Saudi Commercial Law Allows Citizens Aged 15 to Do Business

Saudi Arabia has approved a new commercial transactions law that will allow citizens aged 15 and older to engage in business under specific conditions, while consolidating a broad range of commercial regulations into a single framework.

The 271-article law was approved by the Cabinet, chaired by Crown Prince and Prime Minister Mohammed bin Salman bin Abdulaziz. It covers commercial activities, merchants, business establishments, contracts, accounting records and negotiable instruments including bills of exchange, promissory notes and cheques.

Commerce Minister Majid Al-Qasabi said the legislation also regulates commercial sales, supply contracts, brokerage and commercial agency agreements. It replaces the Commercial Law, Negotiable Instruments Law and Commercial Books Law.

The law introduces provisions intended to strengthen fair competition, allowing businesses affected by harmful competitive practices to seek court orders and compensation. Certain merchants will also be exempt from maintaining accounting records, while records that are required may be kept electronically or on paper in Arabic, with the option of using another language.

Electronic documents will receive the same evidentiary standing as original paper documents, while the legislation also clarifies rules around commercial contracts and registration.

The framework is intended to give small and medium-sized enterprises clearer legal protections and reduce uncertainty around commercial transactions. It will take effect 180 days after publication in the Official Gazette.