UAE Civil Transactions Law Amendments: What the Proposed Changes Could Mean for Individuals and Businesses

The UAE is preparing to introduce wide-ranging amendments to its Civil Transactions Law, signalling a significant shift in how legal capacity, contracts, compensation and financial assets are regulated. Although the amended law has not yet been officially published, publicly announced details suggest a broader legislative direction aimed at earlier legal responsibility, clearer contractual obligations and enhanced protections in civil matters.

Once enacted, the changes are expected to influence everyday legal and financial decisions for residents, businesses and families across the country.

 

Legal Adulthood to be Set At 18

One of the most significant proposed amendments is the reduction of the age of legal majority from 21 to 18. This would mean individuals are considered fully legally capable at 18, allowing them to enter into contracts, manage their affairs and assume legal responsibility without guardianship.

This approach aligns with recent legislative developments in the UAE, including lower age thresholds in areas such as driving, commercial activity and banking, reflecting a broader move towards recognising legal capacity at an earlier stage.

Earlier Asset Management for Minors Under Court Supervision

 

The amendments may also lower the age at which minors can obtain court approval to manage personal or inherited assets. Publicly available information indicates this threshold could be reduced from 18 to 15, subject to strict judicial oversight and defined conditions.

 

If confirmed, this would grant limited financial autonomy to younger individuals while maintaining safeguards through court supervision.

 

New Provisions for Missing Persons and Unknown Parentage

 

The updated law is expected to introduce more detailed rules addressing cases involving missing persons, absentees and individuals of unknown parentage. These provisions aim to clarify legal status, rights and asset management in situations that have traditionally posed legal and procedural challenges.

 

The practical impact of these changes will depend on the final definitions, conditions and procedures set out in the published legislation.

 

Contract Registration May Affect Legal Validity

 

Another significant development under consideration is the possible requirement to register certain contracts as a condition for their legal validity or enforceability. While registration already applies to specific agreements in the UAE-- such as tenancy contracts, property transactions and employment contracts -- the amendments may expand or formalise this approach.

 

If implemented, this could have important implications for how parties document and formalise their contractual relationships.

 

Clearer Rules for Expat Assets With No Heirs

 

The amendments may also address how assets belonging to expatriates are handled when a person dies in the UAE without a will and without identifiable legal heirs. Under the current framework, such assets may eventually revert to the state.

 

The proposed changes could introduce more detailed mechanisms, including structured processes for asset management and alternative outcomes, such as channelling certain assets into charitable endowments under official oversight.

 

New Obligations During Pre-contract Negotiations

 

The updated law is expected to clarify duties relating to pre-contractual conduct, particularly disclosure obligations during negotiations. This would represent a shift towards regulating behaviour before a contract is concluded, rather than focusing solely on liability after disputes arise.

 

Such changes could be especially relevant in commercial transactions where there is an imbalance of information between parties.

 

Stronger Buyer Protections and Defect-Related Rights

 

Proposed amendments to sale contracts may refine rules governing sales by sample or model, strengthen protections for individuals with limited legal capacity in property transactions, and update provisions on latent defects.

 

There are indications that limitation periods for certain defect-related claims may be extended, potentially rebalancing the rights and obligations of buyers and sellers. Buyers may be given clearer options to reject defective goods, seek replacements or accept price reductions where products or property do not meet agreed standards.

 

Expanded Compensation in Injury And Death Cases

 

Another key proposal involves allowing compensation beyond traditional blood money or assessed damages in cases of injury or death, particularly where material or moral harm is not fully addressed by existing mechanisms.

 

If enacted, this would mark a move towards more comprehensive compensation in serious personal injury and fatality cases.

 

Status of the New Law

 

The amendments are contained in Federal Decree-Law No. 25 of 2025, which will revise the UAE Civil Transactions Law (Federal Law No. 5 of 1985). However, the law has not yet been officially published in the UAE Federal Gazette. Until publication and confirmation of its effective date, details remain based on publicly released information.

 

A complete legal assessment of the scope and impact of the amendments will only be possible once the final text is formally issued.

 

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