Commercial Transactions Law strengthens contractual stability, safeguards commercial practices

RIYADH —The Commercial Transactions Law keeps pace with developments in the commercial and investment environment through its comprehensive scope and consistency with laws that promote contractual stability and enforceability and protect the interests of parties to commercial transactions. It complements the Civil Transactions Law. The Commercial Transactions Law stipulates that the provisions of the Civil Transactions Law apply to cases not expressly addressed by the former when no commercial custom or practice exists, making the Civil Transactions Law a supplementary source for filling legislative gaps in the commercial environment. In establishing certain provisions, the law also relies on general rules codified in the Civil Transactions Law to address matters for which no specific commercial provisions exist. The Commercial Transactions Law, which governs commercial transactions, draws on the terminology and theoretical framework set out in the draft Civil Transactions Law to ensure consistency and harmony between the two laws. The Commercial Transactions Law also addresses commercial contracts and commercial agencies, which had not previously been governed by detailed legislation. It establishes clear procedures and rules for commercial contracts and agencies to promote transparency and fairness in commercial dealings and protect the rights of contracting parties. These matters are covered by approximately 69 of the law's 271 articles. The law sets out the rules and requirements governing commercial sales, supply contracts, commercial agencies, and brokerage, addressing the obligations of all parties and the consequences of breaching agreed terms.