Saudi Arabia — The New Civil Transactions Law

Abstract

Abstract On 16 December 2023, the new Saudi Civil Transactions Law entered into force. The law, for the first time, provides a comprehensive codification of contract, tort, and property law in Saudi Arabia, hereby replacing Sharīʿah principles that the courts relied on in the past. The law is a milestone in the modernization of Saudi economic law. First, the codification will enhance legal certainty, given that it was often difficult to predict how a Saudi court would apply Sharīʿah principles to a present-day commercial contract. Second, the legal enactment demonstrates that the Saudi legislature does not shy away from legislating core areas of law and replacing Sharīʿah rules that — in theory — continue to be the supreme law of the land. In substance, many provisions of the new law appear to be inspired by Egyptian law. The implementation in Saudi judicial practice remains to be seen.