UAE Civil Transactions Law 2026: What Businesses Should Review

What changed, and why should a business care?

Federal Decree by Law No. 25 of 2025 promulgated a new Civil Transactions Law and set its commencement date as 1 June 2026. The official legislation summary describes changes affecting pre contractual negotiations, framework agreements, contracts of works, guarantees, company related provisions and other civil transactions.

This does not mean every existing contract is automatically invalid or that every clause needs to be rewritten. The practical impact depends on the transaction, the wording used, the law governing the agreement, when the relevant events occurred and any transitional or specialist rules that apply.

Six contract areas worth reviewing

1. Pre contractual information. Review how important information is disclosed during negotiations, who is responsible for providing it and how key assumptions are recorded. Keep material communications with the contract file.
2. Framework and repeat business agreements. Where your team places recurring orders or provides ongoing services, check whether a framework agreement would clarify core terms and the relationship between the main agreement and each order.
3. Scope, delivery and acceptance. Make the work, milestones, acceptance process, change control and dependency on client information easy to understand. Avoid relying on vague descriptions of deliverables.
4. Guarantees and security. Identify the exact guarantee or security being provided, the triggering events, any expiry date, notice requirements and the relationship with the underlying obligation.
5. Termination and unexpected events. Review termination triggers, cure periods, consequences of termination and clauses addressing circumstances that materially affect performance. A clause should be reviewed against the governing law rather than copied from another jurisdiction.
6. Corporate documents and authority. Confirm the correct contracting entity, authority to sign and consistency between the contract, purchase order and any board or shareholder approval required.

Do we need to replace all our old templates?

Not automatically. Start with the agreements your business uses most often and those with material value, long duration, personal guarantees, recurring orders or significant delivery risk. Ask whether the contract remains clear, whether the operational process matches the wording and whether the new law or another applicable rule affects a particular clause.

A practical internal review plan

• List active standard templates and the business owner for each.
• Prioritise high value and higher risk agreements before low value routine documents.
• Compare the wording with the way the business negotiates, approves, performs and terminates contracts.
• Record proposed changes and train the people who use the templates.
• Set a review date when the law, the business model or the contract form changes.

Questions businesses commonly ask

Does the new law apply to every UAE contract?

Not in the same way. The governing law, the nature of the agreement, specialist legislation and any applicable free zone or local regime all matter. Check the agreement and the legal context before relying on a general summary.

Should we change a contract that was signed before June 2026?

Do not assume that a contract signed earlier is automatically ineffective or automatically unaffected. The relevant event, wording, governing law and transitional rules should be checked for the specific question.

Where can I read the law itself?

The UAE Legislation portal hosts Federal Decree by Law No. 25 of 2025 and the official summary of the new Civil Transactions Law. Use the primary source rather than a social media summary when making a business decision.

Disclaimer: This article provides general legal information for awareness and is not legal advice on a particular matter. Laws, procedures and outcomes depend on the facts, jurisdiction and applicable legal framework. It does not create a lawyer client relationship. Please verify the current official source and seek appropriately scoped advice before acting.