New commercial transactions law to regulate contracts, boost investment climate

Minister of Commerce Majid bin Abdullah Al-Qasabi confirmed that the Cabinet’s approval of the new Commercial Transactions Law aims to regulate commercial contracts, including commercial sales, supply sales, brokerage, and commercial agency. The law allows individuals aged 15 and above to engage in commerce under specific conditions, and is legislatively integrated with the Civil Transactions Law to stimulate the commercial and investment environment.
The law comprises 271 articles that define the nature of commercial activities, merchants and shops, merchants’ obligations, accounting records, commercial contracts, and rules for commercial papers such as promissory notes, bills of exchange, and checks. It replaces three previous laws: the Commercial Law, the Commercial Papers Law, and the Commercial Books Law.
The law permits minors aged 15 to conduct business with the permission of their guardian, trustee, or the court. It redefines the term 'merchant,' specifies which activities are considered commercial if practiced once, and which require regular practice to be classified as commercial.
The law also promotes fair competition among merchants and prohibits actions that harm competitors. It clarifies the rights of those affected to seek court intervention to stop harm and claim compensation.
Certain categories of merchants are exempt from keeping accounting records, while the law emphasizes preserving records electronically or in paper form in Arabic, with the option to keep them in another language. The law aims to improve predictability in commercial transactions and reduce disputes.
The law addresses commercial contracts and, for the first time in a single legislative document, regulates commercial sales, supply sales, commercial agency, and brokerage, outlining provisions to protect rights.
The Commercial Transactions Law, which will come into effect 180 days after its publication in the official gazette, provides protections for business dealings involving traders and small and medium enterprises, supporting their growth through commercial contracts and agency operations.