing for which dealing or being obligated is not prohibited by a provision of law or contrary to public order or public morals.

Article (115) 1. The general provisions stipulated in this chapter shall apply to both named and unnamed contracts. 2. The special rules for certain contracts set out within the provisions related to each of them in this Law or other laws shall apply. 3. The general provisions shall apply in matters not conflicting with the special provisions.

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Article (116) 1. A contract is bilateral (synallagmatic) when each contracting party undertakes obligations toward the other. 2. A contract is unilateral when a person or several persons obligate themselves towards another person or several other persons without a corresponding obligation on their part.

Article (117) 1. The contract shall be consensual when it is concluded merely by the exchange of consent between the parties by any means whatsoever. 2. A contract shall be formal when its conclusion requires compliance with the form determined by the law. 3. A contract is deemed a real contract when its conclusion is conditional upon the delivery of a specific thing.

Article (118) 1. A negotiated contract is one whose terms are freely negotiated between the parties. 2. A contract of adhesion is one whose general terms are predetermined by one party and are not subject to negotiation. Part Two Interpretation of the Contract

Article (119) 1. If the wording of a contract is clear, one may not be departed from it by way of interpretation to ascertain the common intention of the contracting parties. 2. If there is a room for interpreting a contract, the common intention of the contracting parties shall be sought, without being confined to the literal meaning of the words, guidance shall be drawn from the nature of the transaction and from the honesty and trust that should prevail between the contracting parties in accordance with the custom prevailing in transactions.

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Article (120) 1. The governing principle of a contract is the consent of the contracting parties and what they have committed to in the contract. 2. Any doubt shall be interpreted in favour of the debtor. However, the interpretation of ambiguous terms in contracts of adhesion shall not be interpreted in a manner prejudicial to the adhering party. 3. In contracts, regard shall be had to intentions and meanings rather than to words and forms. 4. Words shall be construed according to their literal meaning; and a term shall not be construed metaphorically unless its literal meaning cannot be applied. 5. No implication shall prevail over an express statement. 6. Giving effect to contractual wordi…

Article (121) 1. The initiation of pre-contractual negotiations, their conduct, and their termination shall be in accordance with the requirements of good faith. 2. If negotiations are conducted, they do not create an obligation on the parties to conclude this contract. 3. Whoever negotiates or terminates negotiations in bad faith shall be liable to compensate the actual damage suffered by the other party. Compensation shall not include the expected benefits from the contract that was not concluded, or the lost opportunities in achieving such benefits, unless otherwise agreed. 4. Bad faith shall be deemed to include the deliberate failure to disclose material information that has a substanti…

Article (122) 1. A party to negotiations or a contract who has knowledge of information that is of decisive importance to the consent of the other party shall inform them of it whenever the other party's ignorance of the information is presumed or they have placed their trust in the other contracting party. Information that has a direct and necessary connection to the content of the contract or the status of the parties shall be considered essential and decisive information for the consent of the parties. 2. Disclosure of essential and decisive information is an obligation that falls on both parties to the negotiations or contract, under which each party is obliged to exercise due care to pr…

Article (123) Any person who uses or discloses without permission confidential information obtained in connection with negotiations or a contract shall be liable in accordance with the general rules. Part Four Pillars, Validity, Options, and Types of a Contract First: Elements of a Contract

Article (124) The necessary elements required for the conclusion of a contract are: 1. The mutual consent of the parties with respect to the contract's essential elements. 2. The subject matter of the contract exists or is capable of existing, is determinate or capable of determination, and is lawful to transact in. 3. The cause of the contract is lawful.

Article (125) 1. Offer and acceptance are any manifestation of will expressing the exercise of the right to conclude a contract; that which is issued first constitutes the offer, and that which is expressed subsequently constitutes the acceptance. 2. The contract is concluded as soon as the offer is linked with the acceptance and they are in agreement, with due regard to any specific conditions that the law may prescribe for its conclusion. 3. If more than one offer is issued before acceptance, the final offer shall be considered. 4. If the acceptance is coupled with what adds to, restricts, or modifies the offer, it is considered a rejection that includes a new offer.

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Fede…

Article (126) 1. The manifestation of will shall be: a. By words or in writing, and it may be in the past tense, as well as in the present or imperative tense, where either is intended to express the present. b. By a gesture customarily understood, even from a person who is not mute. c. By an actual exchange indicating consent. d. By adopting any other course of conduct which, in the circumstances of the case, leaves no doubt as to its indication of consent. 2. The manifestation of will may be implicit, unless the law provides or the two parties agree that it must be explicit.

Article (127) 1. The offer of goods and services accompanied by a statement of the consideration shall be deemed an offer, unless indications exist to the contrary. 2. Publication, advertisement, and statements of current prices, and any other statement related to offers or requests addressed to the public or to individuals, are not considered an offer in case of doubt, but rather an invitation to contract.

Article (128) 1. The silence of the person to whom the offer is directed shall not be deemed an acceptance, unless an agreement or an indicium exists indicating that it is. 2. Silence is considered an acceptance if there was a prior dealing between the contracting parties and the offer was related to this dealing, or if this offer was purely for the benefit of the offeree.

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Article (129) The contracting parties shall have the option to revoke the offer until the end of the contractual session (majlis). The offer shall lapse in the following cases: 1. If the offeror expressly or implicitly retracts it before acceptance is issued. 2. If it is expressly or implicitly rejected by the offeree. 3. If the acceptance does not customarily follow the offer, or if the period specified by the offeror for acceptance expires without it being issued. 4. If the offeror or the offeree dies, or if either of them loses their legal capacity before acceptance is issued, even if the offer has a specific duration.

Article (130) 1. If a time limit is specified for acceptance, the offeror is bound to keep the offer open until the expiry of that time limit. 2. If no time for acceptance is specified, the time shall be deduced from the circumstances of the case, the nature of the transaction, or custom. 3. If the offeror withdraws their offer before the time expires, the person to whom the offer was addressed may claim compensation for the damage they incurred, without this including any expected profit from the conclusion of the contract.

Article (131) 1. The contract shall not be concluded unless the parties agree on the essential elements of the obligation and on the other legitimate conditions that the parties consider essential. 2. If the parties agree on the essential elements of the obligation and on the other legitimate conditions that they consider essential, and they reserve secondary matters to be agreed upon later and do not stipulate that the contract shall not be concluded in the absence of agreement on these matters, the contract shall be deemed concluded. If a dispute arises over matters not agreed upon, the court shall rule thereon according to the nature of the transaction and the provisions of the law.

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Article (132) 1. If the contracting parties were present in one place or in two different places but are connected via direct means of communication, the contract shall be considered to have been concluded at the time and place where the acceptance was issued, unless the law or the agreement stipulates otherwise. 2. If the contracting parties are absent, the contract shall be considered to have been concluded at the time and place where the offeror learned of the acceptance, unless the law or the agreement stipulates otherwise.

Article (133) Without prejudice to the provisions contained in other laws, a contract by auction shall not be concluded except by the fall of the hammer. A bid shall lapse upon the submission of a higher bid, even if it is void, or by the closing of the auction without it being awarded to any person.

Article (134) Acceptance in contracts of adhesion shall be limited to mere acceptance to uniform conditions set by the offeror for all their other contracting parties and which are not open to negotiation.

Article (135) 1. An agreement under which both or one of the contracting parties undertakes to conclude a specific contract in the future shall not be valid unless all the essential elements of the contract intended to be concluded and the period within which it shall be concluded are specified. 2. If the law requires that a form be fulfilled for the completion of the contract, compliance with this form shall be observed in the agreement that includes the promise to conclude the contract.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 31

Article (136) If a person undertakes to conclude a contract, then reneges thereon, and the other party brings a claim seeking enforcement of the undertaking, and the requirements for the conclusion of the contract are met, particularly those relating to its form, the judgment, once it has acquired the force of a final ruling, shall stand in place of the contract.

Article (137) 1. Payment of earnest money upon concluding the contract indicates that the contract has become final and may not be withdrawn from, unless the agreement or custom provides otherwise. 2. If the contracting parties agree that the earnest money is a penalty for withdrawal from the contract, each of them has the right to withdraw. If the party who paid the earnest money withdraws, they shall forfeit it, and if the party who received it withdraws, they shall return it together with an equivalent amount.

Article (138) A framework agreement is a contract pursuant to which the contracting parties determine the principal terms that govern the contracts they conclude between them in accordance with the provisions of this agreement. This agreement shall be deemed to form part of those contracts, unless otherwise expressly or implicitly agreed. Second: Representation in Contracting

Article (139) 1. Contracting by representation is permissible, unless the law provides otherwise. 2. Representation in contracting may be contractual, legal, or judicial. 3. Where the representation is contractual, the instrument of authority issued by the principal shall determine the scope of the powers of the representative. 4. Where the representation is legal, the law shall determine the powers of the representative.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 32 5. Where the representation is judicial, the court shall determine the powers of the representative. 6. The representative may not exceed the limits of powers conferred upon them.

Article (140) Whoever personally concludes a contract for their own account is solely bound by the effects resulting therefrom.

Article (141) 1. If a contract is concluded by way of representation, the person of the representative, not that of the principal, shall be taken into consideration in determining defects of consent, or the effect of knowledge of certain special circumstances, or the imputation of knowledge thereof. 2. If the representative is an agent acting in accordance with specific instructions issued thereto by their principal, the principal may not rely on the agent's ignorance of circumstances that the principal knew or ought to have known.

Article (142) If a representative concludes a contract in the name of the principal within the limits of their agency, the effects of this contract and the rights and obligations arising from it shall accrue to the principal.

Article (143) If the contracting party, at the time of concluding the contract, does not declare that they are contracting in the capacity of a representative, the effects of the contract shall not be attributed to the principal, whether as creditor or debtor, unless it was necessarily to be presumed that the person with whom the representative contracted knew of the existence of the representative, or it was immaterial to them whether they dealt with the principal or the representative.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 33

Article (144) Where both the representative and the person with whom they contract are unaware, at the time of concluding the contract, of the termination of the representation, the effects of the contract concluded by the representative shall be attributed to the principal or their successors.

Article (145) A person may not be permitted to contract with themself in the name of the person they represent, whether the contract is for their own account or for the account of another person, without the authorization of the principal. However, the principal in this case may ratify the contract. Without prejudice to any contrary provisions of the law or the rules of commerce. Third: Capacity to Contract

Article (146) Every person is competent to contract, unless their capacity is removed or restricted by law.

Article (147) A non-discerning minor has no right to dispose of their property, and all their acts shall be void.

Article (148) 1. Financial acts made by a discerning minor shall be valid if they are exclusively beneficial, and void if they are exclusively detrimental. 2. Financial dispositions made by a discerning minor that fall between benefit and detriment shall be voidable to their benefit. Their guardian has the right to seek annulment of the disposition within one year from the date of knowledge thereof, and the discerning minor has the right to seek annulment of the disposition within one year after attaining the age of majority.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 34

Article (149) 1. The court, upon the request of the guardian or the tutor, or of the discerning minor who has completed fifteen (15) Gregorian years of age, and after conducting the necessary investigation, may authorize the discerning minor to administer all or part of their property, whether unrestricted or subject to such restrictions as it deems appropriate. The guardian, the testamentary guardian, or the discerning minor shall be bound to render an account of such administration at the times specified by the court. 2. The court may revoke or restrict the authorization for administration whenever it deems it necessary. 3. The acts of an authorized discerning minor shall be valid within t…

Article (150) The guardian of a minor's property shall be their father, then their father's testamentary guardian, then the paternal grandfather, and thereafter the court or the custodian appointed thereby.

Article (151) The law shall determine the capacity required to be met by a guardian to exercise the rights of guardianship over the property.

Article (152) 1. Acts of administration issued by a tutor concerning a minor's property shall be valid and effective in accordance with the conditions and circumstances prescribed by law. 2. The following are considered acts of management: leases whose term does not exceed three (3) years, acts of preservation and maintenance, collection of rights and payment of debts, sale of agricultural produce, sale of perishable movables, and expenditure on the minor.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 35

Article (153) The acts carried out by a tutor concerning a minor's property that do not constitute acts of administration, including sale, mortgage, loan, settlement, and partition of undivided property and investment of funds, shall be valid and effective only with the authorization of the court, in accordance with the conditions and instances prescribed by law.

Article (154) A person suffering from insanity or mental incapacity shall be interdicted by operation of law. Any acts concluded by either of them shall be void if it is concluded after the issuance of the interdiction decision. If the act is concluded before the interdiction decision, it shall not be void unless the state of insanity or mental incapacity was notorious at the time of contracting, or the other party was aware thereof.

Article (155) 1. The interdiction of the prodigal and the person of impaired judgement, and the lifting thereof, shall be by a judgment of the court, and the court may publish the judgment. 2. The acts of the prodigal and the person of impaired judgement after interdiction shall be subject to the same rules as the acts of a discerning minor. Their acts prior to interdiction shall be valid, unless they result from exploitation or collusion, or if the condition was notorious, or the other party was aware thereof.

Article (156) 1. The court, after conducting the necessary investigation, may authorize the prodigal or the person of diminished judgement to administer all or part of their property, with an unrestricted or restricted authorization as it deems appropriate. It may also require the prodigal to render an account of their administration at the times it specifies. 2. The court may rescind or revoke the authorization for administration if it deems it necessary.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 36

Article (157) The laws shall specify the procedures to be followed for the interdiction of persons suffering from insanity, the management and investment of their property, and the acts relating thereto, and other matters related to guardianship, tutorship, and curatorship.

Article (158) 1. If a person is deaf and mute, blind and deaf, or blind and mute, or suffers from illness requiring assistance, and is unable, as a result thereof, to express their will as a result thereof, the court may appoint a judicial assistant to assist them in the acts as their interest requires. 2. Any act for which judicial assistance has been ordered shall be voidable if it is carried out by the person for whom assistance has been ordered without the assistance of their judicial assistant after the issuance of the order for assistance.

Article (159) The acts carried out by a guardian, tutor, curator, and representative of an absentee are valid within the limits prescribed by law.

Article (160) If a person of limited capacity resorts to fraudulent means to hide their lack of capacity, they shall be bound to compensate the other party for the damage suffered as a result of the annulment of the contract. Fourth: Defects of Will 1. Mistake

Article (161) If a mistake occurs in the nature of the contract, or in a condition of its formation, or in its subject matter, the contract shall be voidable.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 37

Article (162) 1. If a contracting party falls into an essential mistake, they may request the annulment of the contract if the other contracting party has fallen into the same mistake, or was aware thereof, or could easily have detected it. 2. In contracts of donation, the annulment of the contract may be requested without regard to the other contracting party’s knowledge of or participation in the mistake.

Article (163) A mistake is material if it is of such gravity that the contracting party would have refrained from concluding the contract had they not fallen into it. A mistake is considered material in particular: 1. If it occurs in a desired attribute of the thing that is essential in the consideration of the contracting parties, or shall be considered as such, given the surrounding circumstances of the contract and requirements of good faith. 2. If the mistake occurs in the identity of the contracting party or in an attribute thereof, and such identity or attribute was the principal reason for entering into the contract.

Article (164) A contracting party may request the annulment of the contract if they have made a mistake as to the law and the conditions for a mistake of fact in accordance with the provisions of Article (163) of this Law are met, unless the law provides otherwise.

Article (165) A mere error in calculation or writing shall not affect the validity of the contract, but shall be corrected.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 38

Article (166) A person who has made a mistake may not invoke it in a manner that conflicts with the dictates of good faith, and shall be bound by the contract which they intended to conclude if the other contracting party has expressed their readiness to perform it. 2.Coercion (Ikrah)

Article (167) 1. Coercion is the compulsion of a person, without right, to perform an act without their consent. Coercion may be irresistible or non-irresistible, and may also be material or moral. 2. Coercion shall be compelling if it involves a threat of serious and imminent danger to the person or property, and shall be non-compelling if it involves a threat of a lesser degree. 3. Irresistible coercion vitiates consent, whereas non-irresistible coercion negates consent but does not invalidate free choice.

Article (168) 1. A contracting party may request the annulment of the contract on grounds of coercion if they contracted under the influence of fear unlawfully instilled by the other contracting party. Fear shall be deemed to exist if the circumstances lead the party invoking it to perceive that a serious and imminent danger threatens them or another, whether materially or morally, in relation to life, the body, honour, property, or otherwise, and where the coerced party would not have concluded the contract but for the existence of coercion. 2. In assessing coercion, due regard shall be had to the gender, age, social and health condition of the person subjected thereto, and any other circum…

Article (169) If coercion is exerted by a third party, the coerced party may not request the annulment of the contract unless it is proven that the other contracting party knew, or ought necessarily to have known, of such coercion. 3. Deception and Unfairness

Article (170) Deception is when one of the contracting parties deceives the other by fraudulent means, whether verbal or physical, which induces them to consent to that to which they would not have otherwise consented.

Article (171) Deliberate silence regarding a fact or circumstance constitutes deception if it is proven that the person so deceived would not have concluded the contract had they been aware of that fact or circumstance.

Article (172) If one of the contracting parties deceives the other and it is established that the contract was concluded with gross unfairness, the person so deceived may request the annulment of the contract.

Article (173) 1. Unfairness is the lack of equivalence between the rights acquired by a contracting party under the contract and the obligations they bear thereunder. 2. Unfairness may be either minor or gross. Minor unfairness is that which falls within the assessment of valuers, and gross unfairness is that which does not fall within the assessment of valuers.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 40

Article (174) 1. If a contract results in gross unfairness to any person lacking or of limited legal capacity, or to an endowment authority, the aggrieved party may request the modification of their obligation or the obligation of the other party so as to remove the unfairness. 2. The fact that the contract was concluded on behalf of the aggrieved party by their legal representative in accordance with the law, or that it was authorized by the court, shall not preclude a challenge on grounds of gross unfairness. 3. No challenge shall be admissible solely on the grounds of unfairness in a contract concluded by way of auction.

Article (175) A contract shall be voidable if unfairness affects the property of a person interdicted for debt or a person suffering from a terminal illness, even where the unfairness is slight, provided that their debts exhaust their property, and the unfairness has neither been removed nor approved by the creditors.

Article (176) If the deception is committed by a third party, and the person so deceived proves that the other contracting party was aware of the deception, they may request the annulment of the contract.

Article (177) A contract shall not be annulled for gross unfairness without deception, except in relation to the property of an interdicted person, the property of an endowment, and public property.

Article (178) The right to annul a contract for deception with gross unfairness shall lapse upon the death of the person entitled to request annulment, by the disposition of the subject matter of the contract in whole or in part in a manner entailing ratification, and by the perishing,

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 41 consumption, impairment, or increase of the subject matter of the contract while in the possession of the aggrieved party. 4. Exploitation

Article (179) 1. If a person exploits another's pressing need, manifest recklessness, overpowering desire, lack of experience, apparent weakness, or exploits their moral authority over them, and thereby induces them to conclude, for their own benefit or for the benefit of another, a contract that at the time of its conclusion entails a gross disparity between what they are obliged to perform thereunder and the material or moral benefit accruing thereto, the aggrieved party may request the annulment of the contract or the reduction of their obligation. The other contracting party may avert the annulment of the contract by offering what the court deems sufficient to remove the unfairness. 2. I…

Article (180) 1. Every contract shall have a subject matter to which it is attached. 2. The subject matter may consist of a tangible thing, a benefit, any other financial right, an act, or an abstention from an act. 3. The subject matter may be a future thing specified by its type and quantity. 4. The estate of a person who is alive may not be the subject matter of a contract, even if they have consented thereto, except in the cases stipulated by law.

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Article (181) 1. The subject matter shall meet the following conditions: a. It shall exist or be capable of existence. b. It shall not be outside the scope of dealing by its nature or by law, or contrary to public order or public morals. c. It shall be determined in itself, or by its type and quantity, or it shall be determinable. d. It shall not be impossible in itself at the time of the conclusion of the contract. 2. The contract shall be void if the subject matter does not meet the conditions set out in Paragraph (1) of this Article.

Article (182) If the parties to the contract do not agree on the quality of the subject matter of the contract and it cannot be inferred from custom or the nature of the transaction, the debtor is obliged to deliver the subject matter with a quality that is consistent with the lawful expectations of the parties, taking into account the nature of the subject matter, customs, and the amount of the consideration.

Article (183) If the subject matter of the disposition or its consideration is money, its amount and type shall be stated, and any increase or decrease in the value of such money at the time of performance shall have no effect.

Article (184) 1. A contract may include any condition agreed upon by the contracting parties, provided that such condition is not contrary to the law, public order, or public morals. 2. If a contract includes a condition that is contrary to the law, public order, or public morals, the condition alone shall be void, and either contracting party may request annulment of the contract if it is established that they would not have consented to the contract without that condition.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 43 Sixth: Cause

Article (185) 1. The cause is the direct purpose intended from the contract. 2. Every contract for which no cause is stated shall be presumed to have an existing and lawful cause, unless there is evidence to the contrary. 3. The cause stated in the contract shall be deemed to be the true cause, and the burden of proof shall lie on the person who claims otherwise. 4. If the contract has no cause, or the cause is contrary to the law, public order, or public morals, the contract shall be void. Seventh: The Valid, Void, and Voidable Contract 1. The Valid Contract

Article (186) A valid contract is a contract that is lawful in its essence and attributes, issued by a person having capacity, related to a subject matter capable of being governed thereby, has an existing, valid, and lawful purpose, and its attributes are valid. 2. The Void Contract

Article (187) 1. A void contract is a contract that is unlawful in its essence and attributes, due to the defect of any of its elements, its subject matter, its cause, or the form imposed by law for its conclusion. Such a contract shall not produce any effect and shall not be subject to ratification. 2. Any interested party may assert the nullity, and the court may declare it of its own motion. 3. A claim of nullity shall not be heard after the lapse of fifteen (15) years from the date of conclusion of the contract.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 44 3. The Voidable Contract

Article (188) 1. A contract shall be voidable if it is concluded by an unauthorized person (Fuduli) in respect of the property of another, or by an owner in respect of property to which another has a right, or by a person of limited legal capacity in respect of their property, where the disposition is capable of resulting benefit and detriment, or by a person under coercion, or if the law so provides. 2. A voidable contract shall produce its effects unless it is annulled. If it is annulled, it shall be deemed as if it never existed. If it is ratified, the ratification shall take effect retroactively from the date of its conclusion, without prejudice to the rights of third parties.

Article (189) 1. The ratification of a voidable contract may be effected by the owner, or by the person who has a right in the subject matter of the contract, or by the guardian or curator, or by the person of limited legal capacity after the completion of their capacity, or by the person under coercion after the cessation thereof, all in accordance with the provisions of the law. 2. If the law grants one of the contracting parties the right to annul the contract, the other contracting party may not assert this right. 3. The ratification of a voidable contract, whether express or implied, by the person who has the right to request its annulment, shall cause such right to lapse in respect of…

Article (190) Any person having an interest may serve a notice upon the person entitled to annul the contract, requiring them to declare their intention to assert the nullity within a period of not less than ninety (90) days, commencing from the day following the date of receipt of such

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 45 notice. If the period expires and they have not expressed their intention without an acceptable excuse, to exercise their right to annulment, such right shall lapse.

Article (191) 1. The right to annul a contract shall lapse if it is not asserted by its holder within one year, unless the law provides otherwise. This period shall commence as follows: a. In the case of limited legal capacity, from the day on which the cause of the incapacity ceases. b. In the cases of mistake or deception with gross unfairness, from the day on which the mistake or deception is discovered or detected. c. In the case of coercion, from the day it ceases. d. In the case of exploitation, from the date of concluding the contract. 2. In all cases, the right of annulment for mistake, deception, or coercion may not be asserted if fifteen (15) years have lapsed since the date of con…

Article (192) 1. In cases of annulment or nullity of the contract, the contracting parties shall be restored to the position in which they were before the conclusion of the contract. If this is impossible, compensation may be awarded. 2. If a contract is annulled due to the limited capacity of a discerning minor, in such cases as permitted by law, such minor shall only be obliged to return the benefit that has accrued to them from the performance of the contract.

Article (193) 1. If a contract is void or voidable in part, that part alone shall be void, unless it is established that the contract would not have been concluded without the part that is void or voidable, in which case the entire contract shall be void. 2. If a contract is void or voidable and the elements of another contract are present, the contract shall be deemed valid as the contract whose elements are present, if it is

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 46 established that the intention of the contracting parties was directed towards the conclusion of that contract. Ninth: The Non-Binding Contract

Article (194) A contract shall be non-binding with respect to one or both of its parties, notwithstanding its validity and effectiveness, where a right of rescission is stipulated in their favor without the need for mutual consent or litigation. Each party may independently rescind it if it is non- binding by its nature with respect to them or if such party has stipulated for themselves an option of rescission. Tenth: Options Affecting the Binding Nature of the Contract 1. Option of Stipulation

Article (195) In binding contracts that admit of rescission, the contracting parties or one of them may stipulate in the contract or thereafter an option of stipulation for themselves or for a third party for a period they agree upon. If they do not agree on a period, the court may determine it according to custom.

Article (196) If an option is stipulated for both contracting parties in financial commutative contracts, neither of the two counter-performances shall pass out of the ownership. Where the option is stipulated for one of them, their property shall not pass out of their ownership, nor shall the property of the other enter into their ownership.

Article (197) The holder of an option of stipulation shall have the right to rescind or ratify the contract. If they choose to ratify, the contract shall become binding, with retroactive effect to the time of its conclusion. If they choose to rescind, the contract shall be rescinded and shall be deemed as though it had never existed.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 47

Article (198) If the option is stipulated for both contracting parties, and one of them chooses to rescind, the contract shall be rescinded even if the other ratifies. If one chooses to ratify, the other shall retain their option for the duration of the option period.

Article (199) 1. Rescission or ratification shall be by any act or statement indicating either of them, whether expressly or implicitly. 2. If the period expires without choosing rescission or ratification, the contract shall become binding.

Article (200) For a rescission to be valid, it shall be chosen within the option period, and the other party shall be informed thereof if the rescission is effected by statement. Neither mutual consent nor litigation shall be required for rescission. As for ratification, knowledge of the other party shall not be required.

Article (201) The option shall lapse upon the death of its holder during its period, and the contract shall become binding with respect to their heirs. The other party shall remain entitled to their option, if the option is granted thereto, until the expiry of its period. 2. Option of Inspection

Article (202) An option of inspection shall be established in contracts that admit of rescission for the person in whose favor the disposition is made, even if not stipulated, where the subject matter of the contract has not been seen and has been determined by designation.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 48

Article (203) The option of inspection shall remain in force until the inspection is made within the agreed- upon period or until a cause of lapse occurs.

Article (204) The option of inspection shall not prevent the effectiveness of the contract; rather, it shall prevent its binding force with respect to the party for whom the option is stipulated.

Article (205) The option of inspection shall not lapse by waiver; however, it shall lapse upon the inspection of the subject matter of the contract and its acceptance, whether expressly or implicitly. It shall also lapse upon the death of its holder, the total or partial perishing of the subject matter of the contract, its defectiveness, or upon any disposition thereof by the option holder that does not admit of rescission or a disposition that creates a right for another.

Article (206) Rescission by the option of inspection shall be effected by any act or statement indicating it, expressly or implicitly, provided that the other contracting party is aware thereof. 3. Option of Selection

Article (207) It may be agreed that the subject matter of the contract shall be one of two or one of three things, and that the option of selection from among them shall vest in one of the contracting parties, provided that the consideration for each is stated and the period for the option is specified.

Article (208) 1. If the contracting parties do not specify a period for the option, the other party may request the court to determine a period for the option.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 49 2. If the period specified for one of them lapses without them making a choice, the other party may request the court to determine the subject matter of the disposition.

Article (209) The contract shall be non-binding on the party who has the right of option until this right is exercised. If the choice is made expressly or implicitly, the contract shall become effective and binding in respect of what has been chosen.

Article (210) The selection of the option shall be preferable to the time at which the contract was concluded.

Article (211) 1. If the option of selection is vested in the purchaser: a. If one of the things perishes while in the seller's possession, the purchaser shall have the option either to take the other thing at its price or to leave it. However, if both things perish together, the sale shall be void. b. If the perishing occurs after the purchaser has taken possession of the subject matter of the sale and one of the two things perishes while in their possession, the perished thing shall be deemed the subject matter of the sale, and the purchaser shall be bound to pay its price, and the other thing shall be held in trust (Amanah). If both things perish successively, the first to perish shall be…

Article (212) If a person vested with the option of selection dies during the option period, their right shall pass to their heirs. 4. Option for a Defect

Article (213) The right to rescind a contract due to the option for defect is established in contracts that are susceptible to rescission, even if this option is not stipulated in the contract.

Article (214) For a defect to give rise to an option, it shall be latent, pre-existing, and have a material effect on the value of the subject matter of the contract, and the purchaser shall be unaware thereof, and the seller shall not have stipulated exemption from liability therefor.

Article (215) 1. If the conditions for a defect as set out in Article (214) of this Law are met, the contract is not binding on the party with the option before taking possession and is subject to rescission thereafter. 2. The contract shall be rescinded before taking possession by any act indicating it, without the need for mutual consent or litigation, provided that the other contracting party is aware thereof. After possession, rescission shall take place by mutual consent or by litigation.

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Article (216) Rescission of a contract for a defect shall entail the restitution of its object to its owner and the recovery of what has been paid.

Article (217) The holder of the option for a defect may keep the subject matter of the contract and claim compensation for the diminution in price.

Article (218) 1. The option for a defect shall lapse by waiver, by acceptance of the defect after becoming aware thereof, by disposing of the subject matter of the contract even before becoming aware thereof, by its perishing or diminution after possession, and by its increase before taking possession where such increase is attached and non-generated therefrom resulting from the act of the purchaser, and after taking possession where the increase is separate and generated therefrom. 2. The option for a defect shall not lapse by the death of its holder and shall be established for their heirs. Part Five Effects of the Contract First: Effects of the Contract as Between the Contracting Parties

Article (219) 1. The legal effect of a valid contract is established in its subject matter and its consideration upon its conclusion, without being contingent on taking possession or any other matter, unless the law or the agreement provides otherwise. 2. The contracting parties shall perform the obligations and exercise the rights imposed on each of them by the contract.

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Article (220) 1. A commutative contract over tangible things, if it meets the conditions for its validity, shall entail the establishment of ownership for each of the contracting parties in the consideration for their property, and the obligation of each to deliver their owned subject matter of the contract to the other party. 2. A commutative contract over the usufruct of tangible things, if it meets the conditions for its validity, obliges the disposer of the property to deliver it to the beneficiary, and obliges the beneficiary to deliver the consideration for the usufruct to the owner of the property.

Article (221) 1. The contract shall be performed in accordance with its contents and in a manner consistent with the requirements of good faith. 2. The contract is not limited to obligating the contracting party to what is stated therein, but also includes its requisites in accordance with the law, custom, and the nature of the obligation. 3. In contracts prepared on standard forms to unify the regulation of contractual relationships, the conditions added to these forms shall prevail over the original conditions, even if the latter are not struck out, unless the law provides that the original conditions may not be contravened.

Article (222) In bilateral contracts, if the reciprocal obligations are due for performance, each of the contracting parties may refrain from performing their obligation if the other contracting party fails to perform what they have undertaken.

Article (223) If a contract is concluded by way of adhesion and contains unfair conditions, the court may modify these conditions or exempt the adhering party from them in accordance with the requirements of justice, and any agreement to the contrary shall be void.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 53

Article (224) If exceptional, general circumstances arise that could not have been foreseen at the time of contracting, and as a result of their occurrence, the performance of the contractual obligation becomes onerous for the debtor, threatening them with serious loss, the court may, depending on the circumstances and after balancing the interests of the parties, reduce the onerous obligation to a reasonable limit or rule for the rescission of the contract. Any agreement to the contrary shall be void. Second: Effects of the Contract with Respect to Third Parties

Article (225) Without prejudice to the provisions relating to inheritance, the effect of the contract shall extend to the contracting parties and the universal successor, unless it is apparent from the contract, the nature of the transaction, or a provision of law that this effect does not extend to the universal successor.

Article (226) If the contract creates personal obligations and rights related to a thing that is subsequently transferred to a particular successor, these obligations and rights shall be transferred to this successor at the time the thing is transferred, if they are among its requisites and the particular successor was aware of them at the time of the transfer of the thing to them.

Article (227) A contract shall not create an obligation upon a third party, but it may grant them a right.

Article (228) 1. If a person undertakes that a third party shall be bound by a certain matter, that third party is not bound thereby. 2. If the third party accepts such undertaking, their acceptance produces no effect except from the time it is made, unless it is apparent that they intended, expressly or implicitly, for the effect of this acceptance to relate back to the time of the undertaking.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 54 3. If the third party refuses the undertaking, the undertaker is obliged to compensate the promisee if there is justification therefor, and the undertaker may be released from compensation by performing the obl…

Article (229) 1. A person may contract in their own name for obligations stipulated for the benefit of a third party, if they have a personal interest, whether material or moral, in the performance of these obligations. 2. A stipulation for the benefit of a third party results in the third party acquiring a direct right against the promisor, entitling them to demand fulfillment thereof, unless it is agreed otherwise, and the promisor may invoke against the beneficiary the defenses arising from the contract. 3. The stipulator may demand that the promisor perform what was stipulated for the benefit of the beneficiary.

Article (230) 1. The stipulator, but not their creditors or heirs, may revoke the stipulation before the beneficiary declares to the promisor or to the stipulator their wish to benefit from it, unless this is contrary to what the contract requires. 2. The revocation of the stipulation shall not have the effect of discharging the promisor from their liability against the stipulator, unless it is expressly or implicitly agreed otherwise. The stipulator may substitute another beneficiary in place of the original beneficiary, and may also reserve for themselves the benefit of the stipulation.

Article (231) In a stipulation for the benefit of a third party, the beneficiary may be a future person, or a person who is not determined at the time of the contract, if it is possible to determine them at the time of performance of the stipulated obligation.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 55 Part Six Dissolution of the Contract

Article (232) If a contract is valid and binding, neither of the contracting parties may revoke the contract, nor modify or rescind it, except by mutual consent, litigation, or by virtue of a provision of law.

Article (233) 1. The contracting parties may mutually agree to rescind the contract after its conclusion. 2. Mutual rescission (Iqala) shall be subject to the general conditions of a contract. 3. Mutual rescission may be effected in respect of part of the subject matter of the contract in exchange for its corresponding consideration. 4. For the validity of mutual rescission of the entire subject matter of the contract, it shall be possible for the contracting parties to return to the state they were in before the contract. 5. As between the contracting parties, mutual recission shall have the effect of rescission; however, with respect to third parties, it shall constitute a new contract.

Article (234) 1. In bilateral contracts, if one of the contracting parties fails to perform their obligation upon its due date, the other contracting party may, after giving notice to the debtor, request the court to order the performance of the contract or its rescission. 2. The court may oblige the debtor to perform, or grant them a grace period if the circumstances so require. It may also refuse rescission if it is established that the debtor has averted rescission by performing their obligation, or if what the debtor has failed to perform is of minor importance in relation to the obligation as a whole. 3. In all cases, the court may award compensation where there is justification therefo…

Article (235) It may be agreed that the contract shall be considered automatically rescinded without the need for a judicial judgment upon failure to perform the obligations arising therefrom. This

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 56 agreement does not exempt the parties from giving notice, unless the contracting parties have expressly agreed to waive such notice.

Article (236) 1. In bilateral contracts, if a force majeure arises rendering performance of an obligation impossible, the corresponding obligations are extinguished, and the contract is rescinded automatically. 2. If the obligation becomes partially impossible, either of the contracting parties may invoke the extinguishment of the corresponding obligation or request the court to rescind the contract. 3. If the impossibility is temporary in continuing contracts, either of the contracting parties may invoke the extinguishment of the corresponding obligation or the modification of the contract, or request the court to rescind the contract.

Article (237) If the contract is rescinded or terminated, the contracting parties shall be restored to the state they were in before the contract. If this is impossible, compensation shall be awarded.

Article (238) If a contract is dissolved due to nullity, rescission, or for any other reason, and each contracting party shall return what they have received from the other, each of them may withhold what they have received as long as the other contracting party has not returned what they received from them or provided a guarantee for this return. Chapter Two Unilateral Act

Article (239) A disposition may be made by the unilateral will of the disposer without being contingent on the acceptance of the person to whom the disposition is made, unless it involves binding a

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 57 third party thereto in accordance with what the law provides, all of this unless the law provides otherwise.

Article (240) The provisions governing contracts shall apply to a unilateral act, except for those relating to the necessity of the existence of two corresponding wills for the creation of the contract, unless the law provides otherwise.

Article (241) If a unilateral act fulfils its essential element and conditions, the disposer may not revoke it, unless the law provides otherwise.

Article (242) Unless the law provides otherwise, if the unilateral act is: 1. A transfer of ownership, its effect shall not be established for the person to whom the disposition is made except by their acceptance. 2. A waiver that has the meaning of a transfer of ownership or a release from a debt; its effect shall be established for the person to whom the disposition is made unless they reject it in the session (majlis). 3. A pure waiver, its effect shall be established for the person to whom the disposition is made and shall not be reversed by their rejection.

Article (243) A promise is what a person imposes on themselves for another to be performed in the future, not by way of an obligation in property. It may concern a contract or an act, and the promisor is bound by their promise unless they die, become bankrupt, or become insolvent.

Article (244) 1. Whoever makes a promise to the public of a prize to be given for a specific act and sets a time limit therefor, shall be bound to give the prize to whoever performs this act in

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 58 accordance with the announced conditions, even if they performed it without regard to the promise of the prize. 2. If the promisor does not set a time limit for the performance of the act, they may revoke their promise by a public announcement, provided that this does not affect the right of any person who has completed the act before the revocation of the promise. No claim for the prize shall be heard after the…

Article (245) 1. Subject to the provisions on liability contained in special legislations, the provisions of this Chapter shall apply to the liability arising from a harmful act committed by a natural or legal person. 2. Civil liability shall not prejudice criminal liability when its conditions are met, and the penalty shall have no effect on determining the scope of civil liability and assessing the compensation.

Article (246) Every act causing harm to another shall obligate its perpetrator to compensate for the damage, even if the perpetrator lacks discernment.

Article (247) 1. Harm may be caused directly or by causation. 2. If the harm occurs directly, a guarantee is due without any condition. If it occurs by causation, no guarantee is due unless the perpetrator was a transgressor or acted intentionally, or the act led to the harm. 3. If both the direct actor and the cause combine, the ruling is attributed to the direct actor.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 59 4. If one person deceives another, they shall be jointly liable for the harm resulting from that deception.

Article (248) A person whose property has been destroyed by someone is not entitled to destroy the property of that person; otherwise, each of them shall be liable for what they have destroyed.

Article (249) If a person proves that the harm arose from an external cause beyond their control, such as an act of God, a sudden accident, force majeure, the act of a third party, or the act of the injured party, they shall not be liable for compensation, unless the law or the agreement provides otherwise.

Article (250) A person who causes harm while acting in lawful self-defence of their person, honour, or property, or of the person, honor, or property of another, shall not be liable for such harm, provided that they do not exceed the necessary limits; otherwise, they shall be liable for compensation to the extent deemed appropriate by the court.

Article (251) 1. An act shall be attributed to its perpetrator, not to the person who ordered it, unless the perpetrator was compelled. In factual acts, only irresistible coercion is legally relevant. 2. A public official or a person of similar status shall not be liable for an act that harms another if they performed it in implementation of a law or an order issued by their superior, provided that obedience was mandatory or they believed it to be so, and they provide evidence for their belief in the lawfulness of the act, and that their belief was based on reasonable grounds, and that they acted with due care and caution. In this case, the court shall award compensation against the person h…

Article (252) Whoever causes harm to another to avert a greater imminent harm threatening them or another shall not be liable for compensation except to the extent deemed appropriate by the court, taking into account the requirements of justice.

Article (253) 1. If there are multiple persons responsible for the harm, each shall be liable in proportion to their share therein, and the court may rule that they be liable equally or jointly and severally. 2. The court may reduce the amount of compensation or not award it at all if the injured party contributed by their act to causing the harm or aggravated it.

Article (254) 1. Liability shall include moral harm. An infringement on another's freedom, honor, reputation, social standing, or financial status shall constitute moral harm. 2. Compensation may be awarded to spouses and relatives up to the second degree for the moral harm suffered as a result of the incapacity or death of the injured person. 3. The right to claim compensation for moral harm shall not be transferred to another unless its value has been determined by an agreement or a final judicial judgment.

Article (255) In all cases, compensation shall be assessed based on the extent of the loss suffered by the injured party and the loss of their profit, provided that this is a natural consequence of the harmful act.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 61

Article (256) 1. Compensation shall be assessed in cash. 2. The court may, depending on the circumstances and upon the request of the injured party, where damage has occurred, order the restoration of the status quo ante, or order the performance of a specific matter related to the harmful act, by way of compensation. 3. The compensation may be awarded in installments or in the form of a periodic income. In these two cases, the court may compel the debtor to provide security to be assessed thereby, or an acceptable guarantee. The court may reconsider the assessment of installment-based compensation or the periodic income depending on the change in circumstances and prices to provide full com…

Article (257) Any condition providing for exemption or mitigation of liability arising from a harmful act shall be void. However, it shall be permissible to stipulate an aggravation of this liability, unless the law provides otherwise.

Article (258) 1. A claim for compensation arising from a harmful act shall not be admissible after the lapse of three (3) years from the day the injured party became aware of the occurrence of the damage and of the person responsible for it. 2. If the claim for compensation arises from a crime and the criminal action remains admissible after the lapse of the period mentioned in Paragraph (1) of this Article, the period for hearing the claim for compensation shall not commence except upon the termination of the criminal action.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 62 3. In all cases, a claim for compensation shall not be admissible after the…

Article (259) 1. Compensation shall be required for bodily harm inflicted upon the person. 2. In cases where blood money (Diyah) or Arsh is due, the court may, upon the request of the injured party, award compensation if the death or injury results in material and moral harm not covered by the blood money (Diyah) or Arsh. Second: Destruction of Property

Article (260) 1. Without prejudice to the provision of Article (265) of this Law, if a person, even if they lack discernment, destroys or damages the property of another, they shall be liable for its equivalent if it is a fungible and its value if it is a non-fungible, taking into account the general provisions for compensation. 2. If the destruction is partial, the destroyer shall be liable for the diminution in value. If such diminution is substantial, the owner of the property shall have the option either to accept compensation for the diminution or to abandon the damaged property and take its value, taking into account the general provisions for compensation. 3. If a person destroys the…

Article (261) 1. Liability attaches to the possession of property taken until it is returned. 2. Whoever usurps property belonging to another shall be obligated to return it to them in the condition it was in at the time of usurpation and at the place where usurpation

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 63 occurred. If the property is consumed, destroyed, lost, or damaged as a result of their trespass or without any trespass on their part, they shall be liable to return the equivalent thereof or its value assessed as of the day and place of usurpation. They shall also be liable for its benefits and accretions. 3. If a third party destroys t…

Article (262) 1. If the usurped property changes naturally without intervention, the party from whom it was usurped has the option between recovering the usurped property or its substitute.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 64 2. If the usurped property undergoes a transformation such that it becomes a different thing, the usurper shall be liable for its substitute. 3. If the usurped property is altered by an addition made by the usurper from their own property, the party from whom it was usurped shall have the choice between paying the value of the addition and recovering the usurped property in kind, or holding the usurper liable for it…

Article (263) Anything equivalent to usurpation is governed by the same rules as usurpation.

Article (264) 1. Whoever holds property held in trust (Amanah) thereafter commits usurpation thereof, disposes of it by way of trespass, or withholds it from its owner without right, finds it while its owner is unknown, or dies while its owner remains unknown, shall be liable for it by equivalent if it is a fungible, or by value if it is a non-fungible, as the case may be. 2. Whoever finds an item dropped on the road and takes it as their own, shall be obligated to return it to its owner if it still exists, or to return its equivalent or value if they have consumed it, even if such consumption occurred under compulsion. Part Three Liability for the Acts of Others

Article (265) 1. Anyone who is legally or contractually obligated to supervise a person in need of supervision because they are a minor or due to their mental or physical condition shall be liable for any damage caused by that person to another by their harmful act. 2. Supervision is required for a minor from their guardian or custodian if they have not reached the age of majority. Supervision over the minor is transferred to their teacher at

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 65 school or the supervisor of a craft, as long as the minor is under the supervision of the teacher or supervisor. Supervision over a minor wife is transferred to h…

Article (266) 1. A principal shall be liable for the harm resulting from a harmful act committed by their subordinate, when it is committed by them in the performance of their duty or because of it. 2. The relationship of subordination exists, even if the principal is not free to choose their subordinate, when the principal has actual authority over them in supervision and direction.

Article (267) The person liable for the act of another, whether a supervisor or a principal, has the right of recourse against the person who caused the harm to the extent that this other person is liable for compensation. Part Four Liability of the Guardian of Things, Animals, and Buildings

Article (268) The guardian of a thing is any person who, whether personally or through another, exercises actual control over it. The owner of the thing shall be presumed to be its guardian, unless evidence is provided that guardianship has passed to another.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 66

Article (269) The guardian of an animal, even if not its owner, is liable for any harm caused by the animal, unless the guardian proves that the incident occurred due to an external cause for which they are not responsible.

Article (270) The guardian of a building, even if not its owner, is liable for the harm caused by the collapse of the building, even if it is a partial collapse, unless it is proven that the harm was due to an external cause for which they are not responsible or that the incident is not attributable to negligence in maintenance, old age of the building, or a defect in it.

Article (271) Whoever has under their control things that require special care to prevent their harm, or mechanical machinery, shall be liable for the harm caused by these things or machinery, except for what cannot be prevented, without prejudice to what is provided in this regard in special provisions.

Article (272) Anyone threatened with harm arising from a building, animal, mechanical machinery, or things whose guardianship requires special care may require their guardian or owner take the necessary measures to avert the danger. If such measures are not taken within an appropriate time, they may request the court for authorization to take those measures at the expense of the guardian or owner. In case of urgency, they may take the necessary measures to avert the danger at their expense without obtaining prior authorization from the court. In all cases, the court shall assess whether a state of urgency exists and shall determine the necessary expenses to avert the danger.

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Article (273) The use of public utilities is a right subject to the safety of others. Whoever uses this right and causes damage that could have been averted, shall be liable. Chapter Four Beneficial Acts Part One Unjust Enrichment

Article (274) 1. No one may take the property of another without a lawful ground. If they take it, they shall return it and shall be liable for its benefits and accretions. 2. Whoever acquires property from another without an acquisitive juridical act shall be obligated to return it if it remains in existence, or restore its equivalent or its value if it no longer exists, unless the law provides otherwise. 3. If a property leaves a person’s possession without intent and becomes attached to the property of another due to a cause attributable to neither party, in such a manner where separation is not possible without causing harm to either owner, the lesser in value shall accede to the greater…

Article (275) 1. Whoever receives, by way of performance, what is undue to them shall be bound to make restitution thereof if it remains in existence, or to restore its equivalent or its value if it is no longer in existence.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 68 2. No restitution shall be due if the person who made the performance knew that they were paying what was not due, unless they were of limited legal capacity or were coerced into this performance.

Article (276) Restitution of the undue shall be permitted if performance has been made in fulfilment of an obligation whose cause has not been realized, or of an obligation whose cause has ceased after having been realized, or if the performance was in fulfilment of an obligation whose term has not yet fallen due and the performer was unaware of the existence of the term.

Article (277) No restitution of the undue may be claimed from the creditor if the performance was made by a person other than the debtor and it resulted in the creditor, acting in good faith, having divested themself of the instrument evidencing the debt, or of the securities obtained therefor, or having abandoned their claim against the true debtor until the period specified for its hearing has lapsed. In such case, the third party who made performance may have recourse against the true debtor for the debt and for compensation, where applicable.

Article (278) 1. Where the recipient of an undue is acting in good faith, they shall only be bound to return what they received. If they refuse to make restitution, they shall be bound to return what they have received, together with any gains or personal benefits they have derived therefrom, as well as what they failed to derive from the thing they received, as from the date of filing the claim for restitution. 2. Where the recipient of an undue is acting in bad faith, they shall be bound to return what they received, together with any gains or personal benefits they have derived therefrom, as well as what they failed to derive from the thing they received without right, as from the date of…

Article (279) If the person who received what is undue lacks contractual capacity, they shall be bound only to the extent of the enrichment thereby obtained. Part Three Negotiorum Gestio (Fadalah)

Article (280) Negotiorum gestio (Fadalah) is when a person voluntarily undertakes the performance of a beneficial act for another, without being ordered thereby, authorized by the court, required by necessity, or established by custom, and without being legally bound thereto.

Article (281) Negotiorum gestio (Fadalah) is established even if the negotiorum gestor, while managing their own affair, also manages the affair of another, due to a connection between the two affairs that makes it impossible to carry out either of them separately from the other.

Article (282) The rules governing agency shall apply if the principal ratifies the acts performed by the negotiorum gestor.

Article (283) The negotiorum gestor shall continue the work they have begun until the principal is able undertake it personally. The negotiorum gestor shall also notify the principal of their intervention as soon as they are able to do so.

Article (284) 1. The negotiorum gestor shall exercise, in the performance of the work, the care of an ordinary person and shall be liable for their fault. However, the court may reduce compensation arising from such fault if there is justification for it.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 70 2. If the negotiorum gestor entrusts another with all or part of the work, they shall be liable for the actions of their delegate, without prejudice to the principal's right of direct recourse against the delegate. 3. If several negotiorum gestors jointly undertake a single act, they shall be jointly and severally liable. 4. The negotiorum gestor shal…

Article (285) 1. The principal shall be bound to perform the obligations undertaken by the negotiorum gestor on their behalf, to reimburse them for the obligations they have assumed, to refund them for the necessary and beneficial expenses justified by the circumstances, and to compensate them for any damage they have suffered due to carrying out the work. 2. A negotiorum gestor is not entitled to remuneration for their work unless it forms part of their professional activities.

Article (286) 1. If the negotiorum gestor dies, their heirs shall be bound by the same obligations binding the heirs of an agent upon termination of agency by the agent's death. 2. If the principal dies, the negotiorum gestor remains bound toward the heirs by the obligations to which they were bound toward their decedent. Part Four Payment of Another's Debt

Article (287) Whoever pays the debt of another at that person’s order shall have the right of recourse against the person who gave the order for what they have paid on their behalf, and shall legally substituted for the original creditor in claiming the debt, whether they stipulated the right of recourse or not.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 71

Article (288) Whoever pays the debt of another without that person’s order shall have no right of recourse against the debtor for what they have paid, unless authorized by the court, required by necessity, or it is customary that they act as the debtor’s representative. They shall have no right of recourse against the creditor unless the creditor has discharged the debtor from the debt, even after recovering their debt from the payer.

Article (289) If a mortgagor pays the debt of another in order to release their property that was mortgaged as security for this debt, they shall have the right of recourse against the debtor for what they have paid. Part Five Barring of a Claim Arising from a Beneficial Act

Article (290) 1. No claim arising from a beneficial act shall be admissible after the lapse of three (3) years from the day on which the creditor became aware of their right of recourse. 2. In all cases, no claim shall be admissible after the lapse of fifteen (15) years from the day on which the right of recourse arose. Chapter Five The Law

Article (291) Obligations that arise directly from the law shall be governed by the legal provisions that created them.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 72 Section Two Effects of the Obligation Chapter One General Provisions

Article (292) The debtor shall perform their obligation upon its maturity once its legal conditions are met. If the debtor refuses, performance shall be compelled against them.

Article (293) 1. Performance shall be voluntary if effected by payment or by its equivalent. 2. Performance shall be compulsory if effected in kind or by way of compensation.

Article (294) If a right lacks legal protection for any reason, it shall not be subject to compulsory enforcement and shall become a natural obligation incumbent upon the debtor. If the debtor voluntarily performs it, such performance shall be valid and shall not be regarded as a donation, an undue payment, or performance of an obligation that is not due. Chapter Two Means of Performance Part One Voluntary Performance First: Parties to Performance 1. The Party Effecting Performance

Article (295) 1. Subject to the provisions of Article (332) of this Law, performance may validly be effected by the debtor, their representative, or a third party. 2. The creditor may refuse performance by a third party if the debtor objects thereto and notifies the creditor of such objection.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 73

Article (296) For performance to be valid, the person effecting it shall be the owner of what is given in performance and shall have the legal capacity to dispose thereof. If the performer effecting the performance of the obligation lacks the capacity to dispose, the performance shall be deemed invalid, unless it causes harm to them.

Article (297) Performance made to some creditors shall not be effective as against the other creditors if the debtor has been interdicted for debt and performance is made out of the interdicted property, or if the debtor is suffering from death-illness, and the performance is prejudicial to the remaining creditors. 2. The Person to Whom Performance is Made

Article (298) Performance shall be made to the creditor or their representative. A person who presents to the debtor a receipt issued by the creditor shall be deemed to have capacity to receive the debt, unless it has been agreed that performance is to be made to the creditor personally.

Article (299) If the creditor lacks or has limited legal capacity, the debtor's liability shall be discharged only by performance made to the creditor’s guardian. If payment is nevertheless made to the creditor and the thing given in performance is lost or perishes while in their possession, their guardian shall be entitled to claim the debt from the debtor. Second: Refusal of Performance

Article (300) If the creditor, without justification, refuses to accept a duly offered performance, or declares that they will not accept performance, the debtor shall put the creditor in default, and shall grant them a reasonable period within which the creditor shall fulfil their part to receive their right.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 74

Article (301) Once the creditor has been put in default, they shall bear the risk of loss of the subject matter of the obligation. The debtor shall have the right, with the court's permission, to deposit it at the creditor's expense, and to claim compensation for any harm they have suffered.

Article (302) If the subject matter of performance is a specific thing determined by its identity, and shall be delivered at the place where it is located, the debtor may, after putting the creditor in default, obtain permission from the court to deposit it. If this thing is immovable property or a thing intended to remain where it is, the debtor may request that it be placed under judicial sequestration.

Article (303) If the subject matter of the performance is a perishable thing, or risks losing its value, or entails excessive expenses for its deposit or custody, the debtor may, after obtaining the court's permission, or if it is not possible to obtain such permission in due time, sell it at the prevailing price of the like. If this is not possible, it may be sold by public auction. The creditor's right shall transfer from the thing to its price, and the deposit of the price shall substitute the deposit of the thing itself.

Article (304) A deposit, or an equivalent measure, shall be permissible if the debtor is unaware of the creditor's identity or domicile, if the creditor lacks or has limited legal capacity and has no representative to accept performance on their behalf, if the debt is disputed among several persons, or if there are other serious reasons justifying such measure.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 75

Article (305) A formal offer of performance made by the debtor shall be equivalent to performance if it is followed by a deposit that complies with its legal requirements or by any similar measure, provided it is accepted by the creditor or validated by a final judgment.

Article (306) 1. If the debtor makes an offer of performance and follows it with a deposit or a similar measure, they may withdraw this offer as long as the creditor has not accepted it, and no final judgment has been issued validating it. If the debtor withdraws the offer, the obligation of co-debtors and guarantors shall not be discharged. 2. If the debtor withdraws the offer after it has been accepted by the creditor or after it has been validated by a judgment, and the creditor accepts this withdrawal, the creditor may no longer rely on the security for the debt, and the liability of the co-debtors and guarantors shall be discharged. Third: Subject Matter, Time, Place, Expenses, and Proo…

Article (307) 1. If the debt is a thing determined by designation, the debtor may not perform by delivering another thing in substitution thereof without the creditor's consent, even if this substitute is of equal or higher value than the thing due. 2. If the debt is a thing not determined by designation, the debtor may perform by delivering its equivalent, even without the creditor’s consent.

Article (308) 1. The creditor shall not be compelled to accept partial performance of their right, unless the law or the agreement so provides. 2. If part of the debt is in dispute and the creditor accepts receipt of the acknowledged part, the debtor may not refuse performance of that part.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 76

Article (309) If the debtor is obliged to pay any expenses in addition to the debt, and the amount paid is insufficient to cover both the debt and those expenses, the amount paid shall be applied first to the expenses and then to the principal debt, unless otherwise agreed.

Article (310) 1. If several debts, of the same kind, are owed by the debtor to a single creditor, and the amount paid is insufficient to discharge them all, the debtor may, at the time of performance, designate the debt they intend to discharge, unless prevented by law or agreement. 2. If the debt is not designated in the manner set out in Paragraph (1) of this Article, payment shall be applied to the debt that has fallen due. If several debts have fallen due, it shall be applied to the debt most onerous to the debtor. If the debts are equally onerous, payment shall be applied to the debt designated by the creditor.

Article (311) 1. Performance shall be due immediately once the obligation has become definitively established in the debtor's liability, unless the law or the agreement provides otherwise. 2. In exceptional cases, and unless prohibited by law, the court may grant the debtor a reasonable time or allow performance by installments, if the debtor’s circumstances so require, and such deferment does not cause serious harm to the creditor.

Article (312) 1. If the subject matter of the obligation is determined by designation, it shall be delivered at the place where it was located at the time the obligation arose, unless the law or the agreement provides otherwise. 2. In other obligations, performance shall be at the place of the debtor's domicile at the time of performance, or at the place of the debtor's principal place of business if the obligation is related to such business.

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Article (313) 1. If the debtor sends the debt with their messenger to the creditor and it perishes in the messenger's possession before arrival, the loss of the debt shall be borne by the debtor. 2. If the creditor instructs the debtor to pay the debt to the creditor's messenger and the debtor does so, the loss of the debt shall be borne by the creditor, and the debtor shall be discharged from the debt.

Article (314) The expenses of performance shall be borne by the debtor, unless the law or the agreement provides otherwise.

Article (315) 1. A person who has performed a debt in whole or in part may request a receipt for what they have performed. 2. If the creditor refuses to deliver the debtor such receipt, the debtor may deposit the thing due by judicial deposit. Part Two Performance by Equivalent First: Performance by Consideration (Datio in Solutum)

Article (316) A debt may be discharged by consideration, as agreed upon by the parties to the contract, and such agreement shall be subject to the general provisions governing contracts provided for in this Law.

Article (317) The provisions governing sale shall apply to performance by consideration if the consideration consists of a specific thing given in the discharge of the debt. The provisions governing performance in discharge of a debt shall also apply.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 78

Article (318) The original debt, together with its securities, shall be extinguished by the performance by consideration, and the right of the creditor shall be transferred to the thing given in substitution. Second: Set-off

Article (319) Set-off is the extinguishment of a debt owed by one party to another by means of a debt owed by the latter to the former. It is either legal, taking effect by operation of law; contractual, effected by agreement of the parties; or judicial, effected by a judgment or order of the court.

Article (320) The following conditions are required for a legal set-off: 1. Both parties shall be both creditor and debtor of the other. 2. The two debts shall be identical in kind, description, maturity, and strength or weakness. 3. Its implementation shall not prejudice the rights of third parties, whether the cause of the two debts is the same or different.

Article (321) Legal set-off shall not take effect by operation of law in the following cases: 1. If one of the two debts consists of a thing that has been unlawfully taken from the possession of its owner and is required to be returned. 2. If one of the two debts consists of a thing that has been deposited or lent for use. 3. If the right of one of the creditors is not subject to attachment. 4. If one of the two debts is a claim for compensation for bodily injury.

Article (322) Contractual set-off shall be effected by agreement of the parties if any of the conditions for legal set-off is not met.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 79

Article (323) Judicial set-off shall be effected by a judgment or order of the court if its conditions are met and upon an original or incidental claim.

Article (324) 1. Judicial set-off shall take effect upon the request of the interested party, and may not validly be waived before the right thereto is established. 2. Set-off results in the extinction of the two debts to the extent of the lesser amount, from the time they become eligible for set-off. 3. If the debtor has multiple debts, the designation of set-off shall follow the same rules as the designation of payment.

Article (325) If a debt is time-barred at the time set-off is invoked, this shall not prevent the set-off from taking effect, provided that the period barring the action had not been completed at the time the set-off became possible.

Article (326) If a debtor pays a debt against which they could have claimed set-off, they may not invoke the securities for that right to the detriment of a third party unless they were unaware of its existence and had a valid excuse for their ignorance.

Article (327) A set-off may not take effect to the detriment of rights acquired by a third party.

Article (328) If a third party effects an attachment against the debtor, and the debtor subsequently becomes a creditor of their creditor, they may not invoke set-off to the detriment of the attaching party.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 80 Third: Merger of Patrimonies (Confusion)

Article (329) 1. When the capacities of creditor and debtor in respect of the same debt are united in one person, the debt is extinguished to the extent of such merger. 2. If the creditor is an heir of the debtor, there shall be no merger of patrimonies; rather, the creditor shall stand, like the other creditors, in claiming their debt from the estate.

Article (330) If the cause that led to the merger of patrimonies ceases, and such cessation has a retroactive effect, the debt and its accessories shall be reinstated with respect to all persons concerned. Part Three Compulsory Performance First: Specific Performance

Article (331) 1. After being put in default, the debtor shall be compelled to perform their obligation by specific performance, whenever this is possible. 2. If specific performance would be excessively onerous for the debtor, the court may, upon the debtor's request, limit the creditor's right to monetary compensation, so long as no substantial prejudice is thereby caused to the creditor.

Article (332) 1. If the subject of the right is an act, and its nature or the terms of the agreement require the debtor to perform it in person, the creditor may refuse performance by any other person. 2. If the debtor fails to perform the act, the creditor may request the court's authorization to have it performed, and may also perform it without permission in case of necessity. In both cases, the performance shall be at the debtor's expense. 3. The court's judgment shall take the place of performance if the subject of the right is an act, and its nature so permits.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 81

Article (333) If specific performance has been effected, or if the debtor persists in refusing performance, the court shall determine the amount of compensation to be borne by the debtor, taking into account the damage suffered by the creditor and the obstinacy exhibited by the debtor.

Article (334) 1. If the debtor is required to preserve a thing, to manage it, or to exercise care in the performance of their obligation, they shall have fulfilled the obligation if they exert in its performance all the care of an ordinary person, even if the intended result is not achieved, unless the law or the agreement provides otherwise. 2. In all cases, the debtor remains liable for fraud or gross fault.

Article (335) If the subject matter of the right is an obligation to refrain from an act and the debtor breaches it, the creditor may request the removal of what has been done in violation thereof, or may request the court’s authorization to carry out such removal at the debtor's expense. Second: Performance by Way of Compensation

Article (336) If it becomes impossible for the debtor to effect specific performance of the obligation, they shall be ordered to pay compensation for failure to perform the obligation, unless they prove that the impossibility of performance arose from a foreign cause beyond their control. The same ruling shall apply if the debtor delays performance of the obligation or performs it partially or defectively.

Article (337) Compensation shall not be due unless the debtor has been formally put in default, except when the law or the agreement provides otherwise.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 82

Article (338) Notice to the debtor is not required in the following cases: 1. If the performance of the obligation becomes impossible or futile due to the debtor’s act. 2. If the subject of the obligation is compensation arising from an unlawful act. 3. If the subject of the obligation is the return of a thing known by the debtor to be stolen, or a thing they received without right, with knowledge thereof. 4. If the debtor declares in writing that they do not intend to perform their obligation.

Article (339) If the compensation is not determined in the law or in the contract, the court shall assess it in an amount equivalent to the damage actually sustained.

Article (340) 1. The contracting parties may pre-determine the amount of compensation by stipulating it in the contract or in a subsequent agreement, subject to the provisions of the law. 2. The court may reduce the amount of agreed compensation if the debtor proves that the assessment was excessive or that the original obligation has been partially performed. 3. The court may reduce the amount of the agreed compensation if the creditor contributed by their own fault to the occurrence of or increase in the damage, or may refrain from awarding compensation if the creditor’s fault predominates over the debtor’s fault. 4. The creditor may claim an amount exceeding the agreed compensation if the…

Article (341) 1. All of the debtor's assets constitute a security for the performance of their debts. 2. All creditors are equal in this security, except those who have a right of priority according to the law. 3. The creditors may agree to determine the order of priority in the satisfaction of debts, provided that this does not conflict with the law. Second: Indirect Action

Article (342) 1. Any creditor, even if their right is not yet due for performance, may exercise, in the name of their debtor, all of the debtor's rights, except those that are strictly personal thereto or not subject to attachment. 2. The creditor's exercise of their debtor's rights shall not be admissible unless they prove that the debtor has failed to exercise those rights and that such failure is likely to lead to their bankruptcy or insolvency, or aggravate their bankruptcy or insolvency. The debtor shall be joined in the claim. 3. The creditor shall be deemed to act as a representative of their debtor in exercising such rights, and any benefit resulting from the exercise of those rights…

Article (343) 1. If the contracting parties conceal a genuine contract by means of an apparent contract, the effective contract as between the contracting parties and their universal successor shall be the genuine contract. 2. If a simulated contract is concluded, the creditors of the contracting parties and their particular successors, when acting in good faith, may rely on the simulated contract; they

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 84 may also rely on the concealed contract and prove, by all means, the simulation of the contract that has caused them harm. 3. If the interests of the concerned persons conflict, and some of them rely on…

Article (344) Any creditor whose right has become due, and whose debtor has made a disposition, may request the court to rule on the non-enforceability of this disposition against them, whenever this disposition diminishes the debtor's rights, increases their obligations, or results in their bankruptcy or insolvency, or aggravates their bankruptcy or insolvency, in the following cases: 1. If the debtor's disposition is for consideration, its non-enforceability as against the creditor is conditional upon the debtor being bankrupt or insolvent and upon the person in whose favor the disposition was made being aware of the debtor's bankruptcy or insolvency. 2. If the debtor's disposition is a gr…

Article (345) If the creditors demand payment of their debts from a debtor whose debts have encompassed all of their property, they may not donate of their property or dispose of it for consideration, even without favouritism. The creditors may request a judgment declaring the non- enforceability of their disposition against them, and they may request the sale of their property and the pro-rata apportionment of its price in accordance with the law.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 85

Article (346) If a creditor claims that a debt encompasses the debtor's property, they shall only prove the amount of the debt owed by the debtor, and the debtor shall prove that they own property exceeding the value of the debt.

Article (347) The recipient of a disposition may avoid a lawsuit for non-enforceability if they deposit the price of the disposed property with the court's treasury in an amount not less than the value of the like.

Article (348) Once the non-enforceability of the disposition has been adjudged, the creditors who are harmed thereby shall benefit therefrom.

Article (349) 1. A lawsuit for non-enforceability of a disposition shall not be heard after the lapse of three (3) years from the day on which the creditor became aware of the reason for the non- enforceability of the disposition. 2. In all cases, a lawsuit for non-enforceability of a disposition shall not be heard after the lapse of fifteen (15) years from the date of the disposition. Fifth: Right of Retention

Article (350) 1. Anyone who is obligated to perform something may withhold performance thereof as long as the creditor has not fulfilled their corresponding obligation that arose from the debtor's obligation and was connected therewith or reciprocal thereto, or as long as the creditor has not provided sufficient security for the performance of their obligation. 2. Whoever has incurred necessary or beneficial expenses on the property of another while it is in their possession may withhold its return until they recover what is due thereto by law, unless the law or the agreement provides otherwise.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 86 3. Eac…

Article (351) 1. The retaining person shall preserve the retained thing and shall render an account of its yield. 2. If the retained thing is at risk of perishing or damage, the retaining person may request permission from the court to sell the retained thing in accordance with the procedures specific to the sale of a possessory pledged, and the right of retention shall transfer from the thing to its price. 3. If the retained thing is perishable or is likely to lose its value such that it is not possible to obtain permission from the court in a timely manner, the retaining person may sell the retained thing at the price of the like, and the right of retention shall transfer from the thing to…

Article (352) Whoever retains a thing in exercise of the right of retention shall have priority over all other ordinary creditors in satisfying their right therefrom.

Article (353) 1. The right of retention shall be extinguished by the retaining person’s recovery of their right from their debtor, by the perishing of the retained thing, or by its departure from the possession of the retaining person, unless the law provides otherwise. 2. The retaining person may, if the thing has left their possession without their knowledge or despite their opposition, request its recovery within thirty (30) days from the date they became aware of its departure from their possession and before the lapse of one year from the date of its departure.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 87 Chapter Three Attributes of the Obli…

Article (354) An obligation shall be conditional if its existence or extinction is made to depend on a future, uncertain event.

Article (355) An obligation shall be void if it is made subject to an impossible condition or a condition that is contrary to public order or public morals.

Article (356) An obligation shall be void if it is made subject to a suspensive condition that makes its existence dependent solely on the will of the obligor.

Article (357) An obligation subject to a suspensive condition shall not be effective until the condition upon which it is suspended is fulfilled. The obligation shall not be enforceable before the fulfilment of the condition, and the creditor may take such measures as are necessary to preserve their right.

Article (358) 1. The fulfilment of a resolutory condition shall result in the extinguishment of the obligation. The debtor shall be bound to return what they have taken; if return is impossible for a reason attributable thereto, they shall be liable for compensation. 2. Acts of management issued by the debtor shall remain effective despite the fulfilment of the resolutory condition.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 88

Article (359) 1. If a condition is fulfilled, its effect shall be retroactive to the time at which the obligation arose, unless it is apparent from the will of the contracting parties or from the nature of the contract that the existence or extinction of the obligation is to take effect only at the time the condition is fulfilled. 2. A condition shall not have a retroactive effect if the performance of the obligation before the fulfillment of the condition was impossible for a reason beyond the debtor’s control. Part Two The Term

Article (360) 1. An obligation shall be for a term if its effectiveness or extinction is made to depend on a future, certain event. 2. An event is considered certain if its occurrence is inevitable, even if the time of its occurrence is unknown.

Article (361) An obligation deferred to a term shall not be effective until the term falls due. The creditor may, before the term falls due, take such measures as are necessary to preserve their right, including requesting security if they fear the debtor's insolvency and base this on a reasonable cause.

Article (362) If it is apparent from the obligation that the debtor will not perform it except upon their ability or ease (maysarah), the court shall set a suitable time for the maturity of the term, taking into account the debtor's current and future resources and what is required by the diligence of a prudent person in performing their obligation. Once their ability to perform is proven, the term shall lapse.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 89

Article (363) 1. If the debt is deferred, the debtor may pay it before the term falls due if the term is for their benefit, and the creditor shall be compelled to accept. 2. If the obligation is deferred and no term for its performance is specified, the court shall determine it at the request of the creditor or the debtor, according to custom and the nature of the transaction. 3. If the debtor pays the debt before the term falls due and then the thing received becomes subject to entitlement in favor of a third party, the debt shall revert to being deferred as it was.

Article (364) If the term is for the benefit of either of the parties, they may waive it by their unilateral will.

Article (365) A deferred debt shall not become due upon the death of the creditor, but it shall become due upon the death of the debtor unless the debt is secured by a real security, or the heirs provide sufficient real or personal security, or the creditor agrees to the debt remaining deferred.

Article (366) The debtor’s right to the term shall lapse in the following cases: 1. If they are adjudged bankrupt, insolvent, or placed under interdiction. 2. If they fail to provide the agreed security for the debt. 3. If the agreed security for the debt is diminished by an act attributable thereto or by a cause beyond their control, unless they promptly complete it.

Article (367) 1. If an obligation is coupled with a suspensive term, it shall not be effective except upon the expiry of the term.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 90 2. The creditor may, even before the expiry of the term, take such measures as are necessary to preserve their rights, and they may demand security if they fear the debtor's bankruptcy or insolvency and base this on a reasonable cause.

Article (368) Upon the expiry of a resolutory term, the obligation shall be extinguished, without such extinguishment having a retroactive effect. Chapter Four Multiplicity of the Subject Matter of the Obligation Part One Alternative Obligation

Article (369) An obligation shall be an alternative if its subject matter includes multiple things, and the debtor is fully discharged by performing one of them. The choice shall belong to the debtor, unless the law or the agreement provides otherwise.

Article (370) 1. If the choice belongs to the debtor and they refrain from choosing, or if there are multiple debtors and they do not agree among themselves, the court may, at the creditor's request, set a time limit for the debtor to designate the subject matter of the obligation. If the term expires without designation, the court shall designate the subject of the obligation. 2. If the choice belongs to the creditor and they refrain from choosing, or if there are multiple creditors and they do not agree among themselves, the court may, at the debtor's request, set a time limit for the creditor to designate the subject matter of the obligation. If the time limit expires without designation,…

Article (371) If the choice belongs to the debtor, and it then becomes impossible for them to perform all of the multiple things that constitute the subject matter of the obligation. The impossibility is attributable thereto, even with respect to one of these things, they shall be bound to pay the value of the last thing the performance of which became impossible. Part Two Facultative Obligation

Article (372) 1. An obligation shall be facultative if its subject matter includes only one thing, but the debtor shall be discharged if they perform another thing in lieu thereof. 2. The original subject matter of the obligation, not the substitute, shall alone constitute the basis of the obligation and shall determine its nature. Chapter Five Multiplicity of Parties to the Obligation Part One Solidarity

Article (373) Solidarity among creditors or among debtors shall not be presumed; rather, shall arise from a provision of law or by agreement. First: Joint and Several of Creditors

Article (374) 1. The joint and several creditors, jointly or severally, may claim the entire debt from the debtor. 2. If one of the joint and several creditors demands performance from the debtor, the debtor may not plead against this creditor defences personal to other creditors, but they may

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 92 plead against the demanding creditor defences personal to this creditor, and defences that are common to all creditors.

Article (375) Whatever one of the joint and several creditors receives from the debt shall be deemed to be the right of all the creditors jointly, and they shall share therein proportionately. The pro rata distribution shall be in equal shares, unless the law or the agreement provides otherwise.

Article (376) If there is solidarity among the creditors, the debtor may pay the debt to any of them, unless one of them has served a notice on the debtor not to pay their share to a specific creditor, provided that no prejudice results to the debtor.

Article (377) If the debtor is discharged from their obligation vis-à-vis one of the joint and several creditors for a reason other than performance, their liability shall not be discharged vis-à-vis the other creditors except to the extent of that creditor's share.

Article (378) If one of the joint and several creditors performs an act that is prejudicial to the other creditors, such act shall not be effective against them.

Article (379) Solidarity among creditors shall not prevent the division of the debt among the heirs of any of them. Solidarity in respect of the entire debt shall pass to each heir in proportion to their share in the estate, unless the debt is indivisible, in which case solidarity shall pass to each heir in respect of the entire debt.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 93 Second: Joint and Several Liability of Debtors

Article (380) Solidarity among debtors shall be established even if the debt of one of them is deferred, or subject to a condition, or associated with a description that affects it, while the debt of the other is immediate or free from such a description.

Article (381) If one of the jointly and severally debtors performs the debt, their liability and that of the other debtors shall be discharged.

Article (382) 1. The creditor may claim their debt from all the joint and several creditors or from any of them, taking into account any attribute affecting their relationship with each debtor that has an effect on the debt, and a claim against one of them shall not preclude a claim against the others. 2. A joint and several debtor may not invoke the defenses personal to other debtors, but they may invoke the defenses personal thereto and the defenses common to all the debtors.

Article (383) 1. If the share of one of the joint and several debtors in the debt is extinguished for a reason other than performance, the debt shall not be extinguished with respect to the other debtors except to the extent of that debtor's share. 2. If the liability merges between the creditor and one of the joint and several debtors, the debt shall not be extinguished with respect to the other debtors except to the extent of the share of the debtor whose liability has merged with that of the creditor.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 94

Article (384) If the creditor agrees with one of the joint and several debtors on performance by consideration (datio in solutum), the liability of the other debtors shall be discharged, unless the creditor has reserved their right against all of them.

Article (385) 1. If the creditor releases one of the joint and several debtors from the debt, their liability and that of the others shall be discharged to the extent of their share, and their solidarity shall remain. 2. If the creditor releases one of the joint and several debtors from the solidarity, their debt shall remain in their liability, and the creditor may not claim against that debtor for the share of the others, and the debtors shall have the right of recourse against that debtor for what they pay on their behalf according to the rule of solidarity between them. 3. If the creditor releases one of the joint and several debtors from the debt in an absolute manner, the release shall…

Article (386) 1. In cases where the creditor releases one of the joint and several debtors, whether the release is from the debt or from the solidarity, the other debtors may have a right of recourse against that debtor for their share in the debt, within the limits of the share of any bankrupt or insolvent among them. 2. If the creditor exempts the debtor they have released from all liability for the debt, the creditor shall bear the share of this debtor in the share of the bankrupt or insolvent debtor.

Article (387) 1. The barring of a claim by the lapse of time with respect to one of the joint and several debtors shall not benefit the other debtors except to the extent of that debtor's share. 2. The creditor may not invoke the suspension or interruption of the lapse of time with respect to one of the joint and several debtors against the other debtors.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 95

Article (388) 1. A joint and several debtor shall be liable for the performance of their obligation for their own act. 2. If the creditor serves a notice on one of the joint and several debtors or institutes legal proceedings against them, this shall have no effect on the other debtors; however, a notice served by one of the joint and several debtors shall benefit the others.

Article (389) 1. If the creditor enters into a settlement with one of the joint and several debtors and the settlement includes a release from the debt or a discharge of liability therefrom by any other means, the other debtors shall benefit from this settlement. 2. If the creditor enters into a settlement with one of the joint and several debtors and this settlement creates a new obligation on the other debtors or increases their obligation, this settlement shall not be effective against them unless they approve it.

Article (390) 1. If one of the joint and several debtors acknowledges the debt, this acknowledgment shall not take effect against the other joint and several debtors. 2. If one of the joint and several debtors refuses to take an oath directed to them by the creditor, or directs the oath to the creditor and the creditor takes it, the other joint and several debtors shall not be prejudiced thereby. 3. If the creditor directs an oath to one of the joint and several debtors and they take it, the other joint and several debtors shall benefit therefrom.

Article (391) If a judgment is rendered in favour of the creditor against one of the joint and several debtors, such judgment shall not be invoked against the others; however, they shall benefit from it if it is rendered in favour of the debtor, unless the judgment is based on a ground personal to that debtor.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 96

Article (392) 1. A joint and several debtor who has performed the debt shall have a right of recourse against any of the others for their respective share. If one of them is bankrupt or insolvent, the performing debtor and the solvent joint and several debtors shall bear the burden of such bankruptcy or insolvency, each in proportion to their share, without prejudice to their right of recourse against the bankrupt or insolvent debtor upon their solvency. 2. The debt, if performed by one of the joint and several debtors, shall be divided into equal shares among all, unless the law or the agreement provides otherwise.

Article (393) If one of the joint and several debtors is the principal debtor and the other debtors are guarantors; they shall have no right of recourse against them for anything after performing the debt. Part Two Joint Debt

Article (394) A debt shall be joint among several creditors if it has a single cause, or if it is a debt devolved by inheritance to several heirs, or consists of consumable joint property, or constitutes the consideration for a loan taken from joint property.

Article (395) 1. Each of the co-creditors in a joint debt may claim their share thereof, and what they receive shall be deemed joint property among all co-creditors, each in proportion to their share. 2. If one of the co-creditors receives their share in the joint debt, the other co-creditors may either share it therewith, each in proportion to their share, and have recourse against the debtor for the remainder, or they may leave what the receiving co-creditor has received to them and have recourse against the debtor for their shares.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 97 3. If the co-creditors choose to pursue the debtor, they may not hav…

Article (396) If one of the co-creditors receives their share in the joint debt and then disposes thereof or consumes it, the other co-creditors may have recourse against them for their shares therein. If it perishes or is destroyed while in their possession without any fault or negligence on their part, they shall not be liable for the shares of their co-creditors therein, and they shall be deemed to have received their share, while the remainder of the debt in the liability of the debtor shall belong to their other co-creditors.

Article (397) If the debtor provides one of the co-creditors with surety for their share in the joint debt, or the debtor assigns them to another, the other co-creditors shall be entitled to share, in proportion to their shares, in the amount received from the surety or from the assignee.

Article (398) If one of the co-creditors, out of their share in a joint debt, purchases property from the debtor, the other co-creditors may require the latter either to indemnify them for the portion of the price corresponding to their respective shares, or to have recourse for their shares against the debtor, and they may share in what has been purchased if they so agree.

Article (399) One of the co-creditors may grant their share in the debt to the debtor or release them therefrom, and they shall not be liable for the shares of their co-creditors in what they granted or released.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 98

Article (400) One of the co-creditors in a joint debt may enter into a settlement for their share therein. If the consideration for the settlement is of the same kind as the debt, the others may either share them in what has been received or pursue the debtor. If the consideration for the settlement is of a different kind, they may pursue the debtor or the settling co-creditor, and the settling co-creditor may pay them their share in what has been received or their share in the debt.

Article (401) 1. No one of the co-creditors in a joint debt may, on their own, defer the debt without the consent of the other co-creditors. 2. However, a co-creditor in a joint debt may defer their share without the consent of the others, and in this case, that co-creditor shall not be entitled to share with them in what they receive from the debt. Part Three Indivisibility of the Obligation

Article (402) An obligation shall be indivisible in the following cases: 1. If its subject matter, by its nature, does not admit division. 2. If it appears from the purpose intended by the contracting parties that the obligation may not be performed in divisible parts.

Article (403) If there are multiple debtors in an indivisible obligation, each shall be bound for the entire debt, and any debtor who has performed the debt shall have the right of recourse against the others, each in proportion to their share, unless otherwise provided by law or agreed upon.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 99

Article (404) 1. If there are multiple creditors in an indivisible obligation, or if the heirs of a creditor in such obligation are multiple, each creditor or heir may demand the performance of the entire obligation. 2. If one of the creditors or heirs objects, the debtor shall perform the obligation thereto jointly or deposit the subject matter of the obligation with the competent authority in accordance with the law. 3. Each of the creditors shall have a right of recourse against the creditor who has received performance of the obligation, each in proportion to their share. Part Four Transfer of the Obligation First: Assignment of Right

Article (405) A creditor may assign their right to another person, unless this is precluded by a provision of law, the agreement of the contracting parties, or the nature of the obligation. The validity of the assignment shall not be conditional upon the debtor’s consent.

Article (406) A right may only be assigned to the extent that such right is capable of attachment.

Article (407) An assignment of right shall not be enforceable against the debtor or a third party unless it is accepted by the debtor or notified thereto. However, its enforceability against a third party by the debtor's acceptance requires that such acceptance be of a fixed date.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 100

Article (408) The assignee creditor may, before the notification of the assignment of the right or its acceptance, take such measures as are necessary to preserve the right that has been transferred thereto.

Article (409) An assignment of a right includes its securities, such as suretyship, privilege, and pledge, and is also considered to include any instalments that have fallen due.

Article (410) The assignor shall deliver to the assignee the instrument of the assigned right and all data or means necessary to enable them to exercise their right.

Article (411) 1. If the assignment of right is for consideration, the assignor shall warrant only the existence of the assigned right at the time of the assignment, unless otherwise agreed. 2. If the assignment of right is without consideration, the assignor shall not warrant even the existence of the right.

Article (412) 1. The assignor shall not warrant the solvency of the debtor, unless there is a specific agreement for this warranty. 2. If the assignor warrants the solvency of the debtor, this warranty shall extend only to the solvency at the time of the assignment, unless otherwise agreed.

Article (413) If the assignee has recourse against the assignor for the warranty under Articles (411) and (412), the assignor is only liable to return what they received along with expenses, even if otherwise agreed. However, the assignor shall be liable, if they knew of the non-existence of

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 101 the right in the debtor's liability, to compensate the bona fide assignee for the damage they have suffered.

Article (414) The assignor shall be liable to compensate the assignee for the damage sustained due to their personal acts, even if the assignment was gratuitous, and any condition to the contrary shall be void.

Article (415) The debtor may plead, as against the assignee, the defences that they could have raised against the assignor at the time the assignment of right became effective against them, and they may also plead defences arising from the assignment contract.

Article (416) If multiple assignments are made for the same right, the assignment that first becomes effective against third parties shall prevail.

Article (417) If an attachment is levied on the assignee before the assignment of the right becomes effective against third parties, the assignment shall, as against the attaching creditor, be deemed equivalent to a further attachment. If a subsequent attachment is levied after the assignment has become effective against a third party, the debt shall be distributed among the prior attaching creditor, the assignee, and the subsequent attaching creditor on a pari passu basis, provided that the assignee shall be satisfied, out of the share of the subsequent attaching creditor, to the extent necessary to complete the value of the assignment.

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Article (418) 1. A debtor may transfer their obligation to another person, unless this is precluded by a provision of law, the agreement of the contracting parties, or the nature of the obligation. 2. An assignment of debt shall not be concluded except with the consent of both the assignee and the creditor.

Article (419) 1. If the creditor accepts the assignment, the liability of the original debtor shall be discharged as against the creditor, and the debt shall be transferred to the liability of the assignee. 2. If the creditor expressly or implicitly refuses to accept the assignment, the liability of the original debtor shall not be discharged. 3. If the assignee or the original debtor notifies the creditor of the assignment and gives them a reasonable period to approve the assignment, and the period expires without approval, the creditor's silence shall be deemed a refusal of the assignment.

Article (420) 1. The original debtor shall have the right to require the assignee to perform payment to the creditor, unless otherwise agreed. 2. The assignee may refrain from performing the debt to the creditor if the original debtor has not performed what they undertook towards the assignee under the assignment contract.

Article (421) 1. The assigned debt shall retain its securities, notwithstanding any change in the person of the debtor. 2. A guarantor, whether real or personal, does not remain bound to the creditor unless the guarantor has consented to the assignment.

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Article (422) The original debtor warrants the solvency of the assignee at the time of the creditor's approval of the assignment, unless otherwise agreed.

Article (423) The assignee may plead against the creditor the defences that the original debtor could have raised, and may also plead defences arising from the assignment contract.

Article (424) 1. The sale of a mortgaged property by a registered mortgage shall not entail the transfer of the debt secured by the mortgage to the liability of the purchaser, unless there is an agreement to that effect. 2. If the seller and the purchaser agree to assign the debt, the consent of the mortgagee creditor shall be obtained before the registration of the sale contract, unless the special legislations provide otherwise. Chapter Six Extinction of the Obligation Part One Release

Article (425) An obligation shall be extinguished if the creditor voluntarily releases their debtor. The release shall be effected when it comes to the knowledge of the debtor, and shall be revoked by the debtor's rejection thereof. If the debtor dies before acceptance, the debt shall not be taken from their estate.

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Article (426) A release shall not be valid except for an existing debt and shall not be permissible for a future debt.

Article (427) 1. The substantive provisions that apply to every donation shall apply to a release. 2. No special form shall be required for a release, even if it relates to an obligation arising from a disposition for which a form is required by law or agreed upon by the contracting parties. Part Two Impossibility of Performance

Article (428) An obligation shall be extinguished if the debtor proves that performance has become impossible for them due to a foreign cause beyond their control. Part Three Barring of a Claim by the Lapse of Time

Article (429) A right shall not be extinguished by the lapse of time, but a claim thereon shall not be admissible against a denier upon the lapse of fifteen (15) years without an accepted excuse, except for the cases where the law specifies another period and the cases stipulated in this Law.

Article (430) 1. A claim for any periodic recurring right shall not be admissible against a denier upon the lapse of five (5) years without an accepted excuse. 2. A claim for the due quarter against a holder in bad faith shall not be admissible against a denier upon the lapse of fifteen (15) years without an accepted excuse.

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Article (431) A claim shall not be admissible upon denial after the lapse of three (3) years without an acceptable excuse for the following rights: 1. The rights of physicians, pharmacists, lawyers, engineers, experts, professors, teachers, and brokers, provided that these rights are due to them for their professional work and incurred expenses. 2. Amounts due to be refunded in respect of taxes and duties paid unduly, without prejudice to the provisions contained in special laws.

Article (432) A claim shall not be admissible upon denial after the lapse of two (2) years without an acceptable excuse for the following rights: 1. The rights of merchants and manufacturers for items supplied to persons who do not trade in such items, and the rights of hotel and restaurant owners for the cost of accommodation and food and for all they have spent on behalf of their customers. 2. The rights of workers, servants, and employees for daily and non-daily wages and for the price of supplies they have provided.

Article (433) 1. The claim shall not be admissible in the cases mentioned in Article (432) of this Law, even if the creditors continue to perform other work for the debtor. 2. If an acknowledgment or instrument is made out for any of the rights stipulated in Articles (430), (431), and (432) of this Law, the claim thereon shall not be heard if a period of fifteen (15) years has elapsed since its date of maturity.

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Article (434) The period prescribed for the barring of a claim by the lapse of time shall commence from the day on which the right becomes due for performance, from the time of the fulfilment of the condition if it is subject to a condition, and from the time of the establishment of the entitlement in a claim for warranty of entitlement.

Article (435) A claim shall not be admissible if it is left unpursued by a predecessor then by a successor after them and the total of the two periods reaches the period prescribed for the non-hearing thereof.

Article (436) The period that bars a claim shall be calculated in days, and the first day shall not be counted. The period shall be completed upon the expiry of the last day thereof, unless it is an official holiday, in which case it shall extend to the following day.

Article (437) 1. The lapse of time barring a claim shall be suspended whenever there is an acceptable excuse that makes it impossible to claim the right, and the period during which such impediment exists shall not be counted in the prescribed period. 2. The lapse of time barring a claim shall be suspended in respect of a person who lacks legal capacity, or an absent or missing person, or in respect of any person prevented from disposing of their property by law or a judicial judgment, unless any of them has a legal representative.

Article (438) If some of the heirs do not file a claim related to the right of their decedent within the period prescribed for it to be admissible, and the remaining heirs have an acceptable excuse, the claim of the latter shall be heard to the extent of their respective shares.

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Article (439) An express or implied acknowledgment by the debtor of the right shall interrupt the lapse of time prescribed for the barring of a claim.

Article (440) The period prescribed for the barring of a claim shall be interrupted by a judicial claim or by any judicial proceeding taken by the creditor to assert their right.

Article (441) 1. If the period prescribed for the barring of a claim is interrupted, a new period, equal to the original period, shall commence. 2. If a judgment is rendered for the debt and the judgment has acquired the force of res judicata, or if the debt is of a kind in respect of which a claim is barred after one year and the period is interrupted by the debtor's acknowledgment, the new period for the barring of the claim shall be fifteen (15) years, unless the debt for which judgment is rendered includes periodic recurring obligations that do not fall due for performance until after the judgment is issued.

Article (442) The barring of a claim in respect of a right by the lapse of time entails the barring of a claim relating to its accessories, even if the period prescribed for the barring of a claim for these accessories has not been completed.

Article (443) 1. A waiver of the defense of the barring of a claim by the lapse of time shall not be valid before the right to invoke such defense is established, nor may it be agreed that a claim shall not be admissible after a period other than that specified by law. 2. Any person who has the capacity to dispose of their rights may expressly or impliedly waive the defense after the right to invoke it has been established, provided that such waiver shall not be enforceable against creditors if it is made to their detriment.

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Article (444) 1. The court may not rule on its own motion on the non-admissibility of a claim; such ruling shall be made only upon a request by the debtor or by an interested party among the litigants. 2. The defence may be raised at any stage of the lawsuit, unless it is apparent from the circumstances that the person entitled to invoke it has expressly or impliedly waived it. Book Two Nominate Contracts Section One Contracts of Transfer of Ownership Chapter One Contract of Sale Part One Definition and Elements of the Contract of Sale

Article (445) A sale is a contract whereby the seller undertakes to transfer to the purchaser ownership of the subject matter of the sale or any other financial right, in consideration of a monetary price.

Article (446) 1. The purchaser shall have sufficient knowledge of the subject matter of the sale; failing which, they shall have the right to seek the annulment of the contract. 2. Knowledge shall be deemed sufficient if the purchaser has seen the subject matter of the sale, or if the contract includes a description thereof and its essential attributes in a manner that allows for its identification in a way that does not lead to a dispute. 3. If the contract of sale that the purchaser has sufficient knowledge of the subject matter of the sale, their right to seek the annulment of the sale on the grounds of lack of knowledge shall lapse, unless they prove that the seller has deceived them.

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Article (447) 1. If the sale is by "sample or model", the subject matter of the sale shall conform thereto. 2. If it appears that the subject matter of the sale does not conform to the sample or model, the purchaser shall have the option to accept or reject it. 3. If the sample or model is damaged, destroyed, or lost while in the possession of one of the parties to the sale, the statement of the other party regarding conformity or non- conformity shall prevail, unless the opposing party proves otherwise.

Article (448) 1. If the contracting parties disagree as to whether the subject matter of the sale conforms to the sample or model, and both the sample or model and the subject matter of the sale exist, the opinion of the experts shall prevail. 2. If the sample or model, by agreement of the parties, was in the possession of a third party of a third party and was damaged, destroyed, or lost, and the subject matter of the sale was specifically determined by its identity and agreed to be the subject matter of the contract, the seller's statement as to conformity shall prevail, unless the purchaser proves the contrary. If the subject matter of the sale was determined by kind, or was specifically…

Article (449) 1. In a sale subject to trial, the purchaser may accept or reject the subject matter of the sale, and the seller shall enable the purchaser to conduct the trial. If the purchaser rejects the subject matter of the sale, they shall declare the rejection within the agreed period. If no period is agreed upon, the rejection must be declared within a reasonable period to be

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Article (450) In a sale on approval, the rules of sale shall apply as from the date of the sale.

Article (451) If the purchaser loses their legal capacity before they approve the sale, the guardian, tutor, curator, as the case may be, shall choose what is in their best interest, in compliance with the conditions and provisions stipulated by law.

Article (452) If the purchaser dies before choosing the subject matter of the sale, and a creditor whose debt exhausted all the purchaser’s property, the right of trial shall pass to the creditor. Otherwise, this right shall pass to the heirs. If the heirs agree on the approval or rejection of the sale, their agreement shall be binding. If some approve the sale and others reject it, rejection shall prevail.

Article (453) The purchaser may not use the subject matter of the sale during the trial period except to the extent required for the purpose of the trial according to custom. If they exceed such use in a manner not intended for trial, the sale shall become binding.

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Article (454) The fruits of the subject matter of the sale during the trial period shall belong to the seller, and the expenses thereof shall be borne thereby, unless the fruits form part of the subject matter of the sale in which case they shall belong to the purchaser if the purchase is completed.

Article (455) The provisions of a sale subject to trial shall apply to a sale subject to tasting, provided that the option of tasting is not inheritable, and the sale becomes final and binding.

Article (456) The price is what the contracting parties have agreed upon in exchange for the subject matter of the sale, whether it exceeds or is less than its value. The value is the objective worth of the thing, assessed without increase or decrease.

Article (457) 1. The determination of the price may be limited to stating the criteria according to which it shall be determined at a later stage. 2. If it is agreed that the price shall be the market price, it shall, in case of doubt, be the market price at the place and time at which the subject matter of the sale shall be delivered to the purchaser. If there is no market at the place of delivery, reference shall be made to the market price at the place whose prices are customarily considered applicable. 3. The contracting parties may entrust a third party with the task of determining the price according to certain criteria they agree upon or according to the criteria determined by that th…

Article (458) If the contracting parties do not specify a price for the subject matter of the sale, this shall not result in the nullity of the sale if it is apparent from the circumstances that the contracting parties intended to adopt the price prevailing in trade or the price previously applied in their dealings.

Article (459) If the contracting parties declare a price different from what they actually agreed upon, the real price shall prevail.

Article (460) If the price is determined on the basis of weight, the net weight shall be taken into consideration, unless the two parties agree or custom dictates otherwise. Custom shall determine the tolerable amount of shortage in the goods resulting from transport or other reasons.

Article (461) 1. A sale may be conducted by a Murabaha (cost-plus sale), Tawliya (sale at cost), or Wadi'a (sale at a loss). 2. Murabaha is a sale at the original purchase price paid by the seller, with a specified added profit. Tawliya is a sale at the original purchase price without addition or reduction. Wadi'a is a sale at the original purchase price with a specified reduction. 3. In these types of sales, the original purchase price must be known, in order to avoid deception and accusation. 4. If it appears that the seller has unjustifiably overstated the cost of acquiring the subject matter of the sale, the purchaser shall be entitled to deduct the excess. 5. If the cost of acquiring th…

Article (462) 1. If an immovable property owned by a person lacking or of limited legal capacity is sold, and the sale involves gross lesion, the seller may request completion of the price to the value of the like. 2. The assessment of whether the lesion is gross or not shall be made by appraising the immovable property according to its market value at the time of the sale.

Article (463) 1. A claim for completion of the price due to gross lesion shall not be admissible after the lapse of three (3) years from the time of attaining legal capacity or from the day of the death of the owner of the sold immovable property. 2. The claim for completion of the price due to gross lesion shall not prejudice a third party acting in good faith who has acquired a real right (jus in rem) over the sold immovable property.

Article (464) 1. An increase in the price by the purchaser after the contract shall attach to the original contract if accepted by the seller, and the agreed price together with the increase shall constitute the consideration for the entire subject matter of the sale. 2. A reduction of the agreed price by the seller after the contract shall likewise attach to the original contract if accepted by the purchaser, and the remainder shall thereafter constitute the agreed price.

Article (465) 1. The price shall be due for immediate payment, unless the parties agree that it shall be deferred or paid in instalments over a specified term.

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Article (466) 1. The ownership of the subject matter of the sale shall be transferred to the purchaser as soon as the sale is concluded, unless the law or the agreement provides otherwise. 2. Each of the parties to the sale shall proceed to perform their obligations, except for those that are deferred. 3. The seller is obligated to do what is necessary to transfer ownership of the subject matter of the sale to the purchaser and to refrain from any act that would render such transfer of ownership impossible or difficult.

Article (467) If the sale is a lump-sum sale (Juzāf), ownership shall be transferred to the purchaser in the same manner as it is transferred in respect of a specifically designated thing. A sale shall be deemed lump sum even if the determination of the price is dependent on the measurement of the subject matter of the sale.

Article (468) 1. If the price is deferred, the seller may stipulate that the transfer of ownership to the purchaser shall be suspended until full payment of the price, even if the subject matter of the sale has been delivered to the purchaser. 2. If the price is payable in installments, the contracting parties may agree that the seller shall retain a portion of the price as compensation in the event of rescission of the sale if all installments are not paid. Nevertheless, the court may, depending on the circumstances, reduce the agreed compensation.

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Article (469) 1. The seller shall deliver the subject matter of the sale to the purchaser free from any third- party right, unless the law or the agreement provides otherwise. 2. If the nature of the subject matter of the sale requires, by law or custom, the delivery of its documents evidencing ownership, the seller shall deliver them to the purchaser. If the seller refuses to deliver them, or alleges their loss and they later appear, the court shall compel them to deliver them. If they do not appear after a claim of loss, the purchaser shall have the option either to rescind the sale or to uphold it. 3. The seller shall deliver the subject matter of the sale in the condition it was in at th…

Article (470) A contract relating to a building or a tree includes the land on which the building stands and the land into which the tree's roots extend. A contract relating to land includes the buildings and trees thereon, unless a condition or custom provides otherwise in either contract. A contract relating to a house includes the immovable fixtures therein, but not the movable items, unless the purchaser stipulates their inclusion in the contract.

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Article (471) The sale of land does not include the crops growing thereon, unless a condition or custom provides otherwise.

Article (472) The sale of a tree, whether independently or as appurtenant to the land, shall include the fruit born thereon if it has not been pollinated, or if it has not been set, in whole or for the most part. If it has been pollinated or has set, in whole or for the most part, it shall not be included in the contract, unless otherwise stipulated by a condition or established by custom as being appurtenant to the tree. Where the fruit has been pollinated or has set only as to one-half thereof, each part shall be governed by the foregoing rule applicable thereto.

Article (473) A contract for crops that are harvested by cutting does not include subsequent growth, unless a condition or custom provides otherwise.

Article (474) If the seller delivers the subject matter of the sale to the purchaser in a proper manner, they shall no longer be liable for any damage or loss occurring to the subject matter of the sale thereafter.

Article (475) If the quantity of the subject matter of the sale is specified in the contract and a shortage or surplus appears therein, and there is no agreement or custom in this regard, the following rules shall be followed: 1. If the subject matter of the sale is not adversely affected by division, any surplus shall belong to the seller, who is entitled to recover it in kind, and any shortage shall be borne by the seller, whether the price is determined per unit of measurement or for the total quantity sold.

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Article (476) A claim for rescission of the contract, or reduction or completion of the price, shall not be admissible if one year has elapsed from the date of delivery of the subject matter of the sale.

Article (477) Delivery is effected by placing the subject matter of the sale at the disposal of the purchaser in such a way as to enable them to take possession of it and benefit from it without hindrance, even if actual possession does not occur, as long as the seller has informed them thereof. Delivery shall take place in a manner consistent with the nature of the subject matter of the sale, and in accordance with the agreement or established custom.

Article (478) 1. If the contract does not specify a time for the delivery of the subject matter of the sale, the seller is obligated to deliver it immediately upon the conclusion of the contract. 2. If the two parties to the sale agree that delivery will take place at a time determined by the purchaser, the seller is obligated to deliver at that time, taking into account the timeframes required by the nature of the subject matter of the sale or by custom.

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Article (479) 1. The sale requires the delivery of the subject matter of the sale at the place where it is located at the time of the contract, unless there is an agreement between the parties or a custom to the contrary. 2. If the subject matter of the sale was not at the place of the contract at the time of contracting and the purchaser was unaware thereof, the seller is obligated to deliver the subject matter of the sale at the place of the contract, unless there is an agreement or a custom to the contrary. 3. If the contract or custom contemplates the dispatch of the subject matter of the sale to the purchaser, delivery shall not be completed until it reaches them, unless agreed otherwis…

Article (480) If the subject matter of the sale is in the possession of the purchaser before the sale, under any capacity or for any reason, such possession shall be deemed a delivery, unless otherwise agreed.

Article (481) Delivery shall be deemed to have taken place in the following cases: 1. If the seller retains the subject matter of the sale in their possession at the request of the purchaser. 2. If the seller notifies the purchaser to pay the price and take delivery of the subject matter of the sale within a specified period, failing which it shall be deemed delivered, and the purchaser fails to do so. 3. If the two parties to the sale agree to consider the purchaser as having taken delivery of the subject matter of the sale in a specific case, or if the law requires that certain cases be considered as delivery. 4. If the seller registers the subject matter of the sale in the name of the pur…

Article (482) 1. If the subject matter of the sale perishes in the purchaser's possession after delivery, the purchaser shall be obliged to pay the agreed price to the seller. 2. If the subject matter of the sale perishes before delivery due to a cause not attributable to the seller, the sale shall be rescinded, and the purchaser shall recover the price, unless the perishing occurs after the seller has notified the purchaser to take delivery of the subject matter of the sale. 3. If part of the subject matter of the sale perishes before delivery, the purchaser shall have the option to either rescind the sale or take the remaining part in proportion to their share of the price. In this case, t…

Article (483) 1. The seller warrants that the subject matter of the sale is free from any third-party right that may be asserted against the purchaser, if the cause of such entitlement claim predates the contract of sale. 2. The seller warrants the subject matter of the sale if the entitlement is based on a cause subsequent to the sale and arising from the seller’s own act.

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Article (484) 1. Any entitlement claim (rei vindicatio) concerning the subject matter of the sale brought before its delivery shall be directed against both the seller and the purchaser. 2. If an entitlement claim concerning all or part of the thing is brought against the purchaser after delivery, the purchaser shall notify the seller thereof, and the seller shall intervene in the proceedings in support of the purchaser or substitute themselves for the purchaser therein. 3. If the seller is notified in due time and fails to intervene in the claim, they shall be liable under the warranty, unless they prove that the judgment resulted from fraud or gross fault on the part of the purchaser. 4. I…

Article (485) The purchaser's right to the warranty shall be established even if they, acting in good faith, acknowledge the third party's right or conclude a settlement with them in respect thereof without awaiting a judicial ruling to be issued, provided that the purchaser had notified the seller of the claim in due time and called upon them to substitute for them therein, and the seller failed to do so.

Article (486) 1. If the purchaser settles with the claimant of entitlement regarding the subject matter of the sale before a judgment is rendered in their favor, and the seller denies the claimant's right, the purchaser shall be entitled to prove that the claimant is well-founded in their claim. Upon such proof, the seller shall have the option to either pay the equivalent of the settlement amount or refund the price to the purchaser.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 121 2. If the settlement is concluded after a judgment has been rendered in favor of the entitled party, the purchaser shall retain the subject matter of the sale and shall…

Article (487) If the whole of the subject matter of the sale is subject to entitlement and the entitled party does not authorize the sale, the contract shall be rescinded, and the purchaser may claim the following from the seller: 1. The value of the subject matter of the sale at the time of the entitlement claim, unless the law provides otherwise. 2. The value of the fruits that the purchaser was compelled to return to the entitled party. 3. The value, as assessed at the time of the entitlement claim, of any useful improvements made by the purchaser to the subject matter of the sale. 4. Compensation for any loss sustained or profit lost as a result of the entitlement of the subject matter o…

Article (488) 1. If part of the subject matter of the sale is subject to entitlement before the purchaser has taken possession of the whole thereof, the purchaser may return what they have possessed and recover the price, or accept the sale and claim the price corresponding to the entitled part. 2. If part of the subject matter of the sale becomes subject to entitlement after the purchaser has taken possession of the whole thereof, and the entitlement causes a defect in the remainder, the purchaser may return it and have recourse against the seller for the price, or retain the remainder for a proportionate part of the price. If no defect is caused and the entitled part is the lesser part, th…

Article (489) 1. The contracting parties may agree to increase the warranty against entitlement. 2. Any condition that excludes or reduces the warranty shall be void. 3. The purchaser's knowledge that the subject matter of the sale is not owned by the seller shall not prevent them from recovering the price in the event of entitlement.

Article (490) 1. If the entitlement is established on the basis of the purchaser's admission or their refusal to take an oath, they may not have recourse against the seller. 2. The purchaser may have recourse against the seller under the warranty, even if entitlement is established by their admission or refusal to take an oath, provided that the purchaser acted in good faith and had notified the seller of the entitlement claim in due time and invited them to join the proceedings, and the seller failed to do so, unless they prove that the entitled party was not justified in their claim.

Article (491) 1. If entitlement is claimed after the subject matter of the sale has perished while in the purchaser's possession, the purchaser shall be liable to the entitled party for its value as at the date of sale, and shall have recourse against the seller for the price.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 123 2. If the value for which the purchaser is liable exceeds the agreed price, they shall be entitled to recover the difference, along with compensation for damages due under Clause (5) of

Article (492) The entitled party may claim from the purchaser the benefit derived from the fruits or yield of the subject matter of the sale, after deducting the production expenses required, and the purchaser shall have recourse against the seller for whatever they have paid to the entitled party. 4. Warranty for Latent Defects

Article (493) 1. A sale is deemed to be concluded on the basis that the subject matter of the sale is free from defects. 2. The general rules governing the option for defect shall apply to the contract of sale, with due regard to the provisions of the following Articles.

Article (494) 1. The defect giving rise to the purchaser's option for defect is the latent defect. 2. A defect is latent if it is old and existed in the subject matter of the sale before the sale, or arose thereafter while in the seller's possession and before delivery, and is of a kind that cannot be detected by ordinary inspection, is not apparent to an ordinary person, can only be discovered by an expert, or only appears through testing. 3. Any defect that appears after the purchaser has taken delivery of the subject matter of the sale shall likewise be deemed a latent defect if it is proven to have arisen from a cause existing in the subject matter of the sale before delivery.

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Article (495) If a latent defect appears in the subject matter of the sale, the purchaser shall have the option to either return it or retain it and demand from the seller a reduction of the price proportionate to the defect, and the seller may avert this by providing a defect-free equivalent of the subject matter of the sale.

Article (496) The seller shall be liable under the warranty if, at the time of delivery, the subject matter of the sale lacks the qualities that the seller guaranteed to the purchaser to exist therein, or if the subject matter of the sale has a defect that diminishes its value or its utility for the intended purpose, as stated in the contract or as apparent from the nature of the thing or the purpose for which it was prepared. The seller shall be liable for this defect even if they are unaware of its existence.

Article (497) The seller shall not be liable for a defect in the following cases: 1. If the seller disclosed the defect to the purchaser at the time of sale. 2. If the defect is one that is customarily tolerated. 3. If the purchaser accepted the defect after having examined it or after becoming aware of it through another. 4. If the purchaser purchased the subject matter of the sale, knowing of the defect therein. 5. If the seller stipulates exclusion of liability for any defect or for a specific defect, unless the seller deliberately concealed the defect by way of fraud, or the purchaser was in a condition that prevents them from inspecting the defect. 6. If the defect arose after delivery,…

Article (498) The seller shall not be liable for defects known to the purchaser at the time of the sale, or which the purchaser could have discovered by themselves had they inspected the subject matter of the sale with the care of an ordinary person, unless they prove that the seller affirmed that the subject matter of the sale was free from such defect, or proves that the seller deliberately concealed the defect by way of fraud.

Article (499) If the purchaser disposes of the subject matter of the sale as an owner after becoming aware of the latent defect, their option for defect shall be forfeited.

Article (500) If the subject matter of the sale perishes due to a latent defect while in the purchaser's possession or is consumed before they become aware of the defect, they may recover from the seller the reduction in price caused by the defect.

Article (501) 1. If a new defect occurs in the subject matter of the sale while in the purchaser's possession, they may not return it on the basis of the latent defect, but may only demand from the seller a reduction in the price, unless the seller agrees to take it back with the new defect. 2. If the new defect ceases, the purchaser's right to return the subject matter of the sale to the seller on the basis of the latent defect shall be restored.

Article (502) 1. If the seller warrants the fitness of the subject matter of the sale for use for a specified period and a defect appears in the subject matter of the sale during that period, the purchaser shall notify the seller of this defect within one month from its appearance, unless a longer period is agreed upon.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 126 2. If the seller fails to repair the defect, the purchaser may request rescission of the contract with compensation, or retain the subject matter of the sale and claim compensation for the damage suffered due to the defect.

Article (503) 1. If several things are sold in a single transaction and a defect appears in some of them before delivery, the purchaser shall have the option to accept them for the agreed price or to return them all. 2. If several things are sold in a single transaction and a latent defect appears in some of them after delivery, and their separation does not cause harm, the purchaser may return the defective thing for its proportionate share of the price, and shall have no right to return all of them without the seller's consent. If their separation does cause harm, the purchaser may return all the things sold or accept them for the full price.

Article (504) 1. If the subject matter of the sale has a defect that requires its return, and the purchaser has, before becoming aware of the defect, encumbered it with a right in favor of a third party that does not divest them of ownership, the purchaser may return it to the seller on account of such defect after releasing it from such right, provided that the subject matter of the sale has not changed during this period. 2. If the purchaser encumbers the subject matter of the sale with a right in favor of a third party after becoming aware of the defect, their right to return it for that defect shall be forfeited. If the subject matter of the sale has changed, it shall be governed by the…

Article (505) The purchaser's right to return the subject matter of the sale for a defect shall not be forfeited solely due to a change in its value.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 127

Article (506) 1. The yield of a subject matter of the sale returned for a defect, which is not considered part thereof, shall belong to the purchaser from the date of taking possession of the subject matter of the sale until the date of rescission of the sale, and the purchaser may not claim from the seller the expenses incurred in relation thereon. 2. The yield of a subject matter of the sale returned for a defect, which is considered part thereof, shall belong to the seller. 3. The purchaser may recover from the seller the expenses incurred in respect of the subject matter of the sale returned for a defect that produced no yield.

Article (507) The risk of a subject matter of the sale returned for a defect shall pass from the purchaser to the seller upon the seller’s consent to take it back from the purchaser, even if actual delivery has not taken place, or upon the establishment before the court of the defect warranting return, even if no judgment ordering the return has been rendered, provided that the seller is present. If the seller is absent, the risk shall not pass thereto except upon the issuance of a judgment ordering the return of the subject matter of the sale.

Article (508) The warranty for a defect shall pass to the purchaser's heirs.

Article (509) The claim for warranty in respect of a defect subsists even if the subject matter of the sale has perished for any reason whatsoever.

Article (510) A claim for warranty in respect of a defect shall not be admissible upon the lapse of one year from the day following the delivery of the subject matter of the sale, unless the seller has undertaken to provide a longer warranty period. The seller may not rely on this period if it is established that the defect was concealed by fraud on their part.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 128 Second: Purchaser's Obligations 1. Payment of the Price and Taking Delivery of the subject matter of the sale

Article (511) The purchaser shall pay the price upon conclusion of the contract and before taking delivery of the subject matter of the sale or demanding it, unless otherwise agreed.

Article (512) 1. The seller may withhold the subject matter of the sale until they receive the price due to them, even if the purchaser has offered a pledge or a guarantee. 2. If the subject matter of the sale perishes while in the seller's possession while they are withholding it, the loss shall be borne by the purchaser, unless the perishing was caused by the act of the seller. 3. If the seller agrees to defer the price, their right to withhold the subject matter of the sale shall be forfeited, and they shall be obliged to deliver it to the purchaser.

Article (513) 1. If the purchaser takes possession of the subject matter of the sale before paying the due price, in the presence of the seller and without objection on their part, this shall be deemed consent to delivery. 2. If the purchaser takes possession of the subject matter of the sale before paying the due price, without the seller's consent, the seller may recover the subject matter of the sale. If the subject matter of the sale perishes or becomes defective while in the purchaser's possession, they shall be deemed to have taken delivery, and the seller may recover the price and claim compensation from the purchaser, where applicable.

Article (514) The destruction of the subject matter of the sale by the purchaser, even without intent, shall be deemed to constitute taking possession thereof.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 129

Article (515) If the purchaser was unaware of the location of the subject matter of the sale at the time of the contract and then becomes aware thereof, they shall have the option to either rescind the sale or to affirm it and take delivery of the subject matter of the sale at its place of existence.

Article (516) 1. The purchaser shall be obliged to pay the immediate price at the location of the subject matter of the sale at the time of the contract, unless there is an agreement or custom to the contrary. 2. If the price is a deferred debt upon the purchaser and there is no agreement on its payment at a specific place, it shall be paid at the purchaser's domicile at the time the payment falls due.

Article (517) If the purchaser takes possession of an item on approval for purchase and it perishes or is lost while in their possession, and the price has been specified, they shall be bound to pay it. If the price has not been specified, the purchaser shall not be liable except in cases of transgression or negligence.

Article (518) 1. If an entitlement claim (rei vindicatio) is brought against the purchaser in respect of the subject matter of the sale based on a right predating the sale or deriving from the seller, the purchaser may withhold the price until the seller provides a suitable guarantee or a solvent surety who ensures the return of the price to the purchaser upon establishment of the entitlement. The seller may request the court to order the purchaser to deposit the price with it instead of providing the guarantee or a surety. 2. The provision of Paragraph (1) of this Article shall apply if it becomes apparent to the purchaser that the subject matter of the sale has an old defect guaranteed by…

Article (519) If a specific date for payment of the price is set in the sale, and it is stipulated therein that if the purchaser does not pay the price on that date, there shall be no sale between them, and the purchaser does not pay it while the subject matter of the sale is remains in the seller's possession, the sale shall be deemed to be legally rescinded.

Article (520) 1. If the purchaser has taken possession of the subject matter of the sale and then dies bankrupt or insolvent before paying the price, the seller may not demand the return of the subject matter of the sale, and the price becomes a debt upon the estate, with the seller being pari passu with the other creditors. 2. If the purchaser dies bankrupt or insolvent before taking possession of the subject matter of the sale and paying the price, the seller has the right to retain the subject matter of the sale until the price is recovered from the purchaser's estate, and shall have priority over other creditors. 3. If the seller takes possession of the price and dies bankrupt or insolve…

Article (521) The purchaser shall bear the expenses of payment of the price, registration of the sale contract, and other expenses, and the seller shall bear the expenses of delivery of the subject matter of the sale and other costs, unless there is a provision of law, an agreement, or a custom to the contrary.

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Federal Decree by Law of 2025 Promulgating the Civil Transactions Law 131 Part Three Certain Types of Sales First: Salam Sale

Article (522) Salam is a sale with deferred delivery for an advance price.

Article (523) 1. The following conditions shall be met for a Salam sale to be valid: a. The subject matter of the sale shall be of property that can be specified by description and quantity, and that is usually available at the time of delivery. b. The contract shall include a statement of the genus, type, quality, quantity, and the time of delivery of the subject matter of the sale. 2. The Salam capital (the price) shall be known to the contracting parties, and payment shall be made at the time of contracting.