Federal Decree by Law No. (50) of 2022 Concerning Promulgating the Commercial Transactions Law (economy and business law)

Article (148 ) 
1. The buyer shall not be bound to accept the documents sent to him by the seller if they do 
not conform to the stipulations of the sale contract. The buyer shall be deemed to have accepted such documents if he does not raise any objection via the seller's bank within (7) 
seven days of the date of receipt. Any objection shall be made by notice served in writing to the seller requiring him to send documents conforming to the conditions agreed upon 
within a reasonable time limit. The buyer may, after the expiry of said time limit, request 
the termination of the sale and payment of damages, where applicable.  
2. Where the buyer returns the documents for certain specified reasons or accepts them with reservations, he may not thereafter make any objection other than for the causes and 
reservations already made.  
3. Where the buyer returns the documents without any legitimate reason, he shall be liable 
to compensate the seller for whatever damage that may result therefrom.  
  
Article  (149 ) 
Where the vessel carrying the item sold arrives before the arrival of the documents or where 
the documents received are incomplete, the seller shall immediately, upon being informed of 
the same, carry out whatever action that may be necessary to enable the buyer to obtain a 
copy of the documents which have not arrived or to complete the incomplete documents. The  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 59 seller shall bear the resulting expenses and any damages, where applicable.  
  
Article (150 ) 
Without prejudice to the provisions of article ( 108) above, the buyer shall receive the item 
sold upon its arrival at the port agreed upon, and the buyer shall bear such sums as will be 
due on the item sold during its transport and the expenses of discharge upon its arrival, save 
where the carrier has o btained such sums and expenses at the port of shipping or where it is 
agreed in the sale contract that they shall be borne by the seller (the sale being CIF until the 
discharge).  
  
Article (151 ) 
Where the buyer reserves the right to fix a date for the ship ping or to designate the port of 
discharge within a set time limit but he fails to issue specific instructions during such time 
limit, he shall be liable for any additional expenditure resulting therefrom and such damage 
as may be suffered by the item sold  until the expiry of the time limit for shipping; provided 
that the item sold has been, on that date, designated per se.  
  
Article (152 ) 
Where something contrary to the documents is detected and such contradiction does not exceed the limit allowed by custom, the buyer shall be bound to accept the same with a 
reduction of the price, as per the applicable custom at the port of destination.  
  
Article (153 ) 
Arrival Sale  
A contract which contains such conditions as will render the seller liable for the perishing of  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 60 the goods after shipment, or makes the performance of the contract conditional to the safe 
arrival of the vessel, or which vests in the buyer an option to accep t the goods according to 
the contract or according to the pro -forma delivered to him at the time of contracting, shall 
neither be a CIF nor FOB sale, but shall be deemed to be a sale conditional to the delivery at 
the place of arrival.  
  
Article (154 ) 
Sale  at the Airport of Departure  
A sale at the airport of departure is one by which the goods sold are delivered at the airport of 
departure by placing them at the disposal of the air carrier designated by the buyer or chosen 
by the seller.  
  
Article (155 ) 
1. The  seller shall, after entering into the contract, undertake to deliver the goods at the 
airport of departure to the air carrier or to its representative at the place and on the date 
agreed upon or at the place designated by the buyer, in accordance with the  rules and 
practices applicable at the airport of departure.  
2. The seller shall without delay notify the buyer that the delivery of the goods has been 
effected by any means of telecommunications or means of modern technology.  
  
Article (156 ) 
1. The seller shall conclude a goods carriage contract, at the expense and responsibility of 
the buyer, if it is so requested by the buyer; or the seller shall perform the same where the 
buyer has not issued instructions on the goods carriage within a reasonable time, and such 
act shall be according to the applicable commercial customs. The seller may refrain from  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 61 concluding a carriage contract, in which case, the buyer shall be promptly notified thereof.  
2. Where the seller takes it upon himself to conclude a carriage contract, he shall abide by 
the instructions issued to him by the buyer and choose an airplane suitable to carry goods 
of such nature as the item sold on an ordinary flight from the airport of departure to the 
airport of arrival designated by the buyer, or to the closest airport to the buyer's 
establishment.  
  
Article (157 ) 
1. The seller shall pay all duties and taxes due on the goods as a result of their export.  
2. The seller shall provide the buyer with all the documents needed for the receipt of goods  
which are readily available to the seller.  
  
Article (158 ) 
Where the air carrier or the other person designated by the buyer refrains from receiving the 
goods at the airport of departure, or where the buyer fails to provide the seller, within a 
reasonable  time, with the instructions required for the transportation of goods, the seller shall, 
as soon as possible, notify the buyer thereof.  
  
Article (159 ) 
1. In the event where the seller is not bound to conclude the goods carriage contract, the buyer shall, at his own expense, organize the carriage of goods from the airport of 
departure to the airport of arrival. The buyer shall further designate the air carrier or it 
representative or any other person to whom the goods are to be delivered, and he shall 
notify t he seller within a reasonable time thereof.  
2. Where the buyer fails to notify the seller, within a reasonable time, of the instructions  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 62 required for the carriage of goods, the buyer shall bear all the additional costs arising 
therefrom, as well as any damage  that may be sustained by the goods, from the date fixed 
for delivery, provided that the goods were allotted or designated per se.  
  
Article (160 ) 
Where the air carrier or any other person designated by the buyer refrains from receiving the goods, the buyer shall bear all additional costs arising therefrom, as well as any damage that 
may be sustained by the goods, as of the date on which the goods have become ready for 
delivery; provided that the goods are allotted and designated per se.  
  
Article (161 ) 
The sale contract in the above international sales shall be separate and may not affect the 
relations between the seller, the buyer and the carrier to the carriage contract, or between the 
buyer and the bank in the documentary credit contract.  
  
Part T hree 
Commercial Mortgage  
Article (162 ) 
 
1. A commercial mortgage is a mortgage executed on a movable property to secure a 
commercial debt.  
2. Except for the restrictions stipulated herein or in any other law, a commercial mortgage 
may be proved by all means of evidence with regard to the contracting parties and against 
third parties.  
3. The application of the provisions of this Part shall be effected without prejudice to any  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 63 particular legislation governing the commercial legislation.  
  
Article (163 ) 
1. A commercial m ortgage shall be effective against a debtor or third parties only where the 
possession of the mortgaged item passes from the mortgagor to the mortgagee or to a 
third party appointed by both contracting parties and remains in the possession of either 
such p arty receiving it until the lapse of the mortgage; or unless it is placed under joint 
possession in such manner as to prevent the mortgagor to dispose thereof without the knowledge of the creditor.  
2. The mortgagee or the third party shall be deemed as having  possession of the mortgaged 
property if it is placed at his disposal in such a manner as will lead others to believe that the mortgaged property has come into his custody; or if he receives a deed representing 
the mortgaged property vesting unto its holde r the sole right to take delivery of the same.  
3. The transfer of possession of rights shall be effected by the delivery of the instruments establishing them; and where the instrument is lodged with a third party, the delivery of 
the deposit receipt shall be deemed as the delivery of the instrument itself; provided that 
the instrument is described in the receipt accurately and in detail and provided that the 
depositary accepts possession thereof for the account of the mortgagee. In such case, the 
depositary sh all be considered as having waived every right he had to retain the 
instrument for his own account for a reason existing prior to the mortgage, unless he had reserved such right when he accepted to hold possession of the instrument for the account 
of the mortgagee.  
  
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 64 Article (164 ) 
1. Where the mortgaged item consists of registered instruments, the mortgage thereof shall 
be made in writing with a waiver of such instruments stating that they are made as a 
security. This shall be marked on the instrument itself  and such waiver shall be recorded 
in the registers of the authority having issued the instrument. The rank of the mortgagee shall be determined as of the date of such registration.  
2. As for promissory notes, the mortgage thereof shall be effected by an endo rsement stating 
that the value is for mortgage, security or any other statement to that effect.  
  
Article (165 ) 
1. A debtor who is indebted with a commercial debt may garnish in favor of his creditor by a 
written instrument a debt owed to him by a third party. In this case, the debtor shall deliver 
to the judgment creditor the instrument establishing the said debt.  
2. The garnishment of the debt shall take effect against the debtor on whose debt the garnishment was effected only by serving such garnishment upon him or by his 
acceptance thereof. In addition, it shall take effect against third parties only by the 
possession of the judgment creditor of the debt instrument.  
3. The rank of the debt shall be determined as of the date of service or acceptance.  
  
Article (166 ) 
A mortgagee shall take all the necessary measures to safeguard the mortgaged item and 
undertake the maintenance thereof. Where the mortgaged item is a negotiable instrument, 
the mortgagee shall on the maturity date carry out the proceedings necessary to protect the 
right established therein and collect it. The mortgagor shall pay all expenses incurred by the 
mortgagee in this regard.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 65   
Article (167 ) 
A mortgagee shall use on behalf of the mortgagor all the rights and procedures relevant to the 
item m ortgaged, as well as receiving its value, profits, interests and any other sums resulting 
therefrom. He shall however deduct the sums received from the value of the expenses incurred on behalf of the mortgagor, then from the interests and then from the principal sum 
secured by the mortgage, unless otherwise provided by the agreement.  
  
Article (168 ) 
A mortgagee shall, when requested by the mortgagor, deliver to him a receipt showing the 
nature, type, amount, weight and other distinguishing features of the m ortgaged item.  
  
Article (169 ) 
1. Where a mortgage is effected on a fungible item, it shall remain in place even if the 
mortgaged item has been replaced by another item of the same kind.  
2. Where the mortgaged item is non -fungible, the mortgagor may replace it by another item; 
provided that the same is agreed on in the mortgage contract and that the mortgagor 
accepts the substitute, without prejudice to the rights of a bona fide third party.  
  
Article (170 ) 
1. Where the mortgagee fails to pay the secured debt on the maturity the debt, the mortgagor 
may, after the lapse of (7) seven days from the date of notifying the debtor of repayment, 
request the court to authorize him to sell the mortgaged item. The request shall be 
considered on an urgent basis, and the court s hall decide the sale method.  
2. The mortgagee shall, by exercising the lien, collect his debt, including the principal  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 66 amount, interests and expenses paid in the course of claiming his debt, from the price 
generated from the sale.  
  
Article (171 ) 
Where the mortgage is decided for several properties, the mortgagee may designate the 
property to be sold, unless otherwise agreed upon. In all cases, the sale may cover only the sum needed to clear the mortgagee's right, except where the item sold is indivisible.  
  
Article (172 ) 
Where the market price of the mortgaged item decreases and becomes insufficient to secure 
the debt, the creditor may fix a suitable time limit for the mortgagor to complement the 
security. If the mortgagor refuses the same or where the fixed  time limit expires and the 
mortgagor fails to complement the security, the creditor may cause the item mortgaged to be sold, even before the maturity date, by adopting the procedures stipulated in article (170) 
above.  
  
Article (173 ) 
Where the mortgaged property is perishable or is subject to deterioration or devaluation, or 
where its possession necessitates the incurring exorbitant expenses and the mortgagor is 
unwilling to replace it by another property, both the creditor and mortgagor may request the 
court to authorize him to sell it forthwith and determine the method of sale. The mortgage 
shall be transferred to the price generated from the sale.  
  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 67 Article (174 ) 
1. An agreement concluded at the time or after the establishment of a mortgage shall be null 
and void, and shall vest in the mortgagee, in the event that the debtor fails not repay the 
debt on the maturity date, the right to acquire or sell the mortgaged property, with no need 
to comply with the provisions and procedures set forth in article (170 ) above.  
2. Nevertheless, after the maturity of the whole debt or an installment thereof, the debtor 
may assign to the creditor the whole or part of the mortgaged property, so as to repay the 
debt or part thereof.  
  
Article (175 ) 
Where the mortgaged item is an instrument and the nominal value of which has not been paid 
in full, the mortgagor shall, when claiming the unpaid portion, present to the mortgagee the 
sums of money needed to pay such portion, at least two days before the maturity date; 
otherwise, the creditor may sell the instrument, pursuant to the procedures set forth in Article 
(170) above.  
  
Part F our 
Depositing  in Public  Warehouses  
Article (176 ) 
1. Public warehousing is a contract pursuant to which the warehouseman, whether an 
individual, a company or a public person, undertakes to receive and store goods for the account of the bailer or any other person to whom ownership or possession thereof 
devolves, as per the instruments representing the same.  
2. No public warehouse vested with the right to issue negotiable instruments representing the goods warehoused may be constructed or invested without a license issued by the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 68 competent authority in the relevant Emirate, as per the terms and conditions as are laid 
down by the Minister of Economy, in consultation with the competent local authority in 
the relevant Emirate.  
3. Any warehouse where goods are received for storage and no storage receipt and pledge 
deed are issued against such goods shall not be subject to the provisions of public 
warehouses.  
4. Any person who  invests a public warehouse shall cover it with an insurance against risks 
of fire, damage and theft.  
  
Article (177 ) 
1. A warehouseman may not practice in any capacity, either for himself or for others, any 
commercial activity having for goods of the same kind as the goods which he is licensed 
to keep in his warehouse and issue instruments representing such goods.  
2. The above provision shall apply if the person in charge of investing the warehouse is a company where one of its partners, who owns at least (10%) ten percent of its capital, 
practices a commercial activity included in the prohibition provided in Clause (1) above.  
  
Article (178 ) 
1. The bailer shall provide the public warehouse with correct data about the nature, type, 
value and quality of the goods w arehoused.  
2. The bailer may examine the goods delivered to the public warehouse for his account and to take samples thereof.  
  
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 69 Article (179 ) 
1. The warehouseman shall be responsible for the goods handed over to him up to a sum 
not exceeding that estimated by the bailer.  
2. The warehouseman shall not be held accountable for any loss or deficit sustained by the 
goods if such loss or deficit caused by a force majeure event or by the nature of the goods 
or packing thereof.  
  
Article (180 ) 
The warehouseman may, after notifying the bailer, apply to the court to which jurisdiction the 
public warehouse pertains to grant him permission to sell the goods warehoused if they are 
subject to immediate damage, and the court shall designate the method of sale.  
  
Article (181 ) 
1. The  bailer shall receive from the warehouseman a storage receipt showing the bailer's 
name, occupation and domicile, as well as the type, nature and quantity of the goods 
warehoused, name and location of the warehouse, name of the insurer of the goods (if 
any ) and such other particulars as are required to identify the goods and indicate their 
value.  
2. A pledge deed stating all the data mentioned in the storage receipt shall be attached to 
each storage receipt.  
3. The warehouseman shall keep one true copy of the original storage receipt and the pledge 
deed.  
  
Article (182 ) 
Where the goods stored in respect of which a storage receipt and a pledge deed have been  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 70 issued are fungible, they may be replaced by goods of the same nature and quality provided 
that a stipulation to that effect has been included in both the storage receipt and the pledge deed. In such case, all the rights and privileges of the receipt or pledge deed holder shall 
transfer to the new goods.  
  
Article (183 ) 
1. The storage receipt and the pledge deed  may be issued in the name of or to the order of 
the bailer.  
2. Where the storage receipt and the pledge deed are made to the order of the bailer, he may 
assign them together or separately by means endorsement.  
3. The endorsee of a storage receipt and/or a pledg e deed may request that the endorsement 
be registered along with his domicile and occupation in the copy kept by the 
warehouseman.  
  
Article (184 ) 
1. The endorsement of the storage receipt and the pledge deed must be dated.  
2. Where the pledge deed is endorsed separately from the storage receipt, the endorsement 
shall be accompanied by the authorization condition and shall include the sum of the debt 
secured by the pledge, the maturity date, the creditor's name, occupation, domicile and 
the signature of the endo rser.  
3. The endorsee shall request that the pledge deed endorsement as well as any relevant particulars to be registered in the books of the warehouse and that the pledge deed be 
marked up with such endorsement and particulars.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 71 Article (185 ) 
1. The holder of  both the storage receipt and pledge deed may receive goods warehoused. 
However, he may request that the goods be divided into several batches and to receive a 
storage receipt and pledge deed for each batch.  
2. The holder of the pledge deed alone without the storage receipt shall have the right of pledge on the goods warehoused.  
3. The holder of the storage receipt alone without the pledge deed may recover the goods 
warehoused; provided that he pays the debt secured by the pledge deed if such debt is 
due, and if not, he may recover the goods before the maturity date of the debt, and he deposits with the warehouseman a sufficient sum to pay off the debt with its interest and 
expenses until it falls due. This provision shall apply if the debt is due and the holder o f 
the pledge deed fails to appear to cash it. The recovery of the goods warehoused may be restricted to one potion thereof after paying a sum that is proportionate to the value of 
such portion.  
  
Article (186 ) 
Where the debt secured by the pledge deed is n ot paid on the maturity date, the holder of the 
pledge deed separate from the storage receipt may request for the goods pledged to be sold, 
pursuant to the procedures set forth in article (170) above.  
  
Article (187 ) 
1. The mortgagee shall have a priority rig ht over all creditors for collecting his right from the 
price of the goods after deduction of the following amounts:  
a. Taxes and duties due on the goods;  
b. Judicial expenses incurred for the joint interest of creditors; and   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 72 c. Expenses incurred for the safekeeping, storage and sale of goods.  
d. Any amount exceeding the sum of money due to the holder of the pledge deed 
shall be paid to the holder of the storage receipt if he is present at the time of the 
sale of goods. If he is not present, the sum shall be deposited in the treasury of the 
court which has ordered the sale.  
  
Article (188 ) 
1. The holder of a pledge deed may not have recourse against the debtor or endorsers until 
the execution over the mortgaged goods has been effected and it has been established that it is insufficient to pay off the debt.  
2. The holder of a mortgage deed shall have recourse against the endorser within (15) fifteen days from the date on which goods are sold, otherwise his action shall be rejected in case 
of denial.  
3. In all cases, the action of holder of a mortgage deed for recourse against endorsers shall be barred if he fails to initiate the execution proceedings against the mortgaged goods 
within (30) thirty days from the maturity date of the debt.  
  
Article (189 ) 
Where the goods sto red suffer an accident, the holder of the storage receipt or the pledge deed 
shall have all the rights over the insurance sum which accrues upon the occurrence of such accident as those he had over the goods.  
  
Article (190 ) 
1. In case of loss or perishing of the storage receipt, the holder thereof may apply to the Civil 
Court to which jurisdiction the public warehouse pertains for an order to be issued to  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 73 deliver a copy to him of the said receipt; provided that he establishes his ownership 
thereof and provides a sufficient guarantor or security.  
2. In case of loss or perishing of the pledge deed, the holder may obtain an order from the 
court against the debtor for repayment of the secured debt upon maturity; provided that 
he produce s a sufficient guarantor or security. If the debtor fails to execute the order, the 
person in whose favor the order is issued may request that the goods mortgaged to be 
sold, pursuant to the procedures set forth in article (170) above; provided that the 
endorsement has been registered in the copy kept by the warehouseman, and that the 
notice requiring the repayment contains the particulars of such endorsement.  
  
Article (191 ) 
1. A guarantor who has been presented in the case of loss of the storage receipt shall be discharged of liability upon recovery of the goods or upon the lapse of (3) three years if 
no claim for the recovery of the goods is submitted to the warehouse.  
2. A guarantor who has been presented in the case of loss of the pledge deed shall be discharged of liability upon the lapse of (3) three years from the date of registering the 
endorsement in the books of the public warehouse.  
  
Article (192 ) 
1. Where the bailer fails to recover the goods upon the expiry of the warehousing contract, 
the warehouse man may request the sale thereof, pursuant to the procedures set forth in 
article (170) above. He shall collect the sums due to him from the proceeds of the sale and 
shall hand over the balance to the bailer or deposit such balance in the court treasury fo r 
the bailer's account.  
2. The provision of Clause (1) above shall apply if the storage term is indefinite, and one year  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 74 lapses and the bailer does not request to recover the goods or express his desire to 
continue in the warehousing contract.  
  
Article (193 ) 
1. Without prejudice to any severer penalty, any person who establishes or invests a public 
warehouse without obtaining the license set forth in Clause (2) of article (176) above shall 
be sentenced to imprisonment and/or a fine not less than (AED 20,000) twe nty thousand 
dirhams and not more than (AED 100,000) one hundred thousand dirhams.  
2. The court may, in case of conviction, order the closure of the warehouse until the violator obtains the required license, and it may also order the liquidation of the wareho use.  
  
Part F ive 
Stock  and  Commodities  Market  
Article (194 ) 
A stock market or a commodities market may be opened in the State only after obtaining the 
necessary licenses according to the legislation governing stock markets and commodity 
markets in force in  the State.  
  
Part S ix 
Commercial Agency  
Chapter O ne 
General Provisions  
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 75 Article (195 ) 
1. An agency shall be commercial when it relates to commercial activities.  
2. The application of the provisions set out in this Part shall be effected  in so far as they do 
not contradict the Law of Commercial Agencies, referred to in this Law.  
  
Article (196 ) 
1. A commercial agency shall be deemed paid, save where otherwise agreed upon.  
2. Where the agent's remuneration is not fixed in the agreement and is not stated in the Law, 
it shall be fixed according to customs, and in the absence of custom, the court shall estimate it.  
  
Article (197 ) 
The remuneration shall accrue to the agent by the mere execution of the transaction assigned to him or if he proves th at it was not executed due to reasons attributed to the principal. In all 
other cases, the agent shall be entitled to only a remuneration for his efforts and expenses to 
be paid in accordance with customs (if any) or pursuant to the court's estimation in t he 
absence of customs.  
  
Article (198 ) 
A commercial agency, even though it has a general power of attorney, shall apply only to 
commercial business, save where otherwise agreed upon.  
  
Article (199 ) 
Where the commercial agency is granted for a specific com mercial transaction, the agent may 
carry out all actions required to execute such transaction with no need to obtain an  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 76 authorization from the principal.  
  
Article (200 ) 
1. The agent shall adhere to the compulsory and express instructions of the principal. If  he 
violates such instructions without an acceptable excuse, the agent may refuse the 
transaction. However, as for guidelines issued by the principal, the agent shall have the 
exclusive authority to act within the scope of the general objectives set by the  principal for 
the agent.  
2. Where no express instructions are dictated by the principal concerning the transaction, 
the agent shall delay its execution and request instructions from the principal, unless the 
delay in implementing the transaction may cause damage to the principal or unless the 
agent is authorized to act without instructions from the principal.  
3. The agent may delegate a third party to implement the agency if he is so authorized by the principal.  
  
Article (201 ) 
Where the agent implements the tas ks assigned to him under conditions that are more 
beneficial than those stipulated in the agency, he may not acquire the difference which in such a case belongs to the principal, save where otherwise agreed upon.  
  
Article (202 ) 
Where the goods or items he ld by the agent for the account of the principal are highly 
perishable or are subject to value declination and no instructions are received from the principal in this respect within a reasonable time, the agent may raise a prompt request to the 
court for authorization to sell them and determine the method of sale.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 77   
Article (203 ) 
The agent may refrain from performing the work entrusted to him where performance 
requires exorbitant expenses which have not been paid by the principal, unless otherwise 
agreed upon between the two parties or unless there are previous dealing between them 
stating that such expenses shall be paid by the agent.  
  
Article (204 ) 
Where the agent refuses to execute the transaction entrusted to him, he shall forthwith notify the princip al thereof. In such case, the agent shall keep safe the goods and other things which 
he keeps for the principal until he receives instructions in this respect. If the instructions are not received within a reasonable time, the agent may request the court t o authorize him to 
deposit the goods and other things with a trustee to be appointed by the court.  
  
Article (205 ) 
The agent shall be liable for such damage and loss as are suffered by the goods and other items which he keeps for the principal, save where such damage or loss has been arisen by an 
external cause beyond the agent's control of the agent or from a defect that is inherent in the 
goods or items.  
  
Article (206 ) 
The agent shall not be bound to insure the items which he keeps for the principal unle ss the 
latter so requires, or where the insurance is obligatory according to the law or custom, or if the nature of the item so dictates.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 78 Article (207 ) 
1. The agent may not constitute himself as a second party to the transaction assigned to him 
for execution except in the following cases:  
a. If the principal authorizes him to do so;  
b. If the principal's instructions concerning the transaction are express and specific and 
precisely executed by the agent; and  
c. If the transaction is related to a commodity which has a fixed price in the market and 
the agent has bought it for himself or has sold it to the principal from his own money 
at such price.  
d. The agent shall not be entitled to any remuneration against the agency in the above 
cases.  
  
Article (208 ) 
A third party de aling with the agent may request to peruse the agency contract, 
correspondence and other documents establishing the agent's authority. Any restrictions to 
the agent's authority shall not be valid vis -à-vis third parties, except if it is established that 
such parties were aware of such restrictions at the time of concluding the contract.  
  
Article (209 ) 
The agent shall inform the principal of the transactions he concludes for the principal's account.  
  
Article (210 ) 
The agent shall submit to the principal on the agreed date or on the date fixed by custom or 
by their previous dealings an account of the business carried out for his account. Such account  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 79 shall be in conformity with the facts. If false particulars have be en premeditatively included 
therein, the principal may reject the relevant transactions and shall further be entitled to claim 
damages. The agent shall not receive any remuneration for the said transactions.  
  
Article (211 ) 
The agent may retain possession of the goods and other items dispatched to, deposited with 
or delivered to him, as a security for the remunerations and expenses due to him from the 
principal.  
  
Article (212 ) 
Both parties to the commercial agency contract may terminate it at any time, and  no 
compensation is due except if the termination occurs without prior notice or at an inconvenient time. Where the contract has a fixed term, it may be terminated only for a serious 
and acceptable reason, otherwise compensation will be required.  
  
Article (213 ) 
Where the principal does not have a known domicile in the State, the domicile of his agent 
shall be deemed to be his domicile. He may be litigated against and have official papers served 
to such domicile with regard to the business conducted by the agent for the principal.  
  
Article (214 ) 
Anything related to the regulation of commercial agency business shall be governed by the 
relevant laws.  
    
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 80 Chapter T wo 
Certain  Types  of Commercial Agencies  
Article (215 ) 
I :Contract Agency  
1. A contract agency is a contract whereby an agent undertakes to carry out, continuously 
and in a specific area of activity, instigation and negotiation in order to conclude 
transactions for the benefit of the principal in return for a remuneration. The contracts 
agent's task may include the conclusion and implementation of such transactions in the 
name of the principal and for his account.  
2. A contract agency shall be in writing and shall indicate in particular the scope of agency, 
remuneration of the agent, area of activity, contract term, in case of a fixed -term contract, 
and the trademark (if any) of the commodity subject of the agency.  
  
Article (216 ) 
A contract agent shall carry out his agency and manage his commercial activity in an 
independent manner, and shall solely bear the  expenses necessary to conduct his activity.  
  
Article (217 ) 
Where the contract stipulates that the contract agent shall set up showrooms, warehouses for 
goods or maintenance or repair facilities, the contract term may not be less than five years, 
unless o therwise agreed.  
  
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 81 Article (218 ) 
1. The contract agent may not receive the principal's rights, unless the principal grants him 
this right, and in which case, the agent may not make any reduction or grant a time limit 
without obtaining a special authorization therefor.  
2. The contracts agent may receive such orders as are related to the performance of the contracts entered in through him, as well as any complaints concerning the non-
performance of such contracts. He shall further be deemed as the representative of his 
principal in the actions relevant to said contracts, whether filed by or against him, in the 
area of activity of the agent.  
  
Article (219 ) 
1. The principal shall pay the agreed remuneration to the agent.  
2. Such remuneration may be a perce ntage of the transaction value, which shall be 
calculated on the basis of the price of sale to the customers, unless otherwise agreed.  
  
Article (220 ) 
The contracts agent shall be entitled to a remuneration for transactions concluded by him or 
for those wh ose non -conclusion is due to the principal's act, unless otherwise stipulated by 
the contract.  
  
Article (221 ) 
The principal shall provide the agent with all information necessary for the implementation of the agency.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 82 Article (222 ) 
1. The contracts agent shall be bound to safeguard the principal's rights and he may take all 
the precautionary measures to that effect. He shall as well provide the principal with the 
information pertaining to the market condition at the area of his activity.  
2. The contracts agent may not, even after termination of the contractual relationship, divulge the principal's secrets which may come to his knowledge as a result of the 
execution of the agency.  
  
Article (223 ) 
In the event where the principal replaces the contracts agent by a new agent, the latter shall 
be jointly responsible with the principal for the payment of the compensation decided by the 
court to the previous agent whenever it is established that the replacement of the previous 
agent was a result of collusion between t he principal and the new agent.  
  
Article (224 ) 
Notwithstanding the rules of jurisdiction provided for in the Civil Procedure Code, the court 
within its jurisdiction the contract performance is located shall be competent to hear all 
disputes arising from the contracts agency.  
  
Article (225 ) 
A distribut ion contract whereby a merchant undertakes to promote and distribute products 
of an industrial or commercial facility in a specific area on an exclusive distributorship basis, shall be considered as a contract agency, and shall be governed by the provision s of Articles 
(218), (223) and (224) hereof.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 83 Article (226 ) 
In case of denial and lack of lawful excuse, all cases arising from a contract agency shall be 
barred after the lapse of (3) three years from the termination of the agency.  
  
Article (227 ) 
II: COMMISSION AGENCY 
1. A commission agency is a contract whereby the agent undertakes to carry out in his own name a legal act for the account of the principal against a commission to be received from 
the principal.  
2. Where the commission agent carries out the legal act in the name of the principal, he shall be governed by other general provisions of the commercial agency.  
  
Article (228 ) 
1. Where the commission agent sells at a lower price or buys at a higher price than that fixed 
by the principal, and the latter wishes to refute the transaction, the principal shall notify 
the agent thereof within one week from the date on which he is informed that said 
transaction was concluded, otherwise, he shall be considered as having accepted the 
price.  
2. The principal may not reject the transaction if the agent accepts to bear the price 
difference.  
  
Article (229 ) 
1. Where the commission agent buys for the account of the principal goods of a type or 
category that is different from that requested by the principal, the latter shall not be bound 
to accept the same.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 84 2. Where the commission agent buys goods which are in conformity to the goods requested 
but in a larger quantity, the principal shall be bound to accept only the quantity which he requested.  
  
Article (230 ) 
Where the commission agent enters into a contract with conditions better than the ones identified by the principal, the benefit shall be reverted to the principal. However, the agent 
shall provide his statement of account based on the real conditions whereby the transaction 
has been made.  
  
Article (231 ) 
1. Where a commission agent who is assigned to sell grants the buyer, without the 
permission of the principal, is given a time limit for payment of the price or makes the price 
payable by installments, the principal may  require the commission agent to pay the whole 
price immediately. In such case, the commission agent may retain for himself the price difference and its interests (if any).  
2. Nevertheless, the commission agent may grant a time limit for payment of the price or 
make the price payable by installments, without the principal's permission, if it is the 
custom to do so at the area where the sale is effected, save where the principal's 
instructions bind the agent to effect the sale on an advance payment basis.  
  
Article (232 ) 
Where the instructions of the principal require the commission agent to effect sale against a 
deferred price and the latter effects the sale for an advance payment lower than the same, the 
principal may not require him to pay the price until mat urity of the term fixed by him. In such  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 85 case, the commission agent shall pay the price on the basis of a deferred -payment sale.  
  
Article (233 ) 
1. A commission agent may not change trademarks affixed to the goods received by him 
from the principal or for the principal's account.  
2. Where the commission agent has possession of a whole bunch of goods of the same kind which were dispatched to him by different principals, he shall distinctively label each 
batch of goods.  
  
Article (234 ) 
1. A commission agent may disclose the name of the principal for whose account he enters 
into contract, unless the principal requires him not to do so. The disclosure of the 
principal's name shall not result in a change in the nature of the agency, as long as the 
commission agent e nters into a contract in his name.  
2. The commission agent shall disclose to the principal the name of the third party with whom he contracts if the principal requires him to do so. If he refrains from doing so 
without an acceptable excuse, he may be consider ed as a guarantor of the implementation 
of the transaction.  
3. In all cases, the commission agent shall establish the existence of the third party with 
whom he contracted if the principal requires him to do so.  
  
Article (235 ) 
1. A commission agent shall be directly liable to third party with whom he entered into 
contract, and such third party shall also be directly liable to the commission agent.  
2. A third party with whom the commission agent has entered into contract may not have  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 86 direct recourse against the p rincipal, nor may the latter have direct recourse against such 
third party, unless the Law provides for otherwise.  
  
Article (236 ) 
1. Further to his right of seizure, the agent shall have lien over goods and other items 
dispatched by the principal or stored w ith or delivered to the agent.  
2. Such lien shall secure the agent's remuneration and any expenses and sums he pays on behalf of the principal or he lends to him, along with their interests and other sums that 
may accrue to the agent on account of the agency,  irrespective of whether such amounts 
have been paid before delivery of the goods or items or while they were in the possession 
of the agent.  
3. The said lien shall established without regard to whether the debt has arisen from 
business related to the goods o r items which are still in the agent's possession or to other 
goods or items which had previously been stored with, delivered or dispatched to the agent.  
  
Article (237 ) 
1. The agent shall not have any the right of lien referred to in article (236) above unle ss he 
possesses goods or items for the principal's account. Such possession shall be realized in the following cases:  
a. Where the agent has effectively received the goods or items;  
b. Where the goods or items were placed at his disposal in a public warehouse or  
customs;  
c. Where he possesses the same de jure before their arrival under a bill of lading or any 
other bill of carriage; and   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 87 d. Where he has dispatched the goods and has retained possession thereof under a bill 
of lading or any other bill of carriage.  
2. In case the goods or items subject to the right of lien are sold and delivered to the buyer, 
the agent's lien shall pass on to the price.  
  
Article (238 ) 
The agent's lien shall have priority over all other liens, except judicial expenses and sums due 
to the Gover nment.  
  
Article (239 ) 
1. The execution proceedings adopted for a commercially mortgaged item shall apply to the 
execution against goods and items in possession of the agent.  
2. Where the agent is assigned to sell the goods or items in his possession, he may obtain execution thereon by selling them without having to comply with the proceedings 
referred to Clause (1) above, unless he fails to implement the principal's express 
instructions issued in respect of the sale.  
  
Article (240 ) 
1. Where the commission agent  who is assigned to sell is declared bankrupt before receiving 
the price, the principal may claim payment of the price directly from the buyer.  
2. Where the commission agent who is assigned to buy is declared bankrupt before he 
receives the item sold, the pri ncipal may claim delivery of the item sold directly from the 
seller.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 88 Article (241 ) 
1. A commission agent shall not guarantee the fulfillment of his obligations by the third party 
with whom he contracted, unless he assumed expressly this guarantee, or if such 
guarantee is stipulated by Law, or if it is customary at the area where he carries out his 
activity.  
2. A commission agent, who is guarantor of the fulfillment by the contractor of his 
obligations, shall be entitled to an additional remuneration to be de termined by the court 
where there is no agreement or custom in this respect.  
  
Article (242 ) 
A commission agent may not delegate to a third party the work entrusted to him, unless he 
obtains the permission of the principal to do so. If he delegates another  agent to carry out such 
work, the person delegated shall have no right of seizure or lien except to the limit of the debt due to the original commission agent.  
  
Article (243 ) 
III: COMMERCIAL REPRESENTATION  
A commercial representation is a contract whereb y a commercial representative undertakes 
to conclude, on a permanent basis and within a specific area, transactions in the name and for 
the account of his principal.  
  
Article (244 ) 
A commercial representative shall not warrant the implementation of transactions concluded 
through him, unless he had expressly agreed to such warranty or in case the custom in the 
area where he carries out his activity dictates such warranty.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 89   
Article (245 ) 
1. A merchant shall be liable for any transactions and contracts entered into by his 
representative within the limits of the delegation conferred on him by the merchant.  
2. Where the representative is delegated to by several merchants, they shall jointly assume 
the liability.  
3. If the representative is delegated by a company , the company shall be liable for his work, 
and the partners' liability shall depend on the type of company.  
  
Article (246 ) 
1. Where the limits of the authority vested in the commercial representative have not been 
determined, the authority shall be deemed general and comprehensive for all the transactions 
related to the kind of trade which the representative has been delegated to carry out.  
2. A merchant may not invoke the limitation of delegation against a third party unless he establishes that such third par ty is aware of such limitation.  
  
Article (247)  
A commercial representative shall carry out, in the name of the merchant who conferred 
delegation on him, the commercial activities which he has been authorized to undertake on 
behalf of the merchant. Upon signing the same, he shall place next to his name in full the full 
name of the merchant and shall indicate his capacity as commercial representative, otherwise, he shall be personally liable for his own action. Nevertheless, third parties may have direct 
recourse against the merchant with regard to the transactions concluded by the 
representative in connection with the trade which he has been delegated to carry it out.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 90 Article (248 ) 
A commercial representative may represent the merchant in actions arising f rom the 
commercial transactions carried out by him.  
  
Article (249 ) 
A commercial representative shall be jointly liable with the merchant for complying with the 
law provisions related to unfair competition.  
  
Article (250 ) 
A commercial representative may not carry out any commercial transaction of the kind for 
which he is represented for his own account or for the account of a third party, without the 
express prior consent of the merchant who appointed him.  
  
Article (251 ) 
Where it is agreed that the comme rcial representative shall be the exclusive general 
representative of the merchant in the agreed area, the commercial representative shall be entitled to a commission for each transaction concluded for the account of the merchant in 
such area, even if the merchant has concluded it by himself or if it was concluded through a 
person other than the commercial representative, except if it is established that the failure to 
conclude the transaction through the commercial representative is attributed to a reason 
related to the representative himself.  
  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 91 Part S even  
Brokerage  
Article (252 ) 
Brokerage is a contract whereby a broker undertakes to another person to look for and 
mediate in negotiations with a second party, in order to enter into a specific contract, in  
consideration of a fee.  
  
Article (253 ) 
1. Where the broker's fee is not fixed in the Law or the agreement, it shall be determined according to the customs. In the absence of a custom, the judge shall estimate it according 
to the transaction value, the effort exerted by the broker and the time spent by him while 
carrying out the task assigned to him.  
2. The judge may reduce the fee agreed if it is not commensurate with the nature of the 
transaction and the effort exerted by the broker. No reduction may be d ecided if the fee 
was agreed upon or if it was willingly paid by the customer after the conclusion of the 
contract brokered by the broker.  
  
Article (254 ) 
1. A broker shall be paid for his brokerage if such brokerage results in the conclusion of the contract between the two parties. The contract shall be deemed to have been concluded 
when both parties have agreed on all substantial matters therein.  
2. The broker shall be entitled to receive his fee by the mere conclusion of the contract, even it was not implement ed, unless otherwise required by the Law or custom.  
3. Where the contract is pending to a condition precedent, the broker shall receive the fee 
only when such condition is realized.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 92 4. Where it is impossible to enter into a contract for a reason attributable to the customer, 
the broker shall be entitled to compensation commensurate with the effort exerted.  
  
Article (255 ) 
Where the contract which has resulted from the broker's brokerage is terminated, the broker 
may claim his fee or keep it where he has already received it, unless fraud or serious error is 
established on his part.  
  
Article (256 ) 
Where the broker brokers the conclusion of a legally -prohibited transaction, he shall not 
receive any fee in consideration of such transaction.  
  
Article (257 ) 
1. The broker shall be entitled to receive a fee only from the party to the transaction who has 
delegated him.  
2. Where the broker has been delegated to by both parties, each of them shall be severally 
liable to the broker for payment of the fee due to him, even if they had agreed that either 
party will bear the broker's fee in full.  
  
Article (258 ) 
A broker, even if he is delegated only by one of the transaction parties, shall submit a faithful 
offer to them and inform them of all circumstances known to him, and he shall be liable to 
them for any fraud or fault committed by him.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 93 Article (259 ) 
A broker may not recover the expenses incurred by him in the execution of the task assigned 
to him, unless otherwise agreed. In such case, the said expenses shall be payable even if the 
contract has not been concluded.  
  
Article (260 ) 
A broker may not claim his fee or recover his expenses if he has caused damage to either contracting party in favor of the other contracting party who did not assign him to broker in 
the conclusion of the contract, or where he has obtained a promise from such other party 
contrary to the good faith in order to obtain a benefit for himself.  
  
Article (261 ) 
A broker may not act as second party to the contract for which he acts as a broker, un less the 
contracting party authorizes him to do so. In such case, the broker shall not be entitled to a fee. 
  
Article (262 ) 
1. A broker shall record in regular entries all the transactions concluded through his endeavors, and shall keep the relevant document s, and shall further give a true copy of all 
the foregoing to any contracting party requesting the same. The said entries shall be governed by the same provisions of commercial books.  
2. In case of sale according to samples, the broker shall keep the sample u ntil the goods are 
accepted by the buyer, without any reservation, or until all conflicts are settled between 
the two parties in this respect.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 94 Article (263 ) 
A broker shall be liable to compensate any damage arising from the perishing or loss of 
documents, papers or items delivered to him pertaining to the transaction for which he is 
brokering, unless he proves that such perishing or loss was due to a force majeure event.  
  
Article (264 ) 
A broker may not render brokerage for persons who are reputed for their insolvency, or if he knew them to be unqualified.  
  
Article (265 ) 
1. A broker shall not be required to guarantee the solvency of the two parties to the 
transaction in which he acts as a broker and shall bear no liability for its implementation 
or for the value and quality of the goods related thereto, unless an act of fraud or fault is 
established on his part, or where he acts as a guarantor under the agreement or Law.  
2. The broker shall be jointly liable for the implementation of the transaction with the 
contracting party if he has an interest therein in addition to his fee.  
  
Article (266 ) 
1. Where a broker designates another person to perform the task assigned to him without being authorized to do so, he shall be liable for the designee's action  as if such action has 
been made by him; however, both the broker and his designee shall jointly assume the 
liability.  
2. Where the broker is authorized to designate a designee without naming the person of such designation, the broker shall be liable only for  his fault in selecting his designee or his fault 
in the instructions issued by him to the designee.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 95 3. In all cases, the person who has assigned the broker may have direct recourse against the 
designee.  
  
Article (267 ) 
Where several brokers have been assigne d for one contract, they shall be jointly liable for the 
task entrusted to them, unless they have been authorized to act severally.  
  
Article (268 ) 
Where several persons assign one broker for a joint task, they shall be jointly liable to the same for the p erformance of such task, unless otherwise agreed upon.  
  
Article (269 ) 
Brokerage in stock markets and goods shall be governed by the provisions of the relevant laws and regulations.  
  
Part E ight  
Carriage  
Chapter O ne 
General Provisions  
Article (270)  
A carriage contract is a contract whereby a carrier undertakes to carry by his own means a 
person or an item from one place to another in return for a fee.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 96 Article (271 ) 
Apart from maritime transport, the provisions stipulated in this Part shall apply to all kinds of 
carriage, regardless of the carrier's capacity, subject to those provisions stipulated in the laws 
concerning certain kinds of carriage and the provisions of the international carriage 
conventions applicable in the State.  
  
Article (272 ) 
The provisions set forth in this Part shall apply to carriage even if it is associated with 
operations of another nature, as long as such operations do not constitute the main objective 
of the contract.  
  
Article (273 ) 
1. A carriage contract and a commission agenc y contract for carriage shall be concluded by 
the mere association of an offer and an acceptance, unless both parties agree to defer such 
conclusion to the time of delivery. The contract may be proved by all means of evidence.  
2. The receipt by the carrier of  the item subject to carriage shall be deemed as an acceptance 
by him of the offer made by the consignor.  
3. A passenger's boarding on the means of transport shall be considered as an acceptance of the offer made by the carrier, unless it is established that the passenger's intention was not 
to conclude a carriage contract.  
  
Article (274 ) 
1. Where the carrier uses multiple forms of contracts and the two parties have not agreed to 
adopt a specific form, the carriage shall be effected  according to the form which includes the 
general conditions.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 97 2. Where the two parties agree to adopt a specific form, the conditions stated therein shall be 
indivisible.  
  
Article (275 ) 
1. Where the carrier holds a concession of a certain type of carriage or of  the utilization of 
specific lines of transport, it shall be bound to accept all requests raised to the same, save where a request is contrary to the prescribed carriage conditions or where it is impossible for 
the carrier to execute it for reasons beyond its control.  
2. Where the carriage requests exceed the capacity of the means of carriage which the carrier is 
licensed to use, he shall accept such requests according to their dates of submission, so that 
the request first raised shall have precedence over su bsequent requests, unless some of such 
requests have priority pursuant to the carriage conditions.  
  
Article (276 ) 
The carrier's liability shall cover his acts and those of his subordinates when such acts are 
committed by them in the course of rendering their services. All persons employed by the carrier for the performance of its obligations under the carriage contract shall be considered 
as a subordinate.  
  
Article (277 ) 
1. Explosion, burning, derailing or collision of the carriage means or any other accidents attributed to the tools and machines used by the carrier in the performance of the carriage 
and may constitute a force majeure event in the performance of the carriage contract, even if 
the carrier establishes that he has adopted precautionary me asures to guarantee the 
suitability of said carriage means for work and to prevent the occurrence of damage.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 98 2. Accidents attributed to sudden death or physical or mental weakness of the carriage 
subordinates at work may not constitute a force majeure event, even if the carrier proves that 
he had taken precautionary measures to guarantee their physical and mental fitness.  
  
Article (278 ) 
A carrier may not be held accountable for compensating any damage arising from the disruption of carriage or deviation from the route set due to necessity to provide assistance to 
any sick, injured or endangered person.  
  
Article (279 ) 
1. Fraud in the performance of a carriage contract shall mean any act or omission committed by the carrier or his subordinates with the intent to c ause damage.  
2. A serious error shall mean every act or omission committed by the carrier or his subordinates with imprudence associated with awareness of the damage which may be caused.  
  
Chapter T wo 
Contract  of Carriage  of Things  
Article (280 ) 
1. The consignor  shall provide the carrier with the particulars concerning the consignee's 
name and address, destination of the carriage, kind of items intended for carriage, as well as their value, weight, volume, quantity, packaging and wrapping method, number of parcel s included and any other particulars as are sufficient to identify the item required to 
be transported, in addition to the delivery time limit and the route to be followed.  
2. The consignor shall be held accountable for any damage arising from false or insuff icient 
particulars provided by him.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 99   
Article (281 ) 
1. The bill of lading shall contain, in particular, the following data:  
a. Date of the bill and the location where it was executed;  
b. Names and places of residence of the consignor, consignee, carrier and the commission agent 
(if any);  
c. Place of departure and destination;  
d. Particulars related to the identification of the items carried and their value;  
2. The date fixed for the performance of the carriage;  
a. Freightage and other expenses with an indication of whether t hey are payable by the 
consignor or the consignee; and  
b. Conditions pertaining to the loading and unloading, type of transport means required to be used for carriage, the route to be followed, determination of the liability and any 
other special conditions w hich may be included in a carriage contract.  
3. The bill of lading may be executed in the name of or to the order of a specified person or 
to bearer.  
4. The bill of lading shall be circulated according to the rules of the assignment of rights where it is nominat ive, by endorsement if made out "to order" and by delivery where it is 
made out "to bearer", without being concerned with the carriage or possession of goods.  
  
Article (282 ) 
1. The consignor may require the carrier to hand him a copy of the bill of lading.  
2. Where no bill of lading is executed, the consignor may require the carrier to deliver to him a 
receipt signed by the carrier purporting to the receipt of the item carried. Such receipt shall be 
dated and must include the sufficient particulars to identify the item carried and the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 100 freightage.  
  
Article (283 ) 
The bill of lading and the receipt issued and signed by the carrier purporting to the receipt of 
the item carried shall constitute evidence for the particulars stated therein. Any person 
claiming the con trary to such particulars shall have to establish same.  
  
Article (284 ) 
1. The rights and obligations arising from the carriage contract shall neither be established 
for nor be binding on the consignee, unless he accepts such rights and obligations either 
expressly or implicitly.  
2. The receipt by the consignee of the bill of lading or of the item intended for carriage, as well as his requiring to deliver the same to him or to issue instructions in this respect, shall 
be deemed as an implicit acceptance of rights  and obligations arising from the carriage 
contract.  
  
Article (285 ) 
1. The consignor shall deliver to the carrier the item to be carried and the documents necessary for the performance of the carriage. The consignor shall be held liable where 
such documents are insufficient or untrue. Meanwhile, the carrier shall be liable for the 
loss or misuse of such documents.  
2. Where the carriage requires special preparations, the consignor shall so notify the carrier within sufficient time prior to the delivery of the ite m to be carried.  
3. Delivery shall take place at the place of business of the carrier, unless otherwise agreed 
upon.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 101   
Article (286 ) 
1. Where the nature of the item intended to be carried requires special preparations for 
carriage, including packaging or wrapping, the consignor shall take such precautions as 
would protect it from perishing or damage, and as would not expose the other persons or 
items carried with it to injury or damage respectively. Where the carriage conditions 
require a specific method o f packaging or wrapping, the consignor shall be required to 
adhere thereto.  
2. The consignor shall be further liable for the damage arising from any defect in packaging or wrapping and the carrier shall be jointly liable with the consignor for such damage if he 
has accepted to perform the carriage with his knowledge of the defect. The carrier shall be 
deemed to be aware of the defect if it is apparent or of the type which cannot be concealed 
to an ordinary carrier.  
3. A carrier may not deny its liability for perishing or loss of one of the carried items by proving that the damage has arisen from a defect in the packaging or wrapping of another 
item, and any agreement to the contrary shall be null and void.  
  
Article (287 ) 
1. A carrier may examine the items to be carr ied, in order to verify their condition and the 
authenticity of the particulars provided by the consignor in this respect.  
2. Where such an examination requires the opening of the wrappings or containers, the 
consignor shall be notified to attend the examination. Where the consignor fails to show 
up on the scheduled date, the carrier may undertake the examination in his absence; 
however, the carrier may claim the examination fees from the consignor, unless otherwise 
agreed.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 102 3. Where the examination shows that the condition of the item does not allow its carriage 
without damage, the carrier may refuse to carry it or may carry it after taking from the 
consignor a declaration that he is aware of the condition of the item to be carried and that 
he agrees the carriage thereof. In such case, it is required to establish in the bill of lading 
the condition of the item and the consignor's declaration.  
  
Article (288 ) 
The receipt by the carrier of the items to be carried without any reservations shall constitute 
evidence that he received them in good condition and in conformity with the particulars stated in the bill of lading. Where the carrier claims otherwise, it shall be required to prove it.  
  
Article (289 ) 
1. The carrier shall ship and stack the item to be carried on board of the ordinary means of carriage, unless otherwise agreed.  
2. Where the consignor requires the shipping to be made on board a specific type of means of carriage, the carrier shall not be liable for damage caused by the use of such type of means of carriage, unless it has been caused by its own fault or the fault of its 
subordinates.  
  
Article (290 ) 
1. The carrier shall follow the route agreed upon. In the absence of an agreement for a 
specified route, the carrier shall take the shortest route.  
2. A carrie r may change the route agreed upon or take a longer one where a necessity arises 
compelling it to do so. In such case, the carrier shall bear no liability for the delay and other damage which may result from the change of route, unless fraud or gross fault  is  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 103 established on its part or on the part of its subordinates.  
  
Article (291 ) 
1. The carrier shall ensure the safety of the item during the performance of the carriage 
contract.  
2. Where the safekeeping of the item during carriage route necessitates re -packaging or 
repair, increase or decrease of wrapping or any other necessary measures, the carrier shall 
undertake this and pay any costs required therefor, unless otherwise agreed upon. 
Notwithstanding the foregoing, the carrier shall not be committed to take any 
extraordinary measures in the transport such as the supply of food and water to animals, 
provide medical services or other services or irrigate plants, unless otherwise agreed upon.  
  
Article (292 ) 
1. The carrier shall unload the item upon arrival, unless unloading is carried out by the consignee or another person under an agreement, law, regulation or instructions. In such 
case, the carrier shall not be liable for any damages resulting from the unloading.  
2. In all cases, the carrier shall bear the u nloading costs, unless otherwise agreed upon.  
  
Article (293 ) 
1. Where the delivery is not required at the place of the consignee, the carrier shall notify him of the arrival of the item carried and of the time on which he may take delivery 
thereof.  
2. The consignee shall receive the item on the date fixed by the carrier, otherwise, he shall 
bear the storage fees. Upon the expiry of the time limit set for delivery, the carrier may carry the item to the consignee's place in consideration of additional freight age.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 104 3. The consignee may require to examine the item before receiving it, and if the carrier fails 
to enable him to do so, the consignee may refuse to receive the item.  
  
Article (294 ) 
1. Where the item to be carried is in possession of the carrier, the consign or may order him 
to refrain from executing the carriage, to stop it or to return the item to him, or to direct it to a person other than the original consignee or to any other place or issue any other 
instructions; provided that the consignor shall pay the  freightage and costs of that part 
performance of the carriage and compensate the carrier for any damage he may have 
sustained as a result of the new instructions. Where the consignor receives a copy of the 
bill of lading, he shall return it to the carrier , so that he enters therein the new instructions 
which shall be signed by the consignor, otherwise, the carrier may refrain from 
implementing such instructions.  
2. The right to issue instructions concerning the item carried shall pass on to the consignee by t he mere fact that he receives the bill of lading or when he accepts expressly or 
implicitly the carriage contract. In which case, the bill of lading shall be returned to the carrier to record therein the new instructions which shall be signed by the consig nee, 
otherwise, the carrier may refrain from implementing same.  
No new instructions related to the item to be carried may be issued, after the arrival of the transported item and the request of the consignee to receive it or notifying the consignee 
to atte nd to receive it.  
  
Article (295 ) 
The carrier shall execute the instructions issued to him by whomever is entitled to do so, pursuant to the provisions of article (194) above, unless the carriage conditions prohibit the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 105 same, or unless it is impossible for  the carrier to execute such instructions, or if execution 
thereof would cause a disturbance in the traffic, or if the value of the item carried is not 
sufficient to cover the expenses incurred by the carrier due to execution of the instructions. In 
all such cases, the carrier shall notify the person who issued the new instructions of his 
abstention from execution and the reason for such abstention. The carrier shall not be liable 
for said abstention, unless it is unreasonably withheld.  
  
Article (296 ) 
1. Wher e an obstacle prevents the commencement of carriage, or if the carriage is disrupted 
during its execution, or if the consignee fails to appear to receive the item carried, or if he 
appears but abstains form paying the freightage or expenses due, the carrie r shall notify 
the consignor accordingly and seek further instructions. Notwithstanding the provisions of article (294) above, the carrier shall implement the instructions received by him from 
the consignor, even if he fails to return a copy of the bill of  lading given to him by the 
carrier.  
2. Where the consignor fails to issue instructions in a timely manner, the carrier may appeal 
the court to state the condition of the item and to authorize him to store it with a trustee 
for the account of the consignor an d at the consignor's liability.  
3. Where the item is perishable or subject to the declination of value, or where its 
maintenance costs are exorbitant, the court may order to be sold in the manner specified 
by it and the price shall be deposited in the court t reasury for the account of the persons 
concerned.  
  
Article (297 ) 
The consignor shall pay to the carrier the freightage and other costs which may accrue, save  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 106 where it is agreed that they shall be borne by the consignee, in which case, both the consignor 
and consignee shall be jointly liable to pay them to the carrier.  
  
Article (298 ) 
The carrier shall not be entitled to freightage in respect of such items perished in 
consequences of a force majeure event.  
  
Article (299 ) 
1. Where a force majeure event prevents the execution of carriage, no freightage shall accrue 
to the carrier. However, if said force majeure event hinders the carriage from being 
completed, the carrier shall be entitled to receive the freightage for the part performance 
of the carriage.  
2. In all cases, the carrier may claim payment of the loading and unloading costs and other 
necessary costs.  
  
Article (300 ) 
The right to claim for the recovery of the sum paid in surplus to the freightage agreed or 
prescribed in the carriage conditions shall be vested in the person who paid the freightage.  
  
Article (301 ) 
1. The carrier may withhold the item carried in satisfaction of the freight, expenses and other 
sums payable thereto.  
2. The carrier shall have a lien over the price collected from the enforcement against the 
items carried, in satisfaction of the freight and other sums payable to the carrier because 
of the carriage. The provisions regulating the procedures of enforcement against  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 107 commercially -pledged items shall apply in this regard.  
  
Article (302 ) 
1. From the moment the carrier receives the item to be carried, the same shall be held 
accountable for its destruction, in whole or in part, damage and delayed delivery thereof.  
2. An it em shall be deemed totally perished if the carrier fails to deliver it or to notify the 
consignee to attend to receive it within (30) thirty days following the expiry of the time 
limit set for delivery, or upon the expiry of the time limit usually required  by an ordinary 
carrier for the carriage had it been in the same circumstances or if no date for delivery has 
been fixed.  
  
Article (303 ) 
The carrier shall not be liable for destruction or impairment of the item carried after being 
delivered to the consign ee, the agreed- upon customs point or the trustee appointed by the 
court for safekeeping of the item, except where fraud or gross fault is established on the part of the carrier or its subordinates.  
  
Article (304 ) 
1. The carrier shall not be held accountable for any loss in weight or volume that usually 
occurs to the item during the carriage process due to its nature, unless it is proved that such a loss has resulted from any other cause.  
2. Where the bill of lading covers several items divided into groups or par cels, the tolerable 
loss of weight shall be determined on basis of the weight of each group or parcel in case such a weight is, or could have been, specified separately in the bill of lading.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 108 Article (305 ) 
Where the item is carried in the custody of the consignor or consignee, the carrier shall not be 
liable for its destruction or damage, unless fraud or gross fault is proved on the part of the 
carrier or its subordinates.  
  
Article (306 ) 
The carrier may not deny its liability for the destruction, damage,  or delayed delivery, of the 
item carried, save where the same proves a force majeure event, a defect inherent to the item 
carried, a fault committed by the consignor or consignee or an act of the Government.  
  
Article (307 ) 
1. Any condition relieving the carrier from liability for total or partial destruction or damage 
of the item carried shall be null and void. Moreover, any condition relieving the carrier of 
such liability if arising from the acts of its subordinates shall also be null and void. Any condition that would bind the consignor or consignee, in any capacity whatsoever, to pay 
all or part of the insurance expenses against the carrier's liability shall be deemed as an act 
of relief from liability.  
2. The carrier may require its total or partial relief from liability for delayed delivery.  
  
Article (308 ) 
1. The carrier may require that its liability for the total or partial destruction or damage of the 
item be limited; provided that the liquidated damages are not fictitious, and the same shall 
be subject to the court's discretion in case of conflict.  
2. The liquidated damages shall not be payable if the carrier proves that the consignee did not sustain any damage.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 109 3. Where the damage value is less than the amount of the liquidated damages, the judge may 
reduce such amount to make it equivalent to the damage value. Nevertheless, where the 
damage exceeds the liquidated damages amount, it is not permissible to claim more than 
such amount, unless it is established that the carrier or its subordinates have committed 
fraud or a gross fault, as in the latter case, the carrier shall indemnify the damage in full.  
  
Article (309 ) 
The condition for limitation of, or relief from liability for delayed handover shall be 
established in writing, otherwise, it shall be deemed null and void. Where the carriage contract is executed on printed forms, the said condition shall be clear and explicitly stipulated; 
otherwise, the court may consider it null and void.  
  
Article (310 ) 
The carrier may not invoke the condition of liability lim itation or relief for delayed delivery 
where fraud or gross fault is proved on its part or on the part of its subordinates.  
  
Article (311 ) 
1. Where the item carried is perished or damaged and its value is not indicated in the bill of 
lading, the indemnity shall be determined on the basis of its real value at the venue and 
time of arrival, unless otherwise stipulated by law or agreement. Save in case of total 
destruction, the indemnity shall be determined taking into account the tolerable loss 
permitted according to the customary practices.  
2. Where the value of the item carried is indicated in the bill of lading, the carrier may object 
to the same a nd prove, by all means of evidence, the real value of the item.  
3. Apart from fraud and gross fault committed by the carrier or its subordinates, the carrier  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 110 shall not be held accountable for the loss of the item entrusted to it for carriage, including 
money,  commercial papers, jewelries or any other precious items, except to the extent of 
the express written particulars provided by the consignor at the time of delivering the item 
for carriage.  
  
Article (312 ) 
1. No indemnity shall be concurrently claimed for bot h total loss and delayed delivery of the 
item carried.  
2. The indemnity for total destruction loss shall include the value of the item perished and 
any loss sustained by the claiming party in consequences of such destruction.  
3. The indemnity for delayed deliver y shall, in case of partial destruction, awarded only for 
the undestroyed part.  
4. In all cases, the court -ordered indemnity shall not exceed the indemnity amount falling 
due in the event of the total destruction of the item.  
  
Article (313 ) 
Where the item is  partially damaged or perished or its delivery is delayed, so that it no longer 
becomes valid for the purpose of its use, and the carrier's liability for such damage, destruction 
or delayed delivery is established, the party claiming indemnity may waive th e item in favor 
of the carrier against indemnity to be determined on basis of the total destruction of the 
underlying item.  
  
Article (314 ) 
1. Where indemnity is paid due to the item destruction, but then the underlying item is found 
within one year following  such payment, the carrier shall forthwith notify the indemnity - 
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 111 receiving person of the same and ask such a person to attend to inspect it at the place 
where it has been found, the place of departure or the place of arrival, at his option.  
2. Where the indemnity -receiving person fails to send his instructions within (15) fifteen 
days of the date of receiving the notification, if he sends the instructions but fails to attend 
on the date fixed by the carrier for inspection, or if he attends but refuses to get th e item 
back, the carrier may then dispose of the item.  
3. Where the indemnity -receiving person requests that the item be returned to him, he shall 
refund the indemnity received after deducting the expenses of the claim plus a sum 
equivalent to the damage sust ained due to the delayed delivery of the item.  
  
Article (315 ) 
1. Receipt of the items carried and payment by the consignee of the freight shall invalidate 
any legal proceedings against the carrier if the defect that had occurred therein is 
apparent. However,  where such defect is not apparent, it may be proved, but the legal 
proceeding instituted on the ground of such defect shall only be admitted if a notice is served regarding the defect within (72) seventy -two hours of the time of receipt, and the 
claim is submitted to the court within (30) thirty days.  
2. The condition of the goods shall be established either by the competent authorities or by an expert appointed by the court on an urgent basis.  
3. The provisions of this Article shall not apply where it is established that the defect was a result of fraud or gross fault committed by the carrier or its subordinates or where it is 
established that the carrier and its subordinates have intentionally concealed the defect.  
4. The receipt of movables for which a contractual relationship is established on or via modern means of technology shall be governed by the rules and provisions set forth in 
the relevant statutes.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 112   
Article (316 ) 
1. Where several carriers successively perform a single carriage contract, the first carrier shall 
be liable towards the consignor and consignee for the whole carriage operation, and any 
provision to the contrary shall be null and void.  
2. Each of the carriers subsequent to the first one shall only be liable towards the latter or towards the consigno r or consignee for the damage occurring in the part of carriage 
performed by it. Where it is not possible to identify the part in which the damage occurred, 
the indemnity shall be divided between all the carriers in proportion to each carrier's share 
in th e freight. In case any of such carriers is insolvent, its share shall be divided among the 
others in accordance with the same proportion.  
3. The carrier proving that the damage did not occur in the part of carriage executed by it 
shall be relived from the liability.  
  
Article (317 ) 
Each of the consecutive carriers may require that the item carried be examined and its 
condition be established upon delivery thereof to it by the preceding carrier. Where the carrier 
receives such an item without making reservation s, it shall be assumed that it has received it 
in a good condition and in conformity with the particulars stated in the bill of lading, unless evidence to the contrary is furnished.  
  
Article (318 ) 
The last carrier shall be liable towards the preceding one s for claiming payment from the 
consignee of the sums due because of the carriage, and it may collect such sums on their behalf and take all legal measures for collection thereof, including, among others, the use of  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 113 the right of withholding, and the right of lien over, the item subject of carriage.  
  
Article (319 ) 
In case of denial and lack of lawful excuse, the following legal proceedings shall be barred:  
1. Legal proceedings instituted against the carrier on the grounds of delayed delivery, 
destruction or damage arising from a contract of carriage of items after (6) six months in 
respect of carriage within the State and after (1) one year in respect of overseas carriage, 
as of the date of delivery of the item to the consignee, the customs point or the trust ee 
appointed by the court for safekeeping the item. In case of total destruction of the item 
carried, the limitation period shall commence as of the expiry date of the time limit 
stipulated in article (302.2) above.  
2. The legal proceeding instituted by one c arrier as a recourse against the consecutive 
carriers, pursuant to article (316.2) above upon the passage of (60) sixty days of the date 
of payment of the indemnity or of the date of the formal claim for indemnity.  
  
Article (320 ) 
Any person or subordinate  of a person having committed an act of fraud or gross fault may 
not invoke the limitation period of legal proceedings set forth in article (319) above.  
  
Chapter T hree  
Passenger  Carriage  Contract  
Article (321 ) 
1. A passenger shall pay the carriage fare on the date agreed upon or the date stated in the carriage schedules or as dictated by the customary practices, and shall abide by the 
carrier's instructions with regard to the carriage.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 114 2. The carrier shall carry the luggage carried by the passenger during the travel, and the 
passenger shall not pay any fare for the transport of his luggage, except where such luggage exceed the maximum threshold stated in the carriage tariff or the threshold  
recognized by customary practices.  
  
Article (322 ) 
1. Where a force majeure event prevents the commencement of carriage or where, before 
execution of carriage, circumstances occur rendering such carriage a threat to lives, the 
carrier shall not pay any indem nity on the grounds of failure of execution, nor shall the 
latter be entitled to receive the fare.  
2. Where the force majeure event or threat to lives arises after commencement of execution of carriage, the carrier shall receive the fare only for that part of  carriage executed by it.  
  
Article (323 ) 
Where carriage is not possible because of death or illness of the passenger or due to any other compelling impediments, the carriage contract shall be terminated and the fare shall not be payable.  
  
Article (324 ) 
1. Where the passenger decides against travelling before its commencement, he shall notify the carrier of his decision before the date set for execution of the carriage. In case of 
extreme necessity, such notification may be served on the same day.  
2. Where the notice is served according to Clause (1) of this Article, the carrier's fare shall not 
be payable. However, the carrier may claim compensation for the damage sustained by it due to the fact that the passenger has refrained from the carriage.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 115   
Article (325 ) 
Where the passenger refrains from continuing the trip after commencement thereof, the full 
fare shall be payable, unless his refrainment is attributed to extreme necessity, in which case, 
he shall pay only the fare corresponding to the executed part of c arriage.  
  
Article (326 ) 
Without prejudice to the provisions of Articles (324) and (325) hereof, where the passenger fails to attend on the time scheduled for carriage, he shall pay the full fare and he may, 
whether he paid the full fare before or after th e date scheduled, request that the carriage be 
executed on a later date, unless otherwise agreed.  
  
Article (327 ) 
1. Where carriage is cancelled prior to the commencement or completion thereof for a 
reason attributable to the carrier or its subordinates or th e means of carriage used by it, 
the passenger shall not be required to pay the fare, without prejudice to the passenger's 
right to claim compensation, if applicable.  
2. Where carriage is disrupted after the commencement thereof for a reason attributed to 
the carrier or its subordinates or the means of carriage used by it, the passenger may 
refrain from continuing the trip and the carrier shall, in this case, bear the costs of carrying 
the passenger to the agreed -upon place. However, the passenger may choose to  wait until 
the traffic resumes and shall not be required in such case to pay any additional fare.  
  
Article (328 ) 
The passenger may, before commencement of execution, relinquish the carriage ticket, unless  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 116 it is issued in the passenger's name or delivered  to him based on special considerations.  
  
Article (329 ) 
1. The carrier shall prepare for the passenger a seat in the agreed -upon class, and the latter 
may recover from the carrier the difference in case he is compelled to travel in a lower 
class than the one  indicated on his ticket.  
2. Where the passenger pays an additional fare against special benefits, he may claim that such additional fare be reimbursed to him if the carrier fails to provide the corresponding 
benefits.  
  
Article (330 ) 
1. The carrier may withhold  the passenger's luggage in satisfaction of the fare and the price 
of food or other items served to him during the performance of the carriage contract.  
2. The carrier shall have lien over the price of the passenger's luggage in satisfaction of the 
carriage f are and other amounts payable to it due to carriage. The proceedings of 
enforcement against commercially pledged items shall apply in this respect.  
  
Article (331 ) 
1. The carrier shall carry the passenger and his luggage to the destination place on the date agreed upon, and if no date is specified, then within the time limit required by an ordinary 
carrier under the same circumstances.  
2. The carrier may, prior to carriage commencement or during the trip, examine the 
passenger's luggage in his presence to ensure  their conformity with the carriage 
conditions.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 117 Article (332 ) 
1. The carrier shall be liable for the safety of the passenger during the performance of the 
carriage contract, and any agreement relieving the carrier from such liability shall be null 
and void.  
2. The performance of a carriage contract shall cover the period between the moment the passenger starts to board the means of transport at the place of departure until he 
disembarks at the place of arrival. Where there are quays/platforms for the means of 
transport to lay by, the performance of the contract shall cover the period lying between 
the moment the passenger embarks the quay/platform at the place of departure and his 
exit therefrom at the place of arrival.  
3. Where necessity arises during the trip to replace the means of transport, the liability shall not cover the period of transfer of the passenger from one means of transport to the other 
without the custody of the carrier or its subordinates or agents.  
  
Article (333 ) 
1. The carrier shall be liable for  the delayed arrival and for such bodily or non -bodily injuries 
sustained by the passenger during the performance of the carriage contract.  
2. The liability set out in Clause (1) shall only lapse if the carrier proves that the delay or 
injury is due to force majeure, the passenger's fault or a third party's act.  
  
Article (334 ) 
1. Any condition that relieves the carrier, in full or in part, from liability with regard to bodily injuries sustained by the passenger shall be null and void.  
2. Any condition which aims to make the passenger, in any way, compelled to pay all or any 
of the insurance expenses against the carrier's liability shall be deemed as an act of relief  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 118 from liability.  
  
Article (335 ) 
1. The carrier may stipulate a condition relieving itself from the liability, in full or in part, 
arising from the delay of the passenger and non -bodily injuries that may be sustained by 
the latter in the course of carriage.  
2. The condition of relief from liability shall be executed in writing, otherwise, it shall be 
considered null and void. Where the carriage contract is executed on printed forms, the 
condition shall be clear and explicitly stipulated; otherwise, the court may consider it null 
and void.  
3. The carrier may not invoke the condition of relief from liability, in full or in part, where an 
act of fraud or gross fault is proved on the part of the carrier or its subordinates or agents.  
  
Article (336 ) 
1. Passengers shall watch over their own luggage and animals permitted to be carried with th em. 
The carrier shall not be liable for any loss or damage which may be sustained by the same, save where the passenger proves that such loss or damage is due to a fault by the carrier or its 
subordinates.  
2. The passenger shall be liable for the damage sustained by the carrier or third parties due to the luggage or animals carried with him.  
3. As for the luggage delivered to the carrier, the carriage thereof shall be governed by the provisions related to the carriage of items.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 119 Article (337 ) 
1. Where a passenger dies or falls ill in the course of performance of the carriage contract, 
the carrier shall take such measures as deemed necessary to safekeep its luggage until they 
are delivered to the persons concerned.  
2. Where any of the persons concerned is present at th e place where death or illness occurs, 
he may intervene to monitor the measures adopted by the carrier to safekeep the luggage, 
and request the carrier to deliver to him a declaration that the passenger's luggage is in his 
custody.  
  
Article (338 ) 
Heirs an d dependents of a passenger may, in execution of a maintenance obligation, institute 
an action for liability arising from the carriage contract in case of the passenger's death, 
regardless of whether the death occurred directly after the incident or after the lapse of a 
period of time.  
  
Article (339 ) 
The carrier's liability for a passenger's death or bodily injury shall be limited to the blood 
money amount for manslaughter, pursuant to the statutes in force in the State. However, such 
amount may be agreed to be specified in an amount not less than such blood money amount.  
  
Article (340 ) 
1. The liability claim arising from the passenger's death or bodily injury shall not be heard 
after (3) three years following the day of death, injury or the date when the reason for the 
same becomes known.  
2. Any other action arising from a passenger carriage contract shall not be heard following  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 120 the lapse of one year from the date scheduled for arrival, and where no date is scheduled, 
the same shall not be heard from the date us ually required by an ordinary carrier for the 
carriage under the same circumstances.  
3. A person who, by himself or through his subordinates, commits fraud or serious error, 
shall not invoke the inadmissibility of the case set forth in this Article.  
  
Chapter Four  
Commission  Agency  for Carriage  
Article (341 ) 
1. A commission agency for carriage is a contract whereby the agent undertakes to enter into 
a carriage contract in his own name and for the benefit of his principal and to carry out, 
where necessary, such operations as related to the carriage, in consideration of a 
commission to be received from the principal. A commission agent for carriage shall, with regard to the consignor, have the same liability of the carrier.  
2. Where the commission agent undertakes carriage by his own means, he shall be governed 
by the provisions of the carriage contract, unless otherwise agreed upon.  
  
Article (342 ) 
Notwithstanding the provisions set forth in this Chapter, the provisions of commission agency shall apply to the commiss ion agency for carriage.  
  
Article (343 ) 
The principal may, at any time, cancel the order for carriage before the commission agent 
enters into the carriage contract. In such case, the principal shall refund to the commission 
agent the expenses incurred by him and shall compensate him for any work performed.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 121   
Article (344 ) 
1. The commission agent for carriage shall implement his principal's instructions, 
particularly those instructions related to the date of carriage, the selection of the carrier 
and the carriage means and the route to be followed.  
2. The commission agent may not charge his principal any fare/freight exceeding the one agreed upon with the carrier, and any benefits obtained from the carrier by the 
commission agent shall extend to the principal, unless otherwise agreed upon in the 
commission contract or as dictated by the customary practices.  
  
Article (345 ) 
The commission agent for carriage shall be liable for the safety of passengers or the items 
carried, and any agreement to the contrary shall be null and void.  
  
Article (346 ) 
1. The commission agent shall be held accountable for the destruction of the item carried, in 
full or in part, any damage suffered thereby or the delayed delivery of such goods. The 
commission agent may not deny such liabilit y unless he proves a force majeure event, an 
inherent defect of the goods or a fault of the principal or the consignee.  
2. In case of passenger carriage, the commission agent shall be liable for the delayed arrival 
and for such bodily or non- bodily injuries as are suffered by the passenger in the course 
of the carriage contract. The commission agent may not deny his liability, except by proving a force majeure event or a fault committed by the passenger. The commission agent's liability for passenger's death o r bodily injury shall be limited to the blood money 
amount for manslaughter, pursuant to the statutes in force in the State. However, such  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 122 amount may be agreed to be specified in an amount in an amount less than such blood 
money amount.  
3. In all cases, the c ommission agent may have recourse against the carrier where such 
recourse is well- grounded.  
  
Article (347 ) 
1. Any condition relieving the commission agent for carriage, in whole or in part, from 
liability for bodily injuries suffered by the passenger shall be null and void.  
2. Any condition which imposes on the passenger, in any manner whatsoever, the payment 
of all or any of the insurance costs against the liability of the commission agent shall be 
deemed as an act of relief from the liability.  
  
Article (348 ) 
1. The commission agent for carriage may stipulate that it be relieved, wholly or partially, from the liability arising from the destruction of, damage to, or delayed delivery of the 
goods carried, as well as from the liability arising from the delayed arriv al of the passenger 
or bodily injuries sustained by him during carriage.  
2. The condition of relief from liability shall be executed in writing, otherwise, it shall be null and void. Where the commission agency contract is executed on printed forms, such 
condition shall be clear and explicitly stipulated, otherwise, the court may consider it null 
and void.  
3. The commission agent for carriage may not invoke the condition of total or partial relief from liability where fraud or gross fault committed by him or by his subordinates or by the 
carrier or its subordinates is established.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 123 Article (349 ) 
1. The principal and passenger shall each have direct recourse against the carrier to claim the 
rights arising from the carriage contract. The carrier shall also have direc t recourse against 
each of the principal and passenger to claim such rights. In all cases, the commission agent 
shall be involved in the relevant case.  
2. The passenger, in respect of the carriage contracts of persons, and the consignee, in respect of 
the car riage contract of items, shall each be entitled to direct recourse against the principal, 
the carrier and commission agent for carriage for the rights arising from the carriage contract.  
  
Article (350 ) 
Where the commission agent pays the fare/freight to t he carrier, he shall subrogate the latter 
in respect of its rights.  
  
Article (351 ) 
The original commission agent shall be liable for the commission agent in respect of the 
carriage assigned by the former, unless the consignor has appointed the commission agent 
under the agreement concluded with the original principal.  
  
Article (352 ) 
The provisions of Articles (319), (320) and (340) above shall apply to the inadmissibility of the cases arising from commission agency contract for carriage.  
  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 124 Chapter F ive 
Provisions  Pertaining  to Air Carriage  
Article (353 ) 
1. Air carriage mentioned herein shall mean the carriage of persons, luggage and goods by 
airplanes in consideration of a fee.  
2. Luggage referred to in Clause (1) above shall mean items which the passenger is  allowed 
to carry with him aboard the airplane or which are delivered to the carrier for safekeeping during the flight.  
  
Article (354 ) 
Without prejudice to the international conventions to which the State is a party, the provisions of this Part shall apply to air carriage, subject to the specific provisions stipulated in the 
following Articles.  
  
Article (355 ) 
An air carrier shall be held liable for such damage sustained as a result of a passenger's death, wounding or bodily injury occurring during air  carriage or during any of the operations of the 
passenger's boarding or disembarkation of the airplane.  
  
Article (356 ) 
1. An air carrier shall be held liable for such damage sustained due to the destruction, loss or damaging of the registered luggage and go ods if the incident which caused the damage 
occurred during the air carriage.  
2. Air carriage shall include the period during which the luggage and goods are in the custody  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 125 of the carrier during the flight or during the presence of the airplane at an airport or in any 
place where the airplane has landed.  
3. Air carriage shall not cover the period when the luggage or goods are being carried by land, 
sea or river outside the airport. However, where such carriage is necessary to ship the 
luggage or goods or deliver them or to transfer them from one airplane to another, in 
pursuance of an air carriage contract, it shall be presumed that the damage resulted from 
an incident which occurred during the air carriage period until the contrary is proved.  
  
Article (357 ) 
An a ir carrier shall be held liable for damage caused by the delayed arrival of passengers or 
the registered luggage or goods.  
  
Article (358 ) 
An air carrier shall not be liable for small personal items which are retained in the custody of 
passengers during th e flights. The air carrier may not be held accountable for the same unless 
the passenger proves that the carrier or its subordinates have failed to take the necessary 
measures to prevent the occurrence of the damage.  
  
Article (359 ) 
1. In case of passenger carriage, the compensation ordered by the court against the carrier where the passenger dies or is injured shall not be less than the amount of the prescribed 
blood money pursuant to the statutes in force in the State, and a greater amount may be 
agreed up on. 
2. In case of carriage of luggage and goods, the compensation amount shall not exceed (AED 
500) five hundred dirhams per kilogram, unless it agreed to exceed this sum.  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 126 Nevertheless, where the consignor, upon delivering the luggage or goods, submits a 
spec ific statement indicating that he attaches particular importance to the delivery of the 
same in safe condition at the place of arrival, due to its value, and if he pays such additional 
freight as required by the carrier for the same, the carrier shall pay the compensation 
according to the value indicated by the consignor, save where the carrier proves that such 
value exceeds the real value of the luggage and goods.  
3. Where a parcel is lost or damaged or its delivery is delayed and the same has an effect on 
the value of the other parcels covered by the same carriage application form, the total 
weight of such parcels shall be taken into consideration upon establishing the liability limit.  
4. As for personal or small items, which remain in the custody of passengers during the flight, 
the compensation awarded in favor of each passenger for the destruction of or damage to 
such items may not exceed the sum of (AED 5,000) five thousand dirhams.  
5. The air carrier may not invoke the limitation of liability stipulated in this  Article where it is 
proved that the damage is caused by an act or omission of the carrier or its subordinates, 
whether with intent to cause damage or due to imprudence coupled with awareness that 
damage might arise therefrom. Where the act or omission is committed by the 
subordinates, it shall also be established that it was committed in the course of 
performance of their duties.  
  
Article (360 ) 
An air carrier shall be held liable within the limits set forth in article (359) above, regardless 
the capacity of the litigants in the civil liability action.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 127 Article (361 ) 
1. Where an action for compensation is brought against any of the carrier's subordinates, he 
may invoke the limitation of liability set forth in article (359) where it is proved that the 
act which has caused the damage was committed by him during the performance of his 
duties.  
2. However, no subordinate of the carrier may invoke the limitation of liability where it is 
proved that the damage is caused by an act or omission by him, whether with intent  to 
cause damage or with imprudence coupled with awareness that damage is likely to arise 
out.  
  
Article (362 ) 
1. The airway bill shall contain a statement that the carriage is taking place in accordance 
with the liability limitation provisions set out in article (359) above, otherwise, the carrier 
or its subordinates may not invoke such provisions.  
2. Any condition relieving the air carrier from liability or limiting such liability in amount less than that specified in article (359) above shall be null and vo id, except where the item 
carried has perished or has sustained damage due to its nature or due to an inherent 
defect.  
  
Article (363 ) 
The consignee's receipt of the luggage or goods at the place of arrival without having any 
reservation shall constitute a presumption that he has received them in a good condition and 
in conformity with the conditions of the airway bill, unless otherwise proved.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 128 Article (364 ) 
1. Where the luggage or goods arrive damaged, the consignee shall serve a notice to the 
carrier imme diately upon detection of the damage, not later than (7) seven business days 
with regard to luggage, and (14) fourteen business days with regard to goods from the 
date of their receipt. In case of delayed arrival of luggage or goods, the notice shall be 
served within (21) twenty -one business days at the most from the day on which the 
luggage or goods are placed at the disposal of the consignee.  
2. The notice may be served in the form of an objection to be recorded in the airway bill at 
the time of receiving th e luggage or goods.  
3. The action for liability against the carrier shall be inadmissible where the notice is not 
served within the time limits specified in this Article, unless the plaintiff proves that the 
carrier or its subordinates have committed an act of fraud or deception in order to miss 
such time limits or to conceal the damage sustained by the luggage or goods.  
  
Article (365 ) 
1. Where the carriage is made free of charge, the air carrier shall assume no liability, unless 
it is proved that the carrier o r its subordinates have committed a fault, in which case, the 
carrier shall be held accountable within the limits stipulated in article (359) above.  
2. Carriage shall be deemed free of charge where it is performed without a fare and the 
carrier is not a profe ssional carrier. However, where the carrier is a professional carrier, 
the carriage shall not be considered free of charge.  
  
Article (366 ) 
An aircraft pilot may impose compulsory measures on all persons on board, and may decide to remove any person or ite ms whose presence on board the aircraft might constitute a threat  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 129 to its safety or prejudice to the order in the aircraft.  
  
Article (367 ) 
An air carrier shall be relieved from liability if it proves that the entire damage is caused by the 
fault of the injured person. The carrier's liability may be reduced by the court where it is 
proved that the fault of the injured person has contributed to causing the damage.  
  
Article (368 ) 
The plaintiff shall have an option to institute his case before one of the following courts:  
1. The court within its jurisdiction the carrier's domicile is located;  
2. The court within its jurisdiction the head office of the carrier's business is located;  
3. The court within its jurisdiction the carrier has an establishment or legal entit y which has 
entered into the carriage contract on its behalf; or  
4. The court of the place of destination.  
Any stipulation bringing an amendment to the rules of jurisdiction, referred to 
hereinabove, shall be null and void, unless it is stipulated before occurrence of the damage in question.  
  
Article (369 ) 
In case of consecutive carriage performed by several successive carriers, each carrier shall be deemed a party to the carriage contract with regard to the period performed by it. However, 
the carrier having  entered into the consecutive carriage contract shall assume the liability for 
all the period agreed in the contract, even if it is not personally performed by such carrier in 
whole or in part.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 130 Article (370 ) 
The right to bring an action for liability aga inst the air carrier or any of its subordinates shall 
not be heard after the lapse of two years following the day on which the airplane arrives or 
was supposed to have arrived, or following the day on which the carriage was stopped.  
  
Book T hree  
Banking  Transactions  
Part O ne 
Bank  Deposits , Transfers  and  Accounts  
Chapter O ne 
Bank  Deposits  
Article (371 ) 
1. A bank cash deposit is a contract whereby one person delivers a sum, by any means of payment, to the bank which undertakes to return it upon request or accor ding to the 
agreed conditions.  
2. A bank shall acquire the ownership of the money deposited, and shall be entitled to 
dispose of the money for the needs of its own business, with an obligation to refund the 
like to the depositor. Such refund shall take place in the same currency of deposit.  
  
Article (372 ) 
1. Save where otherwise agreed upon, the money deposit shall be refunded immediately 
upon request. The depositor may at any time dispose of the balance or any part thereof.  
2. The said right may be conditional upo n a prior notice or the expiry of a specific time limit.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 131 Article (373 ) 
Save where the deposit is intended for investment, a cash deposit shall be considered a debt 
and an offset may be conducted between it and a debt owed by the depositor to the bank, and 
any agreement to the contrary shall be null and void.  
  
Article (374 ) 
Where the bank issues a saving deposit book, it shall be issued in the name of the person in 
whose favor the book is issued, and deposits and withdrawals shall be entered therein. Th e 
particulars entered in such book, which are signed by the bank's employee, shall constitute 
evidence for proving the said particulars between the bank and the person in whose favor the 
book is issued, and any agreement to the contrary shall be null and v oid.  
  
Article (375 ) 
Unless otherwise agreed upon, deposits and withdrawals shall be conducted in any branch of 
the bank, or according to the methods and means approved by the bank with respect to 
opening accounts via modern means of technology.  
  
Article (376 ) 
Where the depositor has several accounts in one bank or in the same branch of a bank, each account shall be deemed separate from the other(s), unless otherwise agreed.  
  
Article (377 ) 
Subject to the provisions of article (391) hereof, a deposit contr act shall not entitle the 
depositor to withdraw amounts from the bank exceeding the sums deposited therein. Where the bank carries out transactions which cause the depositor's balance to be in debit, the bank  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 132 shall forthwith inform the depositor of the sam e in order to adjust his balance.  
  
Article (378 ) 
The bank shall send to the customer a statement of account once every month, unless 
otherwise agreed upon.  
  
Article (379 ) 
The bank may open a joint account, including a deposit account or any other account, 
between two or more persons with equal shares among them, unless otherwise agreed and 
recorded with the bank, subject to the following provisions:  
1. A joint account shall be opened by all its owners or by one person holding a power of 
attorney from the owners of the joint account duly authenticated by an official competent 
authority. Withdrawals from such account shall be conducted according to the agreement of the account owners  
2. Where the balance of a joint account's co -owner is seized, the said seizure shall apply to 
the Distrainee's share of the account balance as of the day on which the bank is served with the seizure notice. In such a case, the bank shall suspend withdrawals f rom the joint 
account as equivalent to the share seized. The co -owners of the joint account or their 
representatives shall be informed of the seizure within a period not exceeding (5) five 
business days from the day of imposing the seizure.  
3. When the bank c arries out an offset between various accounts of a co -owner of a joint 
account, it may include such joint account in the offset only with the written consent of 
the other co- owners.  
4. Upon the death or lack of capacity of a joint account's co -owner, the othe r co-owners shall 
notify the bank of the same not later than (10) ten days from the date of death or lack of  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 133 capacity. The bank shall, from the date of being so notified, suspend the withdrawal from 
the joint account within the limits of such person's shar e of the account balance on the 
date of his death or lack of capacity. No withdrawal may be made from the shares of the 
deceased or the person lacking the capacity until a successor is appointed.  
  
Chapter T wo 
Bank  Transfer  
Article (380 ) 
1. A bank transfer is  a transaction whereby a bank records a specified sum in the debit side 
from the account of the person who has ordered the transfer, based on a written order 
from the ordering customer, and such amount is recorded in the credit side of another 
account.  
2. The  following may be achieved through the foregoing transaction:  
3. The transfer of a specified sum from the account of one person to the account of another 
person, each of whom having an account with the same bank or in two different banks; or  
4. The transfer of a specified sum from one account to another both of which are opened in 
the name of the person who has ordered the transfer in the same bank or in two different 
banks.  
5. An agreement between the bank and the customer ordering the transfer shall provide for the conditions of the order issue; however, the order of transfer may not be made to the 
bearer.  
  
Article (381 ) 
Where the bank transfer is conducted between two branches of the same bank or between two different banks, every objection by third parties to th is transfer shall be addressed to the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 134 branch or the bank where the beneficiary's account is opened.  
 
Article (382 ) 
The transfer order may be conducted in respect of sums which are actually entered in the 
account of the person ordering the transfer, or in respect of sums which may be entered in 
such account within a specified period as is agreed with the bank.  
  
Article (383 ) 
It may be agreed that the beneficiary may present the transfer order in person to the bank 
where the account of the person ordering t he transfer is opened, rather than informing the 
bank of the same by the ordering person.  
  
Article (384 ) 
1. The beneficiary shall own the bank transfer value as of the time of being entered in the debit side of the account of the person ordering the transfer ; and the latter may 
countermand the transfer order until the foregoing entry is made.  
2. Where it is agreed that the beneficiary shall present the transfer order to the bank in 
person, the person ordering the transfer may not countermand the transfer, subjec t to the 
provisions of article (389) hereof.  
  
Article (385 ) 
The debt in settlement of which the transfer is made shall remain outstanding with its securities and supplements until the value has been actually entered in the credit side of the 
beneficiary's  account.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 135 Article (386 ) 
It may be agreed to postpone the execution of specified transfer orders, whether they are sent 
directly by the person ordering the transfer or presented by the beneficiary, until the end of 
the day in order to have them executed w ith other orders of the same kind and presented to 
the bank on the same day.  
  
Article (387 ) 
1. Where the transfer order is addressed directly by the person making the order to the bank, 
the latter may, where the balance of such person is less than the value indicated in the 
transfer order, refuse to execute the order; provided that it notifies, without delay, such 
refusal to the person ordering the transfer.  
2. Where the transfer order is presented by the beneficiary and its value is higher than the ordering per son's balance, the bank shall credit the beneficiary's account with the partial 
balance, unless the beneficiary refuses the same. The bank shall further annotate on the transfer order the crediting of the partial balance or the beneficiary's refusal of the  transfer.  
3. Where several beneficiaries present themselves to the bank at the same time and the value 
of the transfer orders held by them exceed the balance of the person ordering the transfer, 
they shall be entitled to require the distribution of the insuf ficient balance between them, 
each according to his share.  
4. Where the bank refuses to execute the transfer order or where the beneficiary refuses to 
accept the transfer of the partial balance, pursuant to Clauses (1) and (2) above, the person 
ordering the transfer shall have the right to dispose of such balance.  
5. Where the bank fails to execute the transfer order on the first business day following the day on which it is presented, the order shall, within the limits of the non -executed part, be 
considered nu ll and void and must be returned to the person who presented it against a  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 136 receipt. Where an agreement is reached for a longer period, the transfer order which has 
not been executed shall be added to the orders submitted on the following days.  
  
Article (388) 
In case of death of the person ordering the transfer, the bank shall, as of the date on which the 
death comes to the knowledge of the bank, cease execution of the transfer orders issued by 
him. Where the beneficiary dies, the bank shall carry on the exe cution of the transfer orders.  
  
Article (389 ) 
1. Where the beneficiary is declared bankrupt, the person making the order may suspend 
the execution of the transfer order, even if the beneficiary has received it in person.  
2. The declaration of bankruptcy by the person making the order of transfer shall not prevent the execution of the transfer orders which had been presented to the bank prior to the 
issue of the bankruptcy declaration judgment, save where the court decrees otherwise.  
3. The provisions of the preceding two Paragraphs shall apply in so far as they do not 
contradict the Bankruptcy Law.  
  
Part T wo 
Current  Account  
Article (390 ) 
A current account is a contract between two persons under which the rights and debts arising from their mutual relationship are converted into entries to be made in the account for which 
clearance shall be conducted, so that the final balance, upon the closure of the account, shall 
alone constitute a payable debt.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 137 Article (391 ) 
1. A bank may open a current account for its cust omer where the transactions carried out by 
said bank are coupled with opening a credit or a credit facility in his favor.  
2. It may be agreed that the account shall not be overdrawn from the customer's side with a 
continuously credit balance. It may also be agreed that said account shall be overdrawn 
on both sides, i.e. it could have a debit or credit balance with regard to both parties.  
  
Article (392 ) 
In order for the payments to be entered in a current account, they must:  
1. Be in cash or fungible items of one  kind, so that clearance may be conducted between 
them;  
2. Have arisen from debts that are actually existing and are of a specific amount; and  
3. Have delivered to the payee on basis of ownership.  
  
Article (393 ) 
The two parties may keep several current accounts , as long as each account is restricted to one 
specific kind of transactions or currencies.  
  
Article (394 ) 
A contract of current account shall result in the following:  
1. The ownership of cash and funds delivered and entered in the current account shall be 
transferred to the party who received them.  
2. The entry of a commercial paper in the current account is deemed to be valid and its value shall not be taken into consideration where it is not paid on the date of maturity, in which 
case, it may be returned to its owner and a counter entry is made in such manner as  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 138 specified in article (407) hereof.  
3. The totality of the items of the current account shall be indivisible before the closure of 
the account and extraction of the final balance.  
4. Clearance may not be aff ected between one item in a current account and another item in 
the same account.  
5. Items entered into the current account shall not terminate the rights of either party regarding such contracts and transactions arising from such items.  
6. Save where otherwise agreed, each party to a current account may at any time dispose of his credit balance.  
  
Article (395 ) 
1. All debts arising from business relations, as are conducted between both parties to the 
current account, shall by the operation of the law be entered in said account, save where 
such debts are secured by legal or contractual securities.  
2. Debts secured by contractual securities, whether they have been established by the debtor or a third party, may be entered in the current account, where all the parties con cerned 
have expressly agreed on such entry.  
  
Article (396 ) 
1. Where it has been agreed to enter a debt secured by a contractual security in the current account, such security shall pass to guarantee the balance of the account on closure by the 
amount of the debt, without regard to any changes which may occur to the account during 
its course of operation, save where otherwise agreed upon.  
2. Where the Law provides for certain measures for concluding the security or invoking it 
against third parties, such security  shall not pass to guarantee the current account balance,  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 139 and it may be invoked only from the date on which such measures are made.  
  
Article (397 ) 
Where the debts due to either party are entered in the current account, they shall lose their 
special characteristics and independent existence and shall neither, thereafter, be susceptible 
to settlement separately, nor to clearance, suing or lapse by prescription.  
  
Article (398 ) 
1. Where the entries of a current account contain cash debts evaluated in vario us currencies 
or non -fungible items, both parties may agree to have them entered in the current 
account; provided that they are entered under separate sections with due regard to the 
similarity of the payments represented thereby and that both parties allo w the account to 
maintain its unity in spite of its several sections.  
2. The balances of said sections shall be transferable, so that it would be possible, within the 
time limit specified by both parties or at most when closing the account, to conduct an 
offs et between the various sections to extract a single balance.  
  
Article (399 ) 
1. Payments made by the customer into the current account shall bear no interests, unless 
otherwise agreed upon. The interest shall be calculated at the rate agreed upon. Where 
the r ate of interest has not been fixed in the agreement, it shall be calculated on basis of 
such rate of interest prevailing in the market at the time of transaction up to (9%).  
2. Interest shall apply to the debit balance as of the date of closure of the account , save where 
otherwise agreed upon.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 140 Article (400 ) 
1. Where a time limit has been fixed for the closure of the account, it shall be closed on the 
expiry of said limit; however, it may be closed before the expiry of such time limit by 
mutual agreement of both  parties.  
2. Where a time limit is not set for the current account, it may be closed at any time at the wish of either party, in compliance with the time limits prescribed for notices as agreed 
upon or as customary.  
3. In all cases, the account shall be closed u pon the death of either party or lack of capacity 
or where either party is declared bankrupt, the legal person expires, the bank is removed 
from the list of operating banks or the bank ceases to carry out its business.  
  
Article (401 ) 
A current account shall between a bank and its customer shall be deemed closed at the end of the bank's financial year. Such closure shall not be considered as a closure of the account; 
however, it shall remain open with its balance being carried forward to the same current 
account. The said account shall resume its operation on the next business day.  
  
Article (402 ) 
Where the current account is closed, the balance shall be deemed a payable debt, unless both 
parties agree on otherwise, or where some of the transactions required  to be entered into the 
account are still current and the entry would adjust the balance amount. In in which case, the balance debt shall be payable on the day following the date of the last entry required for such 
transactions.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 141 Article (403 ) 
The general rules prescribed for the limitation of actions shall apply to the debit balance and 
its interests.  
  
Article (404 ) 
Where the sum of a debt entered into the account is released or reduced due to a reason after 
being entered in the account, such entr y shall be removed or reduced, as the case may be, and 
the account shall be adjusted accordingly.  
  
Article (405 ) 
A creditor of either party to the current account may garnish the credit balance of the judgment debtor at the time of the garnishment.  
  
Article (406 ) 
1. Where either party to the current account is declared bankrupt, no garnishment made 
over its properties after the date fixed by the court for the suspension of payment may be 
invoked against the Body of Creditors, in order to secure the potential balance debt to the 
extent of the debit balance amount at the time when the garnishment is established.  
2. Nevertheless, the garnishment may be invoked against the Body of Creditors as to the 
difference, if any, between the debit balance amount at the time w hen the garnishment is 
decided and the balance amount at the time of closing the account, save where it is 
established that the judgment creditor was aware, when the garnishment was decided, 
that the debtor had stopped payment.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 142 Article (407 ) 
1. Where the proceeds of deducting a commercial paper is entered in the current account 
but the value thereof is not paid on the date of maturity, the person who deducted the 
instrument may remove the entry of its value into the current account by a counter entry, 
even  if the person who presented it for deduction has been declared bankrupt.  
2. A counter entry means an entry of a sum equal to the value of the commercial paper, plus 
the expenses, in the debit side of the current account.  
3. A counter entry may be made only with regard to such commercial papers as have not 
been paid on their maturity dates. Any agreement to the contrary shall be null and void.  
  
Article (408 ) 
In case of denial and lack of lawful excuse, a legal action for the rectification of the current 
account shall barred with regard to entries made one year after the date of receipt of the 
statement of account, even if such legal action is based on an error, omission or repetition of such entries, save where during such period one party has notified the other that he insists on 
the rectification of the account, or where the customer proves, regarding a current account 
opened with a bank, that throughout the said period he did not receive from the bank any 
statement of account. In both cases, the action shall no t be heard after the lapse of (5) five 
years following the account closure date.  
  
  
 
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 143 Part T hree  
Bank  Credits  
Chapter O ne 
Bank  Loan  
Article (409 ) 
1. A bank loan is a contract whereby a bank delivers to the borrower a sum as a loan or enters 
such sum in the credit side in his account with the bank, as per the agreed conditions and 
time limits.  
2. Banks shall obtain adequate securities or collaterals against loans granted by them.  
3. A borrower shall repay the loan and its interest to the bank within such time limit s and 
according to such conditions as agreed.  
  
Article (410 ) 
A bank loan shall be considered a commercial activity irrespective of the capacity of the 
borrower or the purpose for which the loan is allocated.  
  
Chapter T wo 
Bank  Guarantee  
Article (411 ) 
1. A bank guarantee is an undertaking issued by a bank to repay the customer's debt to a 
third party, in accordance with the conditions agreed and included in the guarantee. The guarantee may be for a definite or indefinite term.  
2. A bank guarantee shall constitu te a joint liability.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 144 Article (412 ) 
A bank guarantee may be issued under different forms, including:  
1. A bank signs a commercial paper as a reserve guarantor, or gives such reserve guarantee 
by a separate instrument to allow that several commercial papers are guaranteed together 
at one time;  
2. An independent contract of guarantee is entered into; or  
3. A letter of guarantee is addressed by the bank to the customer's creditor whereby the bank 
guarantees its customer's fulfillment of his obligations.  
  
Article (413 ) 
A bank guarantee shall be considered a commercial activity, regardless of the capacity of the 
guaranteed person or the purpose for which it has been allocated.  
  
Article (414 ) 
A letter of guarantee is an undertaking issued by the guarantor bank, at th e request of one of 
its customers (the person making the order), to pay, unconditionally and without restrictions, a certain or determinable sum to another person (the beneficiary), unless the letter of 
guarantee is conditional where payment is requested w ithin the time limit set out in the letter. 
The letter of guarantee shall state the object for which it has been issued.  
  
Article (415 ) 
1. The bank may require that security or guarantee be furnished against the issuance of the letter of guarantee.  
2. The security or guarantee may be in cash or in the form of commercial papers, securities, goods or assignment of the right towards the beneficiary by the ordering person to the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 145 bank.  
  
Article (416 ) 
A beneficiary may only assign his right that had arisen f rom the letter of guarantee to a third 
party with the approval of the bank.  
  
Article (417 ) 
1. A bank may not refuse payment to the beneficiary for a reason attributed to the bank's 
relationship with the person making the order or the relationship of the latt er with the 
beneficiary.  
2. Notwithstanding the provisions of Clause (1) above, the bank may refrain from payment to the beneficiary where an enforceable order or court judgment is rendered to impose 
seizure on the guarantee amount with the bank. In such case , in order for such order or 
judgment to be rendered, the person making the order shall rely for his claim on serious and confirmed grounds.  
  
Article (418 ) 
1. The bank shall be discharged vis -a-vis the beneficiary if within the validity period of the 
letter of guarantee no request for payment is received from the beneficiary, unless it had 
been expressly agreed to renew said term prior to its expiry.  
2. The bank shall return to the person making the order the securities or guarantees provided by the same against  the letter of guarantee where its effective term expires without the 
payment of the guarantee sum, unless otherwise agreed.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 146 Article (419 ) 
Where the bank pays to the beneficiary the sum agreed in the letter of guarantee, it shall 
subrogate him for recou rse against the person making the order for the sum it had paid.  
  
Chapter T hree  
Opening  a Letter  of Credit  
Article (420 ) 
1. Opening a letter of credit is a contract whereby the bank places at the disposal of the 
customer a certain sum, which the customer may  withdraw as a single payment or 
multiple payments.  
2. A letter of credit may be opened either for a definite or indefinite term.  
  
Article (421 ) 
A contract for opening a credit is not considered a loan, and the customer shall not be bound 
to use the letter of credit opened in his favor.  
  
Article (422 ) 
1. Where a letter of credit is opened for an indefinite term, the bank may at any time terminate it, based upon a notice to be served to the beneficiary at least thirty days before the date set for the terminatio n. Any agreement which entitles the bank to terminate an 
indefinite term letter of credit without a prior notice or with a shorter -period notice shall 
be null and void.  
2. In all cases, the letter of credit opened for an indefinite term shall be deemed termin ated 
if the beneficiary does not use it after the lapse of six months from the date on which the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 147 beneficiary is notified of such opening, save where otherwise agreed.  
  
Article (423 ) 
1. The bank may not terminate the letter of credit before the expiry of the term specified 
therefor, except where the beneficiary dies, becomes legally incompetent or suspends 
payment, even though a judgment declaring his bankruptcy is not issued or he commits a 
gross fault in using the letter of credit opened in his favor.  
2. Where the customer in whose favor the letter of credit is opened is a company, such credit 
shall expire also upon its nullification or expiration.  
  
Article (424 ) 
Where a substantial decrease occurs to the real or personal guarantees presented by the 
customer, the bank may request an additional guarantee or reduce the letter of credit sum in 
proportion to such decrease.  
  
Article (425 ) 
A credit may be transferred only with the approval of the bank which opened it.  
  
Article (426 ) 
A contract for opening a credit shall be considered a commercial activity, regardless of the capacity of the customer or the purpose for which the letter of credit is allocated.  
  
Article (427 ) 
The contract for opening a credit shall specify the maximum limit of the letter of credit sum 
and the method of using the letter of credit.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 148   
Article (428 ) 
Where a credit is terminated pursuant to the provisions of this Chapter, the bank shall not be 
required to pay payment orders or cheques drawn on the letter of credit, as long as they are 
presen ted to the bank after the letter of credit is terminated.  
  
Chapter F our 
Documentary  Credit  
Article (429 ) 
1. A documentary credit is a contract whereby a bank opens a credit, at the request of its 
customer (the person ordering the opening of the letter of cre dit), within the limits of a 
specified sum and for a definite term in favor of another person (the beneficiary), secured by documents representing goods shipped or intended to be shipped.  
2. A documentary credit contract shall be deemed separate from the cont ract which caused 
the opening of the letter of credit, and the bank shall remain separate from such contract.  
  
Article (430 ) 
Every documentary credit shall contain a time limit date for its validity and for presenting the 
documents for payment, acceptance  or deduction. Where the date set for the expiry of the 
validity of the letter of credit is on a bank holiday, its validity shall be extended to the next 
following business day. The validity of the letter of credit shall not extend beyond any other 
period,  other than bank holidays, even when the expiry of the validity coincides with the date 
of disruption of the bank's business due to force majeure events, unless there is an express 
authorization to that effect from the person ordering the opening of the le tter of credit.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 149 Article (431 ) 
1. The documents regarding the opening of the documentary credit or its confirmation or 
notice thereof shall describe precisely the documents against which the operations of 
payment, acceptance or discount are executed.  
2. A bank which opens a letter of credit shall execute the conditions of payment, acceptance and discount as agreed in the documentary credit contract if the documents representing 
the goods conform to the particulars and conditions provided for in the documentary 
credit contract.  
  
Article (432 ) 
1. A documentary credit may be revocable or irrevocable.  
2. A documentary credit shall be irrevocable, unless it is expressly agreed to the contrary.  
3. A documentary credit may either be divisible, transferable, indivisible or non -transferable.  
  
Article (433 ) 
1. A revocable documentary credit shall not create any obligation on the bank towards the 
beneficiary. The bank may at any time amend or terminate it of its own accord or at the 
request of the person who ordered the letter of  credit to be opened.  
2. Where the bills of lading presented are in conformity with the particulars and conditions contained in the documentary credit contract and within its validity term and prior to its 
termination, the bank and the person ordering the ope ning of the letter of credit shall 
assume the joint liability vis -à-vis the beneficiary.  
  
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 150 Article (434 ) 
1. Where the documentary credit is irrevocable, the obligation of the bank shall be strict and 
direct to the beneficiary and to any bona fide holder of the instrument drawn, in 
pursuance of the contract which caused the documentary credit to be opened.  
2. An irrevocable documentary credit may neither be terminated nor amended save with the agreement of all parties concerned.  
  
Article (435 ) 
1. An irrevocable documentary credit may be confirmed by a bank other than the one that 
opened it. Such confirming bank shall in turn assume an absolute and direct obligation 
towards the beneficiary and any bona fide holder of the instrument drawn in execution of 
the documentary credit contract.  
2. A mere notice of the opening of an irrevocable documentary credit sent to the beneficiary 
through another bank, other than the one that opened the documentary credit, shall not 
be deemed to be a confirmation of the letter of credit b y such other bank.  
  
Article (436 ) 
1. The documents shall be presented to the bank before the expiry of the letter of credit term. 
If the documents are presented beyond such a term, the bank shall reject them, unless the 
person ordering the opening of credit requests that the same be approved, and the bank 
approves the same.  
2. The bank shall ascertain that the documents required are available and that their contents are in full conformity with the conditions of the letter of credit and that they fully conform 
with each other.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 151 Article (437 ) 
The bank is only obligated to examine the documents to ensure that, at first sight, are in 
conformity with the documents required in the letter of credit, but it is not obligated to check 
if the goods conform with the docum ents which represent them.  
  
Article (438 ) 
Where the bank accepts the documents, it shall immediately send them to the person ordering the opening of the letter of credit, and where the bank rejects the same, it shall forthwith serve 
a notice of rejection to the beneficiary, indicating the reasons for such rejection.  
  
Article (439 ) 
1. The beneficiary may not assign the letter of credit in whole or in part to another person or 
persons, save with an express authorization to that effect from the bank and provide d it is 
expressly stipulated in the letter of credit.  
2. The bank may not divide the performance of the letter of credit, except with the authorization of the person ordering the opening of the letter of credit.  
3. The assignment may be made only once, unless the contract for opening of the letter of credit stipulates otherwise.  
4. The assignment shall be made by endorsing the letter of credit if it is promissory or by receiving it if it is to bearer, but in case it is nominative, the procedures of the assignment 
shall apply.  
  
Article (440 ) 
1. The person ordering the opening of documentary credit shall be bound to repay to the 
bank the sum it has paid to the beneficiary, within the limits of the letter of credit opened,  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 152 as well as paying the bank the expenses paid in  this respect.  
2. As a guarantee of its entitlements, the bank shall have the right to withhold the documents 
it receives from the seller and the right of pledge on the goods represented in their 
documents.  
3. Where the person who ordered the opening of the letter of credit fails to pay to the bank the value of the bills of lading conforming with the conditions of the opening of the letter 
of credit, within one month from the date of being notified of the arrival of said bills, the 
bank may sell the goods by adopting the methods of execution on items commercially 
pledged.  
4. Where the goods are perished or damaged, the pledge right shall pass to the insurance sum.  
5. The bank and its customer may, after arrival of the documents of the letter of credit 
financed by said bank, agree that the customer debtor assigns the goods, subject of the 
documentary credit, or part thereof to the bank to repay the bank's debt in whole or in 
part. The bank shall thereafter entrust the customer with the receipt goods, keep them in 
trus t and sell them on behalf of the bank for its account, based on the terms and conditions 
to be agreed by both parties. In such case, the customer's responsibility shall be that of a commission agent, and the bank shall have all the rights of an agent over such goods or 
their price.  
  
 
 
 
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 153 Part F our 
Transactions  on Commercial Papers  
Chapter O ne 
Discount  
Article (441 ) 
1. A discount is a contract whereby a bank undertakes to pay in advance the value of a 
commercial paper to the beneficiary, in return for transferring the ownership of such 
commercial paper to the bank.  
2. The bank shall deduct from the sum paid to the beneficiary of the discount an interest on the commercial paper amount, plus a commission. It may be agreed to effect the discount 
against a lum p sum.  
  
Article (442 ) 
1. The interest shall be calculated on the basis of the time elapses from the date on which 
the commercial paper is presented for discount until its maturity date, unless otherwise 
agreed upon.  
2. A commission shall be estimated on basis of the value of the commercial paper.  
  
Article (443 ) 
1. The bank shall acquire the ownership of the discounted commercial paper and it may use all rights of the bearer and it may have recourse against the signatories of the commercial 
paper.  
2. The bank shall further have, vis -a-vis the beneficiary of the discount, an independent right 
to recover the sums it has placed at his disposal, without deducting such interest and  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 154 commission which were received by the bank.  
3. Without prejudice to the provisions related to the current account, the bank shall exercise 
such right within the limits of the unpaid commercial papers, regardless of the cause of 
non -payment of the discounted commercial papers.  
  
Article (444 ) 
1. Where the value of the commercial paper is  not paid or the customer becomes bankrupt, 
the bank may reserve for itself the right to make a counter -entry to the value of the 
commercial paper and the expenses in the debit side of its customer's account, who in his 
turn shall endorse the commercial papers to the bank.  
2. Where the customer has no current account with the bank, he shall refund the commercial 
paper's value plus the expenses to the bank.  
  
Chapter T wo 
Acceptance  Credit  
Article (445 ) 
Acceptance credit is a contract whereby a bank plays the role of the drawee. It accepts in this 
capacity a commercial paper drawn on it by its customer or another party who deals with such 
customer, and the bank undertakes to pay the value of such commercial paper on the maturity 
date.  
  
Article (446 ) 
Where the bank pays the value of the commercial paper accepted thereby, it shall enter its 
value and the expenses in the debit side of the customer's account, and shall have recourse 
against the customer for the sums paid by virtue of the letter of credit opened in favor of the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 155 customer and used as a consideration for the payment of the commercial paper which it had 
undertaken to accept.  
  
Chapter T hree  
Collection  of Commercial Papers 
Article (447 ) 
The bearer of a commercial paper may endorse it to the bank under a p rocuration 
endorsement. By virtue of such endorsement, the bank shall become an attorney -in-fact with 
regard to the collection of the commercial paper's value for the benefit of the endorser.  
  
Article (448 ) 
Upon maturity of the commercial paper, the bank shall claim payment from the drawee or the 
executor. Where the payment is made, the bank shall enter the value of the commercial paper in the credit side of the customer's account, and if payment is not made, the bank shall make a protest or establish the non -payment, and in both cases the expenses shall be charged to the 
customer's account.  
  
Article (449 ) 
1. The bank shall be liable for fault or omission in the execution of its power of attorney.  
2. The bank may require its relief from liability for delay in dr awing up the protest. Such 
requirement shall be effective between the customer and the bank, unless an act of fraud or gross fault is attributed to the bank; however, such requirement shall not apply to other 
endorsers.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 156 Article (450 ) 
The power of attorn ey arising from the procuration endorsement shall not lapse upon the 
endorser's death or legal incapacitation.  
  
Part F ive 
Transactions  on Securities  
Chapter O ne 
Lending  Against  Securities  
Article (451 ) 
1. Lending against securities is a loan secured by collateral.  
2. Where securities are nominative instruments, the pledge thereof shall be made in writing 
by virtue of an assignment stating that they are given as a guarantee, which shall be annotated on the instrument itself and entered into the records of th e issuer. However, 
where the securities are bearer instruments, they shall be treated as tangible movables and the pledge thereof may be proved by all means of evidence.  
  
Article (452 ) 
1. The ownership of pledged securities shall be transferred from the pled ger to the pledgee 
bank.  
2. The bank shall may withhold such instruments.  
  
Article (453 ) 
The bank shall maintain the pledged securities by collecting their profits and receiving their value upon amortization and deducting such sums from the principal debt.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 157   
Article (454 ) 
Where the bank fails to receive its dues on the maturity date thereof, it may apply to the 
competent court to authorize it to sell the pledged instruments by public auction or at their 
price in the capital market, in order to collect its rig ht from the sale price towards creditors, 
and any agreement to the contrary shall be null and void.  
  
Article (455 ) 
Where the instruments are presented by a person other than the debtor, the owner thereof shall not be bound to pay the debt guaranteed by th e pledge, except in his capacity as a 
guarantor in rem.  
  
Article (456 ) 
A third party appointed by the two contracting parties to acquire the pledged instruments shall be deemed as having waived his right to foreclose the pledge for any reason prior to suc h 
pledge, unless he had reserved such right when he accepted to possess the instrument 
pledged for the account of the pledgee.  
  
Article (457 ) 
Where the full value of an instrument is not paid at the time of being presented as a pledge, 
the debtor shall, upon maturity of the unpaid part, pay it at least two days prior to its maturity date, otherwise, the pledgee may appeal the court to sell the instrument, pursuant to the 
provisions of article (454) above. The unpaid part shall be paid from the proceeds of the sale 
and the balance shall be retained as a collateral in lieu of the pledge.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 158 Article (458 ) 
The lien of the pledgee shall remain in the same ranking as between the contracting parties 
and vis -a-vis third parties over the profits of the pledged instrument, its interest, the 
commercial papers replacing it and its value if paid before its maturity date.  
  
Chapter T wo 
Deposit  of Securities  
Article (459 ) 
The deposit of securities with a bank is a contract whereby the customer delivers to the bank the securities which have been agreed to be deposited and the bank gives the customer a 
receipt upon receiving such securities. Such receipt shall contain the contract conditions and the numbers of such securities; however, the said receipt shall neither repre sent the securities 
deposited nor replace them, but it serves as a mere instrument to prove the contract.  
  
Article (460 ) 
1. In safekeeping the securities deposited with it, the bank shall exercise such care as is exercised by a depository who receives remuneration and shall take to that effect all the 
precautionary measures as is required in the banking customs. Any agreement relieving 
the bank from such obligations shall be null and void.  
2. The bank shall be held liable for the destruction or theft of su ch securities, save where 
such destruction or theft has resulted from a force majeure event.  
  
Article (461 ) 
A bank may not use the securities deposited with it, whether by disposing thereof, pledging  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 159 the same or exercising the rights derived therefrom, ex cept with a special authorization by the 
customer to do so.  
  
Article (462 ) 
1. The bank shall undertake the management of the securities deposited with it, by collecting 
the profits and value of such due or redeemed securities, and it shall notify the custome r 
depositor of the transactions made to the said securities, such as replacement or renewal thereof, and place the collected sums at the disposal of the depositor and credit them to 
his account.  
2. The bank shall inform the depositor of every matter or right relevant to the security and 
requiring his approval or that is dependent on his preference. Where the depositor's 
instructions are not received in good time, the bank shall dispose of the matter in such 
manner as is beneficial to the depositor who shall be ar the costs.  
3. The bank shall be held liable where it fails to fulfill its obligations and damage is caused to the customer as a result of such failure.  
  
Article (463 ) 
1. The bank shall be entitled to a remuneration against the obligations it assumes. Such 
remuneration shall, in the absence of an agreement, be determined according to the 
custom, subject to the number and value of the securities deposited.  
2. As a guarantee for the bank's receipt of its due remuneration, it shall have the right to 
withhold the sec urities deposited and refrain from returning the same until recovery of its 
right, in addition to the lien prescribed by law over the expenses of safekeeping a movable property.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 160 Article (464 ) 
1. The bank shall return the securities deposited with it on the demand of the depositor with 
due consideration to the time needed for preparation of the securities for such return.  
2. The return shall be effected at the same place where the deposit was effected. The bank 
shall return the same securities deposited and not securities of the same kind with 
different numbers, unless it is agreed to return securities of the same kind or other 
securities or unless the law requires otherwise.  
  
Article (465 ) 
The return of securities shall be to the depositor in person, his legal representative, his heirs 
or his special attorney, as the case may be, even if the security contains something indicating 
that it is owned by a third party.  
  
Article (466 ) 
1. Where the bank loses possession of securities for a reason beyond its control, it m ay file a 
claim for recovery of the same against the person who acquired them.  
2. Where financial securities made to the bearer are lost or stolen, the bank shall inform the 
issuer of such securities of the fact and instruct it to refrain from paying the prof its or value 
of said security to any person who shall claim therefor in case of redemption or maturity.  
  
Article (467 ) 
Where an action is brought for the maturity of the securities deposited with the bank, the bank shall send notice directly to the depositor accordingly and shall abstain from returning the 
securities to him until the action is adjudicated by the court.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 161 Part S ix 
Commercial Transactions  of Islamic  Financial  Institutions  
Chapter O ne 
General Provisions  
Article (468 ) 
1. The provisions set forth in this Part shall apply to commercial transactions and contracts 
to which Islamic financial institutions are a party.  
2. For the purpose of this Part, Islamic financial institutions shall mean any institution whose 
Articles or Memorandum of Association  provides that it is conducting its business 
activities in compliance with the Rules of Islamic Sharia, including any financial institution that conducts part of its business in compliance with the Rules of Islamic Sharia, under a 
license from the competen t authorities, in relation to such business.  
  
Article (469 ) 
Save as specifically stipulated in this Part, the provisions of this Law and of the relevant laws 
shall apply to commercial transactions and contracts concluded in compliance with the Rules 
of Islamic Sharia.  
  
Article (470 ) 
The provisions contained in this Part shall be interpreted and construed according to Sharia 
standards and controls issued or approved by the Sharia Supervisory Board set forth in 
Federal Decree- Law No. (14) of 2018, without prejudice to the provisions of this Law.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 162 Article (471 ) 
The Board of Directors of the Central Bank shall issue the regulations and statutes that lay 
down the controls and rules of commercial transactions of Islamic financial institutions and 
Takaful companies, licensed by such institutions, and which conduct all or part of their 
business activities in compliance with the Rules of Islamic Sharia, after being approved by the Sharia Supervisory Board set out in article (470) above.  
  
Article (472 ) 
The following transactions, whenever carried out by an Islamic financial institution, shall 
constitute commercial transactions governed by the Rules of Islamic Sharia:  
1. Deposit;  
2. Investment account;  
3. Takaful insurance;  
4. Islamic financing instruments;  
5. Investments; and  
6. Any transaction where any statute in force provides that it is governed by the Rules of Islamic Sharia.  
  
Article (473 ) 
1. Islamic financial institutions shall neither borrow nor lend funds with an interest or benefit, in any way whatsoever, nor arrange or charge an interest or benefit for any 
overdue debt sum, including a late payment interest even if by way of compensation, and 
any agreement to the contrary shall be null and void.  
2. The borrowing referred to in this Article shall mean to grant the ownersh ip of funds or 
fungible items to any other person so that the latter would refund or deliver back the same  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 163 item or funds in the same sum, type and properties to the lender at the end of the loan 
term, without requiring, expressly or based on customary prac tice, a benefit in favor of the 
lender or an increase above the borrowed sum.  
  
Article (474 ) 
Financial obligations arising from commercial transactions and contracts governed by the provisions of this Part shall be of specific and definite sum, and shall be deemed debts whose 
sums may not be increased where their maturity dates are deferred, and any agreement to the 
contrary shall be null and void.  
  
Chapter T wo 
Special Provisions  for Certain  Types  of Contracts  and  Obligations  to which 
Islamic  Financial institutions  are a Party  
Section O ne 
Promise to Contract  
Article (475 ) 
1. A promise to contract is an undertaking by a contracting party to enter into a certain 
contract in the future, and such undertaking shall be binding only on the promising party.  
2. Where the promising party fails to fulfill the promise without an acceptable excuse, he 
shall compensate the promised party. The compensation in such case shall be limited to the amount of direct actual damage sustained by the promised party.  
  
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 164 Section T wo 
Installment  Sale 
Article (476 ) 
For the purpose of this Section, an installment sale shall mean every sale conducted for the 
purpose of finance or representing part of a financial transaction, whereby a non -monetary 
asset is exchanged for a deferred monetary  value to be paid over an extended period of time. 
Once the contract is executed, the sold item's ownership shall be transferred to the buyer, and the seller may not retain the sold item's ownership until the price installments are paid, in 
whole or in par t, and any agreement to the contrary shall be null and void.  
  
Article (477 ) 
The installment sale provisions set forth in this Section shall be applicable if it is agreed under 
the contract that the property ownership burdens, or the risks of its loss or d eficiency for a 
matter beyond control would be transferred to the contracting party once the property is 
delivered to the same, even if the contracting parties call the sale a lease.  
  
Article (478 ) 
1. The sold item's price, properties, form, volume and other  distinguishing features thereof 
shall be specified upon signing the contract, and no agreement to contrary may be made.  
2. The sold item's price shall be fixed as provided for in the contract, and no increase in price 
may be stipulated where the payment of installments is delayed for any reason 
whatsoever, and any agreement to the contrary shall be null and void.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 165 Article (479 ) 
Where the contracting parties agree that the sale would be made at the market price, the price 
shall be fixed at the time and place where the contract is made. In case of multiple market 
prices, the average price shall prevail. No agreement may be made to fix the price or enter into 
a contract based on the market price in the future or to be fixed on the basis on a variable 
indic ator.  
  
Article (480 ) 
The contracting parties may agree to authorize a third party to fix the sold item's price to the 
best interests of both parties; provided that such price be fixed at the time of signing the 
contract.  
  
Section T hree  
Murabaha  
Article (481 ) 
Murabaha is a contract whereby a seller sells an asset to a buyer after being owned and 
possessed by the seller, either ipso facto or ipso jure, based on a finance application by the 
buyer. Such sale shall be conducted at cost plus a fixed profit sum,  as set out in the contract, 
and the total value thereof shall constitute the Murabaha sale price.  
  
Article (482 ) 
1. The Murabaha sale price shall, after the contract is concluded, be fixed, and may not be variable or associated with an indicator or otherwis e. 
2. An agreement may be made to pay Murabaha sale price in installments, based on  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 166 installments of a specific sum and specific payment term, or at a single payment on a 
specific date.  
  
Section F our 
Istisna 'a (Manafacture  Contract ) 
Article (483 ) 
Istisna'a is a contract whereby a seller sells to a buyer, based on description, an item required 
to be manufactured, against a fixed lump -sum set out in the contract. The sold item's sort, 
type, quantity and properties shall be indicated in the contract, along wit h the future delivery 
date thereof.  
  
Article (484 ) 
A seller involved in an Istisna'a contract shall provide both the work and the manufacturing materials, and may manufacture the sold item by itself or may assign the same to third parties under a contract  independent of Istisna'a contract.  
  
Article (485 ) 
1. The sale price, after the contract is concluded, may not be variable or associated with an indicator or otherwise.  
2. An agreement may be made to pay Istisna'a sale price in installments of specific sum and 
specific payment term or at a single payment on a specified date.  
  
Article (486 ) 
1. The sold item shall be handed over on the maturity date as agreed in the contract. A free - 
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 167 defect delivery may not be stipulated and any agreement to the contrary shall be null and 
void.  
2. Where the sold item is delivered and some of its properties are materially different, as per 
the customary practices, the buyer shall have the option either to receive and accept the 
sold  item or terminate the contract and pay the price or the paid portion thereof back to 
the seller, or both parties may agree on a new price to be fixed in a timely manner.  
  
Article (487 ) 
The Istisna'a contract may include a stipulation that the buyer shall be entitled to 
compensation if the seller fails to timely deliver the manufactured item, based on an sum to 
be agreed in the contract; save where the delayed delivery is not attributed to the seller or is 
caused by an unavoidable accident.  
  
Section F ive 
Salam  
Article (488 ) 
Salam is a contract whereby a seller sells to a buyer property based on future delivery, without 
requiring the manufacture thereof at an advance price.  
  
Article (489 ) 
1. The price in the Salam contract shall be of a specific quantity and type and shall be 
recorded in the contract, and the period of its future delivery may not exceed (3) three 
days.  
2. Debts may not serve as a price in the Salam contract.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 168 Article (490 ) 
1. The sold item's sort, type, quantity and required specifications shall all be indicated in the 
Salam contract, along with the date of delivery, whether the seller provides the sold item 
by his own or buys it from a third party under a contract independent of the Salam 
contract.  
2. The Salam contract shall create an obligation on t he seller to deliver the sold item and not 
its price. The sold item delivery upon maturity shall be conducted as agreed in the 
contract. Neither a free -defect delivery nor a penalty on the sold item's late delivery may 
be stipulated in the contract, and any agreement to the contrary shall be null and void.  
  
Section S ix 
Ijarah [LEASE]  
Article (491 ) 
Ijarah  is a contract whereby a lessor leases out specific or described property owned by the 
lessor or leased from the same against either a fixed rent set out in the contract or a variable 
rent to be paid at one payment or in installments of specific sum and dates.  
  
Article (492 ) 
Specific property may be leased out only after being owned, leased or received by the lessor.  
  
Article (493 ) 
A promise may be given to the Lessee to transfer thereto the title to the leased property upon expiration of the ijarah term or as mutually agreed. The title transfer shall not be stipulated in 
the ijarah contract, but shall be conducted under a separate contract to be concluded in due  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 169 course.  
  
Article (494 ) 
The rent shall be variable for each lease term set out in the contract ; however, the first lease 
term rent shall be specified in the contract in a specific sum. The rent of every subsequent 
term shall be calculated before the commencement thereof according to a certain indicator or 
criterion that the parties to the contract have no influence over the determination of its price. 
Such indicator or criterion shall be based on a maximum and minimum limit to be stipulated 
in the contract. Where a lease term begins, the rent thereof shall not be variable.  
  
Article (495 ) 
1. The object  of an ijarah contract shall be the benefits of property, and its handover shall be 
fulfilled where such benefits are handed over, and must be capable of being satisfied and 
specified so as to resolve any dispute.  
2. A lessor may not stipulate that he will be  discharged from the liability for defects in the 
leased property, which will prejudice the realization of benefits intended from the ijarah contract, or be discharged from any liability for defects occurring to the property that are 
prejudicial to the realization of its benefits, whether by the lessor's act or for a reason 
beyond his control.  
3. The lessor shall pay the basic costs of maintenance of the leased property and insurance against damage. The lessor may not stipulate that such costs are to be paid by the lessee 
or initially agree to add the same automatically to the rent, and any agreement to the 
contrary shall be null and void.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 170 Article (496 ) 
The provisions set forth in the Law of Finance Lease shall apply to any ijarah where no 
particular provis ion is stipulated in this Chapter.  
  
Chapter T hree  
Islamic  Banking  Transactions  
Article (497 ) 
The board of directors of the Central Bank shall issue the resolutions of Islamic banking 
transactions carried out in compliance with the Rules of Islamic Sharia,  along with the 
administrative sanctions and fines to be imposed by the Central Bank where the regulations and statutes set forth in article (471) above are violated.  
  
Part S even  
Rental  of Safe Deposit  Boxes  
Article (498 ) 
1. Rental of safe deposit boxes is a  contract whereby a bank undertakes to place a certain 
safe deposit box at the disposal of its renter customer, and allows the latter to take advantage of it against a fixed rent.  
2. The bank shall guard the rented safe deposit box and ensure its safety and u sability by 
taking all such measures as are imposed by the banking customary practice.  
  
Article (499 ) 
1. Rented safe deposit boxes shall be openable by two keys, one of which shall be handed 
by the bank to the renter customer and the other one shall be kept by the bank. The bank  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 171 may neither give a copy of the key to any other person, and shall only allow its customer 
or authorized agent to have access to, and to use, the safe deposit box.  
2. The key handed to the renter shall remain the property of the bank and shall be returned 
to it upon the expiry of the rental term.  
3. The bank may use other means of access, such as the automated control system or plastic 
cards.  
  
Article (500 ) 
1. The bank shall be liable for the safety, custody and usability of the safe deposit box, and 
may only deny such liability by proving a force majeure event or a third party's action that 
amounts to a force majeure event.  
2. The bank may not invoke the exoneration clause where an act of fraud or gross negligence is proved to have been committe d by it or by its subordinates.  
  
Article (501 ) 
1. The renter shall use the safe deposit box for the usual purposes, and shall pay the agreed -
upon rent on the maturity dates.  
2. The renter may not place in a safe deposit box any items detrimental to its safety or to the 
safety of the place wherein it is located.  
3. Unless otherwise agreed with the bank, a renter may neither sublet the safe deposit box 
or part thereof, nor may assign the rental to third parties.  
  
Article (502 ) 
1. Unless otherwise agreed, when a safe d eposit box is rented out to several renters, any one 
of them may use it separately.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 172 2. Where a renter dies, the bank may only, after becoming aware of the death, give 
permission for the safe deposit box to be opened with the approval of all parties concerned or based on a court decision.  
  
Article (503 ) 
The bank shall keep a record of dates and times when the renter opens the safe deposit box.  
  
Article (504 ) 
Where the bank finds out that the safe deposit box is endangered or that it contains dangerous items, it shall forthwith notify the renter to report to the bank to either empty the box contents 
or remove the dangerous items therefrom. Where the renter fails to report on the given date, the bank may, under a Writ Petition, request the competent judge of the  court in whose 
jurisdiction the bank is located to give permission to open the box in order to empty it or to remove such dangerous items therefrom, in the presence of any person assigned by the judge 
for such mission. A report on such procedure shall be drawn wherein the box contents shall 
be recorded. Where the danger threatening the safe deposit box is imminent, the bank may, 
at the risk of the bank, open the box and empty it or remove any dangerous items therefrom, 
without any notice or permission from  the competent judge. Such procedure shall be 
performed by a committee consisting of at least (3) three of the bank officers, and a report to that effect shall be drawn up and a copy thereof shall be communicated to the customer.  
  
Article (505 ) 
1. Where the renter fails to pay the box rent on the due dates, the bank may, after the lapse 
of (15) fifteen days, unless further periods are agreed upon, from the date of a notice 
served to the renter requiring payment, consider the contract as automatically terminat ed  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 173 and recover the box, after serving notice to the renter to report to the bank to open the 
box, empty its contents and deliver its key. The notice shall be valid if served to the last address specified by the renter to the bank.  
2. Where the renter fails to  report on the date set or if the contract term expires, the bank 
may, under a Writ Petition, request the competent judge of the court in whose jurisdiction 
the bank is located to give it permission to open the safe deposit box and empty it in the 
presence  of a person delegated by the judge for such purpose. A report on the incident 
shall be drawn up listing the contents and shall be signed by the judge delegate and the bank. The judge may order that the contents be deposited with the bank, or with a truste e 
appointed by the court, until they are handed to their owner or until the judge orders that the same be disposed of.  
  
Article (506 ) 
The bank may withhold the contents of the safe deposit box and shall have lien over the price 
generated from the sale of its contents to collect the rent and the accrued expenses.  
  
Article (507 ) 
1. A precautionary and executory attachment may be levied at the contents of the safe 
deposit box.  
2. The attachment shall be levied by notifying the bank of the contents of the writ by virtue 
of which such attachment is levied, as well as requiring the bank to state whether it has 
rented out a safe deposit box to the attached person. Upon receiving such notice, the bank 
shall forthwith prevent the attached renter from using the box and p romptly notify him 
that the attachment is levied at the safe deposit box.  
3. Where the attachment is precautionary, the renter may request the court to lift the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 174 attachment from all or part of its contents.  
4. Where the attachment is executory, the bank shall ope n the safe deposit box, empty its 
contents, in the presence of the attaching person and the execution officer, and notify the 
renter of the date scheduled for opening the safe deposit box. On the scheduled date, an 
inventory of the box contents shall be made, and such contents shall be delivered to the 
bank or the trustee appointed by the court until they are sold in accordance with the 
procedures set by the court.  
5. Where the safe deposit box contains papers or documents not included in the compulsory sale, they shall be handed over to the renter. However, if the renter is not present at the 
time of opening the box, such papers or documents shall be delivered to the bank for safekeeping after placing them in an envelope sealed with the stamps of both the execution officer and the bank delegate, until they are requested by the renter.  
6. The attaching person shall pay the bank a sum sufficient to secure the rent of the safe deposit box for the attachment period.  
  
Article (508 ) 
Except for the cases provided by the  Law, the bank may open a rented safe deposit box or 
empty its contents only with the permission of the renter and in his presence, or in execution of a judgment, order or decision issued by the court.  
  
 
 
 
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 175 Book F our  
Commercial Papers  
General Provisions  
Definition  and  Types  of Commercial Papers 
Article (509 ) 
Commercial papers are instruments written according to forms prescribed by the Law. 
Commercial papers represent a right to a specific sum payable at sight or after a determined 
or determinable time limit. Commercial papers are negotiable through negotiable 
instruments and the custom generally recognizes the same as a payment instrument instead 
of money.  
  
Article (510 ) 
Commercial papers shall include bills of exchange, promissory notes, bearer instruments, 
cheques and other papers drawn up for commercial activities, which the customary practice 
generally accepts as a payment instrument in transactions.  
  
Article (511 ) 
A bill of exchange (the drawing instrument) is a commercial paper whereby a dr awer draws 
an order for the payment of a specific sum from the drawee, at sight or on determined or determinable date, for the order of the payee.  
  
Article (512 ) 
A promissory note is a commercial paper whereby its issuer undertakes to pay, at sight or on a determined or determinable date, a specific sum to the order of another person (the payee).   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 176   
Article (513 ) 
A bearer instrument is a commercial paper whereby its issuer undertakes to pay a sum to the 
order of bearer, at sight or on a determined or determinable date.  
  
Article (514 ) 
A cheque is a commercial paper containing an order issued by the drawer to the drawee bank to pay on the day indicated therein, as the date of issue, a specific sum to the order of a third 
person, namely the payee or bear er. 
  
Part O ne 
Bill of Exchange  
Chapter O ne 
Drawing  Up a BOF E xchange  
Article (515 ) 
A bill of exchange shall contain the following particulars:  
1. The word "Bill of Exchange" written in the title thereof and in the language in which the 
bill is written;  
2. An unconditional order to pay a fixed sum of money;  
3. Date and place of drawing up the bill;  
4. Signature of the drawer;  
5. Given name and surname of the drawee;  
6. Name of the person to whom or to whose order the payment shall be made (the payee); 
and   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 177 7. Date of maturity and place of payment.  
  
Article (516 ) 
An instrument which does not contain any of the particulars mentioned in article (515) hereof 
shall be deemed a bill of exchange only in the following cases:  
1. Where the date of maturity is not mentioned in the bill, it shall be deemed payable at sight.  
2. Where the place of payment of the bill is not stated therein, the place indicated next to the 
drawee's name shall be deemed the place of payment and the drawee's place of residence 
at the same time. In this case, the bill shall be payable at the drawee's place of residence if 
there is no condition for payment in another place.  
3. Where the place of drawing up the bill is not stated therein, the bill shall be deemed as 
having been drawn up in the place mentioned next to the drawer's name, and where such 
place is not expressly stated, the place of drawing up the bill shall be deemed the place 
where the drawer has signed the same.  
  
Article (517 ) 
1. The signature on a bill of exchange shall be made in writing or by thumb -print.  
2. Two witnesses shall testify that the thumb printer has affixed his thumb before them while 
being aware of the contents of the instrument.  
  
Article (518 ) 
1. Where the bill sum is written in letters and in numbers at the same time, the sum indicated in letters shall prevail in case of discrepancy.  
2. Where the sum is written several times in letters or in numbers, the lesser sum shall prevail 
in case of discrepancy.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 178   
Article (519 ) 
1. A bill of exchange may not contain more than one sum.  
2. Where a bill of exchange is drawn in a currency having a nomenclature common between 
the countries of drawing and payment, without indicating the intended currency, the 
currency of the country of payment shall prevail.  
  
Article (520 ) 
1. A bill of exchange may be signed by more than one  drawer.  
2. A drawer may authorize a third party to sign the bill of exchange on his behalf, in which case, the third party shall indicate his capacity upon signing the bill.  
  
Article (521 ) 
1. No interest may be stipulated on the sum mentioned in the bill of exchange, unless it is 
made payable at sight or after a specific period from the time of sight.  
2. The interest rate shall be stipulated in the bill itself, otherwise, the stipulation shall be null 
and void.  
3. The interest shall be applicable from the date of d rawing up the bill of exchange, unless 
any other date is set.  
  
Article (522 ) 
1. A person who signs, without authorization, a bill of exchange on behalf of another person 
shall be personally liable thereunder. If he discharges said liability, the rights which  would 
have devolved to the person on whose behalf he purported to have acted shall devolve to him.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 179 2. The above provision shall apply to the representative if he acts beyond the limits of his 
powers.  
  
Article (523 ) 
Where a bill of exchange bears forged signatures, or signatures of fictitious persons, or 
signatures of persons who have no capacity to incur liability, or where the signatures do not 
bind the signatories thereof for other reasons, or do not bind those persons on whose behalf 
the bill is signe d, the obligations of the other signatories shall nevertheless remain valid.  
  
Article (524 ) 
Obligations of a person with diminished capacity, who is not authorized to engage in 
commerce, and an incapacitated person, arising from affixing their signatures to a bill of 
exchange, in any capacity whatsoever, shall be null and void with regard to themselves only; 
however, they may invoke such nullity against each bearer of such bill.  
  
Article (525 ) 
1. A bill of exchange may be drawn to the order of the drawer him self.  
2. It may be drawn on its drawer.  
3. It may be drawn to the account of another person.  
  
Article (526 ) 
1. The form of a bill of exchange shall be governed by the Law of the state where it is drawn 
up. 
2. The capacity of the obligor of a bill of exchange shall be determined according to the law of his country, and where such law refers to that of another State, the latter shall be  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 180 applicable.  
3. Where the applicable Law considers the obligor as a person lackin g legal capacity, his 
obligation under the bill shall nevertheless remain valid if he affixed his signature thereto 
in a state whose law considers the obligor a person with full capacity.  
  
Article (527 ) 
A bill of exchange may be made payable in the place of residence of another person, whether 
in the place where the drawee's place of residence is located or in any other place.  
  
Article (528 ) 
1. A drawer of a bill of exchange shall guarantee its acceptance and payment.  
2. A drawer of a bill of exchange may further stipulate that he shall be exempted from the 
guarantee of acceptance; however, any stipulation for exemption from the guarantee of 
payment shall be deemed null and void.  
  
Chapter T wo 
Negotiability  of a Bill of Exchange  
Article (529 ) 
1. Any bill of exchange shall be negotiable by indorsement, even if it does not contain an 
express stipulation that it is drawn to order.  
2. A bill of exchange shall be unnegotiable when the drawer stipulates therein that it is not "to order", save in pursuance of the provisions of the transfer of right.  
3. Endorsement may be made to the drawee, regardless of whether the drawee accepts the bill of exchange or not. In addition, Endorsement may also be made to the drawer or to 
any other obligor, and all the foregoing persons may re -endorse the bill of exchange.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 181   
Article (530 ) 
1. Without prejudice to the provisions of article (534) hereof, the Endorsement shall be 
unconditional, and any condition attached to the Endorsement shall be null and void.  
2. A partial Endorsement shall be null and void.  
3. An Endorsement to bearer shall be a blank indorsement.  
  
Article (531 ) 
1. An Endorsement shall be written on the bill of exchange itself or on a paper attached 
thereto, and shall be signed by the endorser.  
2. An Endorsement may be signed only by the endorser (blank endorsement). In order for an 
Endorsement to be valid in this case, it shall be written on the back of the bill or on the 
paper attached thereto.  
  
Article (532 ) 
The Endorsement shall transfer to the endorsee all rights arising from the bill.  
  
Article (533 ) 
In case of a blank indorsement, the bearer shall:  
1. Fill out the blank by writing his name or the name of another person;  
2. Re-endorse the bill in blank or to another person; or  
3. Deliver the bill to another person without filling out the blank and without endorsing it.  
  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 182 Article (534 ) 
1. The endorser shall guarantee the acceptance and payment of the bill, unless otherwise 
stipulated.  
2. The endorser may prohibit the re -Endorsement of bill, and in such case, he shall not be 
liable for the guarantee vis -à-vis the person to whom the bill is transferred by means of a 
subsequent endorsement.  
  
Article (535 ) 
The possessor of a bill of exchange shall be its legal bearer when he proves that he is the holder of right thereto by means of uninterrupted endorsements, even if the last one is in 
blank. Erased endorsements in this regard shall be null and void. If the endorsement in blank 
is followed by a subsequent endorsement, the signatory on the last endorsement shall be the 
one to whom the  right to the bill is devolved.  
  
Article (536 ) 
Where a person loses possession of a bill of exchange, the bearer shall not be bound to 
surrender it if he proves his right thereto in accordance with the preceding Article, save where 
he has acquired it in b ad faith or if he had committed a gross fault in order to acquire it.  
  
Article (537 ) 
Without prejudice to the provision of article (524) above, a debtor who is sued for a bill of 
exchange may not invoke against its bearer the pleas based on his personal r elationships with 
the drawer or with one of its previous bearers, except where the bearer's intent at the time of 
acquiring it was to cause harm to the debtor.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 183 Article (538 ) 
1. Where the endorsement includes the phrase "value for collection" or "value for r eceipt" or 
any other term indicating the procuration, the bearer may exercise all the rights arising 
from the bill of exchange, including the right to institute an action in his personal name 
and may endorse it only to the effect of procuration.  
2. In this case, obligors may only invoke against the bearer the please that may be invoked 
by them against the endorser.  
  
Article (539 ) 
1. Where the endorsement includes the phrase of "value for security" or any other 
expression purporting to the pledge of the right established by the bill of exchange to the 
endorsee, the bearer may use all the rights arising from the bill of exchange. Nevertheless, 
where the bearer endorses the bill of exchange, such endorsement shall be deemed as 
having been made as power of attorne y. 
2. In this case, obligors of the bill of exchange may not invoke against the bearer the pleas based on their personal relationships with the endorser, save where the bearer's intent, at the time of acquiring the bill of exchange, was to cause harm to the d ebtor.  
  
Article (540 ) 
1. An endorsement after the date of maturity shall produce the same effects as an endorsement prior to such date; however, an endorsement subsequent to a non -payment 
protest or after the expiry of the time limit set by the Law for makin g the protest shall only 
produce the same effects as for the transfer of right.  
2. An endorsement which does not bear a date shall be deemed to have been made before 
the expiry of the time limit fixed for the protest, unless the contrary is proved.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 184   
Article (541 ) 
An endorsement may not be predated. A predated endorsement shall be considered forgery.  
  
Chapter T hree  
Consideration  for Payment  of the Bill of Exchange  
Article (542 ) 
The drawer of a bill of exchange or the person for whose account it was drawn shall be bound 
to make available to the drawee sufficient funds to pay the value thereof; however, the person 
who has drawn for the account of another shall be held personally liable exclusively towards 
the endorsers and the bearer of the bill of exchange for providing the funds for payment.  
  
Article (543 ) 
The consideration for payment shall be deemed available when, on the maturity date of the 
bill of exchange, the drawee is indebted to the drawer or to the person who ordered the 
drawing for a sum which is due and at least equal to the sum of the bill of exchange.  
  
Article (544 ) 
1. The acceptance of a bill of exchange shall be considered a presumption that the 
consideration required for payment is available with the acceptor. This presumption shall 
not be ch allenged as to the relationship between drawee and bearer.  
2. In case of denial, only the drawer shall be bound to prove, irrespective of whether the bill of exchange was accepted or not, that the drawee had the consideration for payment on 
the maturity date.  If he fails to do so, he shall guarantee the payment, even if he had  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 185 protested after the time limit prescribed by the law. In case the drawer proves that the 
consideration is available and continues to be available until the date on which the protest was supposed to have been made, he shall be relieved from liability to the extent of such 
consideration, save where it had been used in his interest.  
  
Article (545 ) 
1. The title to the consideration for payment shall pass ipso jure to the consecutive bearers 
of the bill of exchange.  
2. Where the consideration for payment is less than the sum of the bill of exchange, the 
bearer shall be vested with regard to such shortage in consideration with all the rights 
vested upon him for the entire consideration.  
3. The provision  stipulated in Clause (2) of this Article shall apply in the event that the 
consideration for payment is disputable, uncertain or undue on the maturity date of the 
bill of exchange.  
  
Article (546 ) 
The drawer shall, even if he filed a protest after the statutory time limit, deliver to the bearer 
of the bill of exchange the documents required to obtain the consideration for payment. 
Where the drawer is declared bankrupt, the bankruptcy trustee shall do so; however, the 
bearer of the bill of exchange shall in  all cases assume all the expenses incurred in this respect.  
  
Article (547 ) 
Where the drawer is declared bankrupt, the time limit shall lapse and the date set for payment 
of the value of the bill of exchange shall fall due. The bearer –  not the other creditors of the 
drawer - shall be exclusively entitled to receive his right from the consideration for payment  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 186 available with the drawee.  
  
Article (548 ) 
1. Where the drawee is declared bankrupt and the consideration for payment is a debt owed 
by the same, such debt shall be included in the assets of the bankruptcy.  
2. Where the drawee who is declared bankrupt has possession on behalf of the drawer of goods, commercial papers, securities or any other properties that may be recovered 
according to the provisions of th e Bankruptcy Law, and such property is expressly or 
implicitly allocated for payment of the value of the bill of exchange, the bearer shall have 
a priority to collect his right from the value thereof.  
  
Article (549 ) 
1. Where several bills of exchange have been drawn on one consideration insufficient to 
accommodate them all, the priority in recovering their value shall be given to the order of 
the dates of their drawing.  
2. Where the said bills of exchange were drawn on the same date, the bill bearing the 
drawe e's acceptance shall have priority. Where none of the bills of exchange bears the 
drawee's acceptance, the bill for which a consideration for payment has been allocated 
shall have priority. Bills of exchange containing a stipulation for non -acceptance shall rank 
last in the order of priority.  
  
 
 
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 187 Chapter F our 
Acceptace  of Bill of Exchange  
Article (550 ) 
The bearer or possessor of a bill of exchange may, during the period from its drawing up to 
the date of its maturity, present it to the drawee at his place  of residence for acceptance.  
  
Article (551 ) 
1. The drawer of a bill of exchange may stipulate that the same be presented for acceptance 
on a specific date or without specifying any date.  
2. The drawer may stipulate that the bill be not presented for acceptance , unless it falls 
payable with a person other than the drawee or in a place other than his domicile or 
payable after specific period from sight.  
3. He may also stipulate not to be presented for acceptance before a specified time limit.  
4. Every endorser may stipulate that the bill of exchange must be presented for acceptance on a specified date or any date without specification, unless the drawer had stipulated that 
it must not be presented for acceptance.  
  
Article (552 ) 
A bill of exchange that falls payable  after the lapse of a certain period from sight must be 
presented for acceptance within one year form its date. The drawer may shorten or extend 
such time limit, and every endorser may only shorten such time limit.  
  
Article (553 ) 
1. The drawee may request th at the bill of exchange be re -presented for acceptance on the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 188 next day following the first presentation; however, persons concerned may not allege that 
such request was rejected, unless it has been mentioned in protest.  
2. The bearer of a bill of exchange pre sented for acceptance shall not be bound to surrender 
it to the drawee.  
  
Article (554 ) 
1. The acceptance shall be written on the face of the bill of exchange with the word 
"accepted" or any other phrase having the same meaning, and shall be signed by the 
drawee.  
2. The mere signature of the drawee on the face of the bill of exchange shall be deemed as 
acceptance.  
3. The date of acceptance shall be stated as being on the same day on which acceptance occurred if the bill of exchange is due for payment after a cert ain period from being seen, 
or where it is stipulated that it must be presented for acceptance within a specific time limit, pursuant to a condition pertaining thereto, unless the bearer requires that the date 
of acceptance is to be stated on the same day of acceptance.  
4. Where the date of acceptance is not stated, the bearer may, in order to preserve his rights, have recourse against the endorsers, and the drawer shall establish the lack of date by 
means of a protest made in due course.  
  
Article (555 ) 
1. The acceptance must be unconditional; however, the drawee may restrict it to part of the 
sum of the bill of exchange.  
2. Any modification to the particulars of the bill of exchange introduced to the wording of 
the acceptance shall be deemed as refusal of acceptance. Nevertheless, the acceptor shall  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 189 remain bound by the contents of the acceptance wording.  
  
Article (556 ) 
1. Where the drawer stipulates on the bill of exchange for a place for payment, other than 
the drawee's place of residence, without naming the person to whom payment is to be 
made, the drawee may designate the name when signifying his acceptance. If he fails to do so upon acceptance, the accepting drawee shall be bound to make the payment at the 
place designated therefor.  
2. Where the bill of exchange is d ue for payment at the drawee's place of residence, he may 
specify in the acceptance wording an address at the place where the payment shall be made.  
  
Article (557 ) 
1. Where the drawee accepts the bill of exchange, he shall be bound to pay its value on the maturity date.  
2. In the event of non -payment, the bearer may, even if he is the drawer himself, have 
recourse against the drawee acceptor by instituting a direct action arising from the bill of exchange and claiming all the rights which may be legally claime d. 
  
Article (558 ) 
1. Where the drawee crosses out its acceptance stated on the bill of exchange before returning it, the acceptance shall be deemed rejected, and the crossing out shall be 
deemed to have been occurred before the bill of exchange is returned, unless otherwise 
proved.  
2. Where the drawee notifies the bearer or any other signatory in writing of its acceptance, it  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 190 shall be bound vis -à-vis them by such acceptance.  
  
Chapter F ive 
Aval 
Article (559 ) 
1. The payment of the bill of exchange, in whole or in part, may be guaranteed by an aval.  
2. Such an aval may be given by a third party or even by a person who has signed as a party 
to the bill.  
  
Article (560 ) 
1. The aval shall be written on the bill of exchange itself or on a paper attached thereto in 
such wording as to indicate being an "aval" and shall be signed by the giver of the aval.  
2. Such aval shall be established by the mere signature of the giver of the aval placed on the face of the bill of exchange, unless such signature is affixed by the drawee or drawer.  
3. The wording of the aval shall include the name of the guarantor, otherwise, it shall be 
deemed as issued for the drawer.  
  
Article (561 ) 
1. The giver of an aval is bound as the person for whom he has become guarantor.  
2. The liability of the giver of an aval shall be valid even if the obligation guaranteed is void 
for any reason whatsoever, other than a defect in the form.  
3. Where the giver of an aval pays the bill of  exchange, all rights arising therefrom shall 
devolve on itself vis -a-vis the guaranteed party and every party liable towards the latter 
under the bill of exchange.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 191 Article (562 ) 
1. Aval may be issued on a separate paper indicating the place where it is made.  
2. The giver of an aval who has given the collateral on a separate paper shall be liable only 
vis-a-vis the person in whose favor the aval is given.  
  
Chapter S ix 
Maturity  of the Bill of Exchange  
Article (563 ) 
1. A bill of exchange shall contain a single date of maturity.  
2. The drawer may set the date of maturity of the bill of exchange by any of the following methods:  
3. At sight;  
4. At a fixed period after sight;  
5. At a fixed date; or  
6. After a fixed period after being created.  
7. A bill of exchange which contains maturities other than those mentioned in Clauses (1) 
and (2) above, shall lose its feature as a commercial paper.  
  
Article (564 ) 
1. A bill of exchange that falls payable at sight shall be payable once presented, and shall be presented for payment within one year of the date of being drawn up. The drawee may shorten or extend such time limit but the endorsers may only shorten the same.  
2. The drawer may stipulate that the bill of exchange payable at sight be not presented before the lapse of a fixed period of tim e, and in such case, the time for presentation shall 
be calculated from the maturity of such period of time.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 192   
Article (565 ) 
1. The maturity date of a bill of exchange payable after a fixed period after sight shall be 
calculated as from the date of acceptance  or from the date of protest.  
2. Where no protest is made, the undated acceptance shall be deemed as having occurred vis-a-vis the acceptor on the last day of the time limit set for presenting the bill of exchange 
for acceptance, pursuant to article (552) abo ve. 
  
Article (566 ) 
1. Where a bill of exchange is made payable after one month or more after its date of sight, it shall fall due on the corresponding date of the month during which payment is to be 
made. In the absence of a corresponding date in the month during which the bill of 
exchange shall be paid, it shall fall due on the last day of such month.  
2. Where the bill of exchange is drawn for one month and a half or for several months and a 
half after its date or after the date of sight, the calculation shall begin to run on the basis 
of full months. The phrase of "half month" shall mean (15) fifteen days.  
  
Article (567 ) 
1. Where the bill of exchange is payable on a specific date in a country where the calendar is 
different from that of the country of issue, the  date of maturity shall be deemed as having 
been determined according to the calendar of the country of payment.  
2. Where the bill of exchange is drawn between two countries having different calendars 
and it is payable after a certain period from its date, th e date of drawing shall be adjusted 
to the corresponding day of the calendar of the country of payment and the date of 
maturity shall be determined accordingly. The date of presentation of the bill shall be  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 193 determined according to the foregoing rules.  
3. The above rules shall not apply when it appears from a stipulation in the bill of exchange 
or in its particulars that different rules are applicable.  
  
Chapter S even  
Payment  of the Bill of Exchange  
Article (568 ) 
1. The bearer of a bill of exchange shall present it for payment on the date of maturity.  
2. Presenting a bill of exchange to any of a legally -recognized clearing house shall constitute 
an act of presentation for payment.  
  
Article (569 ) 
1. Where a drawee pays off the bill of exchange, he may recover it from the  bearer duly 
signed to the effect of payment.  
2. The bearer may not refuse partial payment.  
3. In the event of partial payment, the drawee may request such payment to be stated in the 
bill of exchange and a receipt for the sum to be issued. The drawer, endorsers  and any 
obligor under the bill of exchange shall be discharged up to the sum paid and the bearer 
shall protest the unpaid sum.  
  
Article (570 ) 
1. The bearer of a bill of exchange may not be compelled to receive its value before the 
maturity date.  
2. Where the drawee pays off the value of the bill of exchange before the maturity date, he 
shall bear any consequences resulting therefrom.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 194   
Article (571 ) 
Any person who pays off the value of a bill of exchange on the maturity date without valid 
objection shall be discharged, unless he had committed fraud or gross fault. Such person shall 
satisfy himself with the regularity of the endorsement sequence, but he is not bound to verify 
the authenticity of the signatures of the endorsers.  
  
Article (572 ) 
1. Where payment of t he value of the bill of exchange in the United Arab Emirates is to be made 
in a currency that is not officially traded therein, the payment shall be made in the national currency according to the rate of exchange prevailing on the maturity day. Where the 
payment is not effected on the day of maturity, the bearer shall have an option to claim 
payment of the value of the bill of exchange valuated in the national currency, as per the rate 
of exchange prevailing either on the day of maturity or on the date of p ayment. The current 
custom in the place of payment shall apply for the exchange rate of foreign currency, unless the drawer had fixed in the bill itself the rate on the basis of which the payable sum shall be calculated.  
2. The provisions of Clause (1) above shall not apply in the event where the drawer had expressly stipulated that payment of the bill of exchange must be made in the foreign 
currency specified in the bill itself, subject to the laws pertaining to currency and the control 
over foreign remittanc e. 
3. Where the value of a bill of exchange is specified in a currency having a common 
denomination in several countries but a different value in the country of drawing and the 
country of payment, it shall be assumed to mean the country of payment.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 195 Article (573 ) 
1. Where a bill of exchange is not presented for payment on the date of maturity, any debtor 
thereof may deposit its value with the treasury of the court within whose jurisdiction the 
place of payment is located. Such deposit shall be at the bearer's ex pense and under his 
responsibility and against a receipt to be delivered to the depositor stating the sum deposited, the date of drawing up the bill of exchange, the maturity date thereof and the 
name of the person in whose favor it was originally drawn up . 
2. Where the bearer claims payment from the debtor, the latter shall deliver to the bearer the 
receipt for the deposit against the surrender of the bill of exchange on which it is marked that payment was made by virtue of the said instrument. The bearer shall in this case 
receive the sum deposited with the court against such instrument. If the debtor fails to 
deliver the deposit receipt to the bearer, he shall be bound to pay the value of the bill of 
exchange.  
  
Article (574 ) 
Objection to the payment of a bill of exchange or refusing to pay it shall be acceptable only in 
case of loss or bankruptcy of its bearer.  
  
Article (575 ) 
1. Where a non -accepted bill of exchange, which is part of a set, is lost, the person entitled to its 
value may claim payment by virtue of one of its other copies.  
2. Where a bill of exchange is drawn up in several copies and the part which bears the 
acceptance is lost, the payment thereof may not be claimed under one of the other copies, 
except with an order by the chief justice of the competent court, provided that a guarantor is 
provided.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 196   
Article (576 ) 
A person who has lost a bill of exchange, whether accepted or not, and is unable to present 
one of the other copies, may request the chief judge of the competent court for an order to 
have its value paid, provided that he proves his title thereto and provides a guarantor.  
  
Article (577 ) 
1. In the event of refusing to pay the value of a lost bill of exchange after claiming its payment, pursuant to the provisions of the preceding two Articles, its owner shall 
document such refusal in a protest to be made on the day following the date of maturity, 
and shall notify the drawer and endorsers of the same in such manner and within such 
time -limits as provided for in article (591) hereunder.  
2. The pr otest shall be made within the time limit mentioned in Clause (1) above, even if it is 
impossible to obtain a decision from the competent court in due course.  
  
Article (578 ) 
Payment of the value of a bill of exchange on the date of maturity, based on a co urt order in 
the cases referred to in Articles (575) and (576) above, shall discharge the debtor from liability.  
  
Article (579 ) 
The obligation to provide a giver of an aval, as set forth in Articles (575), (576) and (580) of 
this law, shall lapse after (3 ) three years if no claim or action is filed within such time limit.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 197 Article (580 ) 
1. The owner of a lost bill of exchange may obtain a copy thereof by referring to his preceding 
endorser, who shall assist and authorize him to use his name in order to claim from the 
previous endorser, and so on from one endorser to another up the drawer.  
2. Every endorser shall annotate his endorsement on the copy of the bill of exchange delivered by the drawer after being annotated that it is in lieu of the missing origin al. 
3. Payment may not be claimed under the said copy except with an order from the chief 
judge of the competent court and subject to the provision of a guarantee.  
4. All expenses incurred in this respect shall be borne by the owner of the bill of exchange.  
  
Chapter E ight  
Claim and  Recourse  Against  Obligors  of the Bill of Exchange  
Article (581 ) 
A holder of a bill of exchange, in case of non -payment thereof on the date of maturity, may 
have recourse against endorsers, drawer and other obligors thereof.  
  
Article (582 ) 
1. A holder may have recourse against obligors of a bill of exchange prior to the date of 
maturity in the following cases:  
a. Total or partial refrainment from acceptance;  
b. Bankruptcy of the drawee, whether he accepted the bill of exchange or not, or when 
he suspends payment, even if no adjudication is rendered declaring his bankruptcy, or 
when an attachment of no avail is levied at his property; or  
c. Bankruptcy of the drawer of the bill of exchange required not to be presented for 
acceptance.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 198 2. The giver of an aval may request a time limit for payment when recourse is exercised 
against him in the two cases provided for in Paragraphs (b) and (c) of Clause (1) above, by 
applying to the Court of First Instance within whose jurisdiction his place of residence is 
located, within (3) three days from the date of recourse against him. Where the Court of 
First Instance considers that the grant of the time limit is justifiable, it shall determine in 
its decision the date on which the payment shall be conducted; provided that it does not 
exceed the date set for maturity. The Court's decision in this respect shall be non -
appealable.  
  
Article (583 ) 
1. Where the maturity date of a bill of exchange is a public or bank holiday, the payment 
thereof may be claimed only on the following business day.  
2. Similarly, no action may be taken in relation to the bill of exchange and commercial papers, such as presentation for acceptance or making a protest, except on a business day.  
3. If an action related to the bill of exchange and commercial pap ers is scheduled to be taken 
within a specified time limit and the last day of such time limit is a public or bank holiday, 
the time limit shall be extended to the next business day.  
4. The intervening holidays shall be calculated within the time limit.  
5. The first day of the time limit shall not be considered when calculating statutory or 
contractual time limits related to the bill of exchange and commercial papers.  
  
Article (584 ) 
Refrainment from acceptance or payment of the bill of exchange shall be proved by a protest 
for non -acceptance or a protest for non -payment, which shall be executed through the 
competent Notary Public; provided that one copy thereof shall be served to the addressee of  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 199 the protest.  
  
Article (585 ) 
1. The protest shall contain a true copy  of bill of exchange with all the particulars stated 
therein, as to its acceptance, endorsement, giver of an aval, payment of its value, if 
applicable, and any other particulars. The protest shall also contain the notice to pay the 
value of the bill of exc hange, whether the person liable to accept or pay such value is 
present or absent, the reasons of non -acceptance or non -payment, the inability to affix the 
signature or refusal to sign and the sum paid from the value of the bill of exchange in case 
of partial payment.  
2. The protest for non -acceptance or non -payment shall be communicated in the domicile 
of the obligor of the bill of exchange or in the last domicile known for him.  
  
Article (586 ) 
The competent notary public shall record day -by-day all the papers related to the protest in 
chronological order in a special register with numbered and duly annotated pages.  
  
Article (587 ) 
The competent Notary Public shall also during the first (10) ten days of every month send to 
the competent Commercial Registr y office a list of protests for non -payment executed during 
the previous month. The competent Commercial Registry office shall keep a book to record such protests. Every person may have access to such protests and obtain a copy thereof 
against payment of t he prescribed fees. The said office shall publish a bulletin containing such 
protests.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 200 Article (588 ) 
1. A protest for non -acceptance shall be made within the time -limits set for presentation of 
the bill of exchange for acceptance. Where the first presentation for acceptance, pursuant 
to article (552), falls on the last day of such time limit set for presentation, the non-
payment protest may be made on the following day.  
2. Where the bill of exchange is due for payment at sight, the protest for non -payment shall 
be made according to the conditions stipulated in Clause (1) above pertaining to the non-
acceptance protest.  
3. Where the bill of exchange is due for payment on a specified date or after a certain period 
from the date of drawing up or sight, the protest for non -payment shall be made on either 
of the two business days following the date of maturity.  
4. The protest for non -acceptance shall substitute the need for presenting the bill of 
exchange for payment and for making a protest for non -payment.  
  
Article (589 ) 
No instrument may substitute the protest except in the cases stipulated by the Law.  
  
Article (590 ) 
1. Where the drawee suspends payment, whether he has accepted the bill of exchange or 
not, or in case an attachment of no avail is levied on his property, the bearer of the bill of 
exchange may have recourse against the giver of an aval only after presenting the bill of 
exchange to the drawee for payment and making a protest for non -payment.  
2. Where the drawee is declared bankrupt, whether he has accepted the bill of exchange or 
not, or in case of bankruptcy of the drawer of the bill of exchange who has stipulated for non -presentation for acceptance, the presentation of the bankruptcy judgement shall be  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 201 sufficient to enable the bearer to exercise his rights of reco urse against the giver of an aval.  
  
Article (591 ) 
1. The bearer of a bill of exchange shall notify its drawer and his endorser of the non -
acceptance or non -payment thereof within the (4) four business days following the date 
of protest, or the date on which it is presented for acceptance or payment if it contains the 
stipulation for recourse without costs. Every endorser shall, within the two business days 
following his receipt of the notice, be bound to notify in his turn his endorser of his receipt 
of such notice, giving him the names and addresses of the previous notifying persons, and 
so on from one endorser to another up to the drawer. The time limit shall, vis -a-vis each 
endorser, commence from the date on which he received the notice from his previous 
endorser.  
2. Where one of the signatories has been notified on the bill of exchange itself, pursuant to Clause (1) above, it shall also be compulsory to notify the giver of aval on the same date.  
3. Where one of the endorsers has failed to state his address or has stated it in an illegible 
manner, it shall be sufficient to notify his previous endorser.  
4. Any person who is bound to serve the notice may perform it in any manner whatsoever, even by returning the bill of exchange itself.  
5. The person who is bound to send the notice shall prove that he did so within the time limit 
prescribed therefor; and such time limit shall be deemed to be observed if he delivered the 
registered letter containing the notice to the Post Authority within the said time limit.  
6. The person who  is bound to serve the notice shall not forfeit his rights if he fails to do so 
within the prescribed time limit, but he shall be required, if applicable, to compensate the 
damage arising from his negligence; provided that the compensation shall not exceed  the 
sum of the bill of exchange.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 202   
Article (592 ) 
1. The drawer, every endorser or giver of an aval may exempt the bearer from the obligation 
of making the protest for non -acceptance or non -payment upon recourse if it is stipulated 
in the bill of exchange for (recourse without costs) or (without protest) or any other 
stipulation having the same meaning and signed by him.  
2. Such stipulation shall neither exempt the bearer from presenting the bill of exchange within the prescribed time limits, nor serving the required notices. Any person who 
invokes vis -a-vis the bearer the non -adherence to such time limits shall prove the same.  
3. Where the drawer stipulates for recourse without costs, the effects of such stipulation 
shall apply to all signatories; however, if the same is stipulated by an endorser or giver of 
an aval, its effects shall apply to him only.  
4. Where the drawer makes such stipulation and the bearer however protests the same, the 
bearer shall solely bear the costs. If the stipulation is made by an endorser or a giver of an 
aval, recourse may be exercised against all the signatories for the costs of prot est, if 
applicable.  
  
Article (593 ) 
1. Persons who have committed themselves under the bill of exchange shall be jointly liable towards its bearer.  
2. The bearer may have recourse against such obligors, separately or jointly, without having to observe the order of their obligations.  
3. The right of recourse of each signatory on the bill of exchange shall, if he pays its value, be established against the obligors towards him. However, an action instituted against any 
of such obligors shall not prevent the right of re course against others, even if they are  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 203 subsequent to the obligor against whom the action was initially instituted.  
  
Article (594 ) 
1. A bearer of a bill of exchange may claim from the person having a right of recourse against 
him the following:  
a. The original sum of a non -accepted or non -paid bill of exchange, along with the agreed 
interest, if applicable;  
b. The interest calculated according to the prevailing banking rate, as of the date of maturity; and  
c. Costs of the protest, notices and any other expenses.  
2. In th e cases of recourse exercised before the maturity date of the bill of exchange, a sum 
equal to the official discount rate on the date of recourse and in the place where the 
bearer's place of residence is located shall be deducted from the value of the bill of 
exchange.  
  
Article (595 ) 
Any person having paid the value of the bill of exchange may claim from the obligors committed towards him to reimburse him the sum paid and the expenses incurred.  
  
Article (596 ) 
Courts may not grant a time limit for paying the value of the bill of exchange or to undertake any action related thereto, except in the cases stipulated by the Law.  
  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 204 Article (597 ) 
1. Any obligor who, by way of recourse, is claimed or is likely to be claimed to pay a bill of 
exchange, may, if he effects the payment, request that the bill, together with the protest 
and a receipt for the sum paid, be surrendered to him.  
2. Any endorser who paid the bill of exchange may cross out his endorsement and all subsequent endorsements.  
  
Article (598 ) 
In case t he recourse is exercised after partial acceptance, the person who has paid the non -
accepted part of the value of the bill of exchange may require its bearer to prove such payment 
of the bill itself and deliver him a clearance. Furthermore, the bearer shall be bound to hand 
him a copy of the bill of exchange certified by him as a true copy, together with the protest, in 
order to enable him to exercise his right of recourse against others for the sum paid by him.  
  
Article (599 ) 
1. The bearer of a bill of exchange shall forfeit his right, pursuant to the rules of the Exchange 
Law, to have recourse against the drawer, endorsers and other obligors, except the acceptor, upon the expiry of the time limits set for the undertaking the following:  
a. Present the bills  of exchange payable at sight or a certain period after sight.  
b. Make a protest for non -acceptance or non -payment.  
c. Present the bill of exchange for payment if it contains a stipulation of recourse without 
costs.  
2. Nevertheless, the drawer shall take advantage of such forfeiture only if he proved that he 
made available the consideration for payment on the maturity date, in which case, the 
bearer may have recourse only against the drawee.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 205 3. Where a bill of exchange is not presented for acceptance within the time limit set by the 
drawer, the bearer shall forfeit his right of recourse, due to the non -acceptance and non-
payment, unless it is revealed from the wording of the stipulation that the intention of the 
drawer thereby was to relieve himself from guaranteeing the acceptance.  
4. Where the endorser stipulates on his endorsement for a date for presentation of the bill of 
exchange for acceptance, he may solely take advantage of such stipulation.  
  
Article (600 ) 
1. Where due to a force majeure event a bill of exchange is not presented or protested within 
the prescribed time limits, such time limit shall be extended.  
2. The bearer shall, without delay, notify his endorser of the force majeure event. Such notice 
shall be dated and signed by the bearer on the bill itself or the attached paper. Such notices 
shall be sequentially served from one endorser to another up to the drawer, pursuant to 
article (591) above.  
3. When the force majeure even ends, the bearer shall, without delay, present the bill of exchange for acceptance or paym ent, then make the protest when necessary.  
4. Where the force majeure event continues for more than (30) thirty days, as of the maturity date, recourse may be exercised against the obligors with no need to present the bill of exchange or make a protest.  
5. Where  the bill of exchange is payable at sight or a certain period after sight, the time limit 
of (30) thirty days shall run from the date on which the bearer notifies his endorser of the 
force majeure event, even if such date is prior to the expiry of the time  limits set for 
presentation of the bill of exchange. The sight period shall be extended to more than the (30) thirty days if the bill of exchange is payable after a certain period from the sight.  
6. Matters related to the person of the bearer or any person d elegated by him to present or  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 206 protest the bill of exchange shall not be deemed a force majeure event.  
  
Article (601 ) 
The bearer of a bill of exchange protested for non -payment may levy a precautionary 
attachment, without the need to submit a guarantee, at the property of the drawer, acceptor, 
endorser, giver of an aval or any other obligors under the bill of exchange, su bject to the 
provisions stipulated for such attachment in the Civil Procedures Code, except for providing a guarantee.  
  
Article (602 ) 
1. Any person having a right of recourse against other obligors under the bill of exchange 
may recover his right by drawing a new bill of exchange on one of his gives or an aval to 
be payable at sight and at the place of residence of such giver of aval, unles s otherwise 
provided.  
2. A recourse bill of exchange shall include the sums set forth in Articles (594) and (595) 
above, plus any commissions and other fees prescribed by Law.  
3. Where the drawer of a recourse bill of exchange is himself the bearer, its sum shall be 
determined on the same basis as that adopted to fix the value of a bill of exchange due for 
payment at sight, drawn from the place where the original bill of exchange was payable 
on the place of residence of the giver of an aval lies.  
4. Where the drawer  of a recourse bill of exchange is an endorser, its sum shall be 
determined on the same basis as that adopted to fix the value of a bill of exchange payable 
at sight, drawn from the place wherein the place of residence of the drawer of the bill of 
exchange  is located, on the place where the giver of an aval's place of residence is located.  
5. In case of multiple recourse bills of exchange, the drawer of the original bill or any  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 207 endorser of such bill may not be required to pay more than the value of one recours e bill 
of exchange.  
  
Chapter N ine 
Intervention for Honor  
Section O ne 
General Provisions  
Article (603 ) 
1. A drawer, endorser or giver of an aval of a bill of exchange may designate a person who 
shall accept or pay the bill, where necessary.  
2. A bill of exchange  may be accepted or paid by a person intervening for the interest of any 
obligor thereof, who may be subject of recourse, subject to the conditions set forth in the following Articles of this Chapter.  
3. The intervening person may be a third party, the non- accepting drawee or any obligor 
under the bill of exchange; however, he may not be the accepting drawee.  
4. The intervening party shall, within the two business days following the intervention, 
notify the party in whose favor the intervention took place; otherw ise, he shall be liable, 
where applicable, to compensate for any damage caused by his negligence; provided that 
such compensation does not exceed the sum of the bill of exchange.  
  
Section T wo 
Acceptance  for Honor  
Article (604 ) 
1. The acceptance for honor shall occur in all cases where the bearer of an acceptable bill of  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 208 exchange has the right of recourse prior to the date of maturity.  
2. Where the bill of exchange designates an acceptor or a payer of its value when falls 
payable at the place of its payment, the bearer may not, prior to the date of maturity, have 
recourse neither against the person who made such designation nor against subsequent 
signatories; save where he presents the bill of exchange to its designated acceptor or 
paye r, where necessary, and such designee refrains from accepting it and the bearer 
proved such refrainment under a protest.  
3. The bearer may in other cases refuse the acceptance for honor, and if he accepts it, he shall 
lose his right of recourse, prior to the maturity date, against the party in whose interest the 
intervention was made and against his subsequent signatories.  
  
Article (605 ) 
The acceptance for honor shall be conducted by writing it on the bill of exchange itself and shall be signed by the interve ner. The name of the person in whose interest the intervention 
was made shall also be mentioned therein, otherwise, it shall be deemed to be conducted in favor of the drawer.  
  
Article (606 ) 
1. The acceptor for honor shall have the same liability towards a bearer of a bill of exchange 
and subsequent endorsers of the person in whose interest the intervention was made, in 
the same manner of the latter.  
2. The party in whose interest the intervention was made and his guarantor may, in spite of 
the acceptance for h onor, require the bearer to surrender to them the bill, the protest and 
the clearance, if any, against payment of the sum set forth in article (594).  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 209 Section T hree  
Payment  for Honor  
Article (607 ) 
1. A bill of exchange may be paid by intervention in all cases when, upon or prior to maturity 
date, the bearer thereof has the right of recourse against the obligors thereof.  
2. Such payment shall take place by paying the entire sum which was supposed to have been 
paid by the person in whose interest the intervent ion was made.  
3. The payment shall take place at most on the next day following the last day on which the 
protest for non -payment may be made.  
  
Article (608 ) 
1. Where the acceptors of a bill of exchange by intervention or those who are designated for payment thereof, where necessary, have a place of residence at the place of payment, the 
bearer shall present the bill of exchange to all such persons for payment thereof, and 
where necessary, he shall protest for non -payment at most on the day following the last 
day on which such protest may be made.  
2. Where the protest is not made on that date, the person designated for payment of the bill 
of exchange, where necessary, or the person in whose interest the intervention was made 
shall be discharged; and also the subse quent endorsers shall be discharged from liability.  
  
Article (609 ) 
Where the bearer of a bill of exchange refuses the payment by intervention, he shall lose his 
right of recourse against the person who would have been discharged by such payment.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 210 Articl e (610 ) 
1. Payment by intervention shall be established by writing a clearance on the bill of 
exchange, stating the name of the party in whose interest the payment was effected, 
otherwise, the payment by intervention shall be deemed to be made in favor of the  
drawer.  
2. The bill of exchange and the protest, if made, shall be surrendered to the person who paid 
by intervention.  
  
Article (611 ) 
1. The party who paid a bill of exchange by intervention shall acquire all the rights arising 
therefrom against the person in whose interest the payment was made and against those 
persons liable under the bill of exchange towards such party. However, the person who 
paid by intervention may not re -endorse the bill of exchange.  
2. The endorsers subsequent to the person in whose intere st the payment was made shall 
be discharged from liability.  
3. Where several persons offer to pay a bill of exchange by intervention, the person whose 
payment shall discharge the biggest number of obligors shall have preference. Where this 
rule is knowingly violated, the intervener for payment shall lose his right of recourse 
against any person who has been discharged had this rule been observed.  
  
Chapter T en 
Parts  of a Set 
Article (612 ) 
1. A bill of exchange may be drawn in a set of identical copies. If a bill of exchange is drawn 
of multiple copies, each copy shall be numbered and shall state the total number of copies  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 211 issued, otherwise, each copy shall be deemed a separate bill of exchange . 
2. Every holder of a bill of exchange that does not stipulate that it is drawn only in one copy 
may request copies thereof at his own expense. He shall to that effect refer to his endorser 
who shall be bound to assist him to refer to the previous endorser, and so on up to the 
drawer.  
3. Every endorser shall write his endorsement on the new copies.  
  
Article (613 ) 
1. The payment of a bill of exchange under one of its copies shall discharge liability, even if 
no stipulation therein that the payment shall nullify the  effect of the other copies. 
Nevertheless, the drawee shall remain liable for payment under each copy signed by him 
for acceptance and failed to recover.  
2. An endorser who has endorsed copies of a bill of exchange to different persons, as well as 
his subsequ ent endorsers, shall assume the liability under all copies bearing their 
signatures and which have not been recovered by them.  
  
Article (614 ) 
A person who sends a copy of the bill of exchange for acceptance shall state on the other copies the name of the person who shall hold such copies in his possession, and this latter 
shall surrender it to the lawful bearer of any other copy. Where he refuses to surrender it, the 
bearer shall have no right of recourse, unless he makes a protest stating:  
1. That the copy s ent for acceptance has not been surrendered to him despite the fact that 
he requested it.  
2. That the acceptance or payment was not effected under another copy.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 212 Chapter E leven  
Copies  and  Alterations  
Section O ne 
Copies  
Article (615 ) 
1. The holder of a bill of exchange may make copies thereof.  
2. The copies shall be fully identical to the original bill of exchange and to any endorsements 
or any other particulars contained therein. The copy shall indicate the limit where the 
duplication from the original ends.  
3. The copy may be endorsed and guaranteed by an aval in the same manner and with the same effects of the endorsement or aval of the original.  
  
Article (616 ) 
1. The name of the holder of the original bill shall be written in the copy of the bill of 
exchange, and such holder shall hand over the original to the lawful holder of the copy.  
2. If the holder of the original refuses to hand it over, the holder of the copy may not exercise his right of recourse against the endorsers or those who guaranteed it by aval, until he has 
had a protest drawn up specifying that the original had not been handed over to him on 
his demand.  
3. Where after the last endorsement and before making the copy a phrase is written on the 
original instrument purporting that any subsequent endorsement of the bill of exchange 
shall be made only on the copy, any subsequent endorsement on the original shall be deemed null and void.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 213 Section T wo 
Alterations  
Article (617 ) 
Where a misrepresentation is made in the text of the bill of exchange, the subsequent 
signatories shall be liable according to the misrepresented text; however, the previous 
signatories shall be liable only according to the original text.  
In case of alteration of the text of a bill of exchange or promissory note, signatories 
subsequent to the alteration are bound by the altered text, while the signatories prior to the 
alteration are bound only by the original text.  
  
Article (618 ) 
Limitation of Actions  
In the event of denial or lack of a lawful excuse, the following actions shall be barred:  
1. An action arising from the bill of exchange instituted against the acceptor after (3) three 
years from the date of maturity.  
2. Actions instituted by the holder against the endorsers or the drawer after the lapse of one year from the date of the protest made within the prescribed time limit or from the date of 
maturity if the bill contains a stipulation for recourse without costs.  
3. Actions instituted by endorsers against each other or against the drawer after the lapse of 
(6) six months from the day on which the endorser has paid the bill of exchange or from 
the day on which the action was instituted against him.  
  
Article (619 ) 
Where an action is instituted, the limitation period provided for in article (618) above shall be  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 214 applicable only from the date of the last procedure conducted in respect thereof.  
  
Article (620 ) 
The limitation period stipulated in article (618) shall not be applicable if a judgment 
establishing debt is rendered or if the debtor acknowledges the debt under a separate deed, 
which entails renewal of the debt.  
  
Article (621 ) 
The interruption of the limitation period shall only be effective vis -à-vis the person against the 
person in respect of whom the procedure interrupting the period was taken.  
  
Part T wo 
Promissory Note  
Article (622 ) 
A pr omissory note shall contain the following particulars:  
1. A stipulation of promise or the expression of (promissory or order note) written in the 
body of the instrument in the same language thereof.  
2. An unconditional undertaking to pay a specific sum of money written in numbers and 
letters.  
3. Date of maturity.  
4. Place of payment.  
5. Name of the payee or the beneficiary.  
6. Date and place of making the promissory note.  
7. Signature of the person making the promissory note (maker).  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 215 Article (623 ) 
A note which does not contain any of the particulars stated in article (622) above shall not be 
considered a promissory note, except in the following cases:  
1. Where the date of maturity is not stated, the promissory note shall be deemed payable at 
sight.  
2. Where the place of paymen t or the maker's domicile is not stated, the place of issuing the 
note shall be considered the place of payment and the domicile of the maker.  
3. Where the place of making the note is not stated, it shall be deemed to have been made at 
the place indicated nex t to the maker's name or at the place where he effectively signed 
the note.  
  
Article (624 ) 
1. A promissory note maker shall be liable in the same manner as the acceptor of a bill of exchange.  
2. A promissory note which falls due at a fixed period after sight shall be presented to the maker, within the time limit stipulated in article (564) above, in order to be annotated as it has been sighted, and such annotation shall be dated and signed by the maker.  
3. The term of sight shall begin only from the date of such annotation.  
4. Where the maker refrains from affixing such annotation, his refusal shall be established 
by virtue of a protest of non -acceptance and the date of such protest shall be the effective 
term of the sight.  
  
Article (625 ) 
1. The provisions on the bill of exchange, pertaining to capacity, multiple counterparts and copies, endorsement, maturity, payment, recourse for non- payment, cases where a time  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 216 limit for payment may not be granted, precautionary attachment, protest, calculat ion of 
time -limits and business days, recourse by drawing up a recourse bill of exchange, 
payment for honor and the limitation period, shall apply to promissory notes, in such a 
manner as they do not contradict the nature thereof.  
2. Furthermore, the rules re lated to the bill of exchange payable at the domicile of a third 
party or at a place other than that where the drawee's domicile lies, stipulation of interest, 
discrepancies in the particulars pertaining to the payable sum, the effects of signatures by 
persons having no capacity to assume the liability, forged signatures, signatures of 
fictitious persons, signatures which are not binding or those affixed by persons having no authority or acting ultra vires, shall also apply to promissory notes.  
The provisio ns pertaining to the aval shall apply to promissory notes, provided that if the 
name of the giver of aval is not mentioned in the wording of the aval, the aval shall be deemed 
to have made in favor of the maker of the promissory note.  
  
Part Three  
Cheques  
Article (626 ) 
Subject to the provisions of this Part, the provisions of Bills of Exchange shall apply to Cheques 
to the extent that provisions do not conflict with the nature of Cheques.  
  
 
 
 
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 217 Chapter O ne 
Issuance  of Cheques  
Article (627 ) 
A Cheque includes the following information:  
1. The word 'Cheque' written on the body of the instrument in the language in which the text 
is written 
2. An unconditional order to fulfill a certain sum of money  
3. The name of the person who is under obligation to pay (the Drawee)  
4. The name of the person to whom or to whose order payment should be made  
5. The place of payment  
6. The date and place of the issuance of the Cheque  
7. The signature of the person who issued the Cheque (the Drawer).  
  
Article (628 ) 
An instrument that does not contain any of the particulars mentioned in article (627) of this 
Law is not deemed a Cheque except in the following cases:  
1. If the Cheque does not contain the place of payment, the place indicated next to the name of the Drawee shall be deemed as the place  of payment. If several places are mentioned 
next to the name of the Drawee, the Cheque shall be deemed payable in the first place indicated therein. If the Cheque does not contain such data, it shall be deemed payable at 
the place of the Drawee's head off ice. 
2. If the Cheque does not contain an indication of the place of issuance, it shall be deemed 
issued in the place indicated next to the Drawer's signature. If there is none, it shall be 
deemed issued in the place where it was actually signed.  
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 218 Article (629 ) 
1. Cheques issued in the State and payable therein must be drawn on a bank.  
2. Every bank that delivers to its customer a book that includes blank Cheques payable from 
its treasury, must write on each Cheque the name of the account holder who received  it and 
their account number.  
3. Withdrawals may be made through special written requests in the manner set forth by the 
bank and acceptable to it in terms of form.  
4. The signature on the Cheques and on the special written requests shall be identical to t he 
model signatures and approved signatures registered with the bank, and the account holder shall be responsible to the bank whether this account is credit or debit.  
  
Article (630 ) 
1. A Cheque may not be issued unless the Drawer has money with the Drawee  at the time of 
issuance of the Cheque that they can dispose of by virtue of a Cheque in accordance with an 
express or implied agreement.  
2. The person who draws the Cheque or orders someone else to draw it for their account must 
pay funds for payment. How ever, the Drawer for the account of others shall be personally 
responsible only before the Endorsers and the Bearer for securing funds for payment.  
3. The Drawer alone must prove upon denial that the person on whom the Cheque was drawn 
had the funds for payment at the time of its issuance. If this is not proven, the Drawer shall be 
a guarantor of the payment of the Cheque, even if the protest against non -payment was made 
after the legally prescribed deadlines.  
  
Article (631 ) 
1. Cheques are not susceptible to acceptance. If the wording of acceptance is written on the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 219 Cheque, it shall be deemed null and void.  
2. The Drawee may make an indication on the Cheque denoting their approval, and the 
approval indicates the presence of the funds for payment with the Dr awee on the date of 
making such indication. The signature of the Drawee on the face of the Cheque is deemed 
approval.  
3. The Drawee may not refuse to endorse a Cheque if the Drawer or Bearer of the Cheque asks 
them to do so and they have sufficient funds for payment to pay the value of the Cheque in 
whole or in part.  
4. The funds for payment of the approved Cheque in its entirety or the remainder thereof after partial payment shall remain frozen with the Drawee and under their responsibility for the 
benefi t of the Bearer until the end of the Cheque submission deadlines for payment.  
  
Article (632 ) 
It is permissible to stipulate the fulfillment of the Cheque:  
1. To a named person with or without expressly stating the condition of the order.  
2. To a named person with mentioning the phrase (Not To Order) or any other phrase that 
conveys this meaning.  
3. To the Bearer of the Cheque.  
  
Article (633 ) 
A Cheque drawn in favor of a named person bearing the expression ('Or to Bearer') or any other expressio n denoting this meaning is deemed a Bearer Cheque, and if the name of the 
beneficiary is not indicated, the Cheque is deemed to be 'To Bearer'.  
  
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 220 Article (634 ) 
A Cheque payable in the State that includes a condition (Non -Negotiable) is payable only to 
the person who receives it accompanied by this condition.  
  
Article (635 ) 
1. A Cheque may be drawn to the order of its own Drawer.  
2. It may be drawn to the account of another person.  
3. It may not be drawn against its Drawer themselves except in the case of drawings between 
the branches of the same bank to each other or between them and the head office of the 
bank, provided that the drawn Cheque is not payable to its Bearer.  
  
Article (636 ) 
Stipulating interest in the Cheque is deemed null and void.  
  
Article (637 ) 
The Drawer guarantees the fulfillment of the Cheque, and every condition according to which 
the Drawer exempts themselves from this guarantee is deemed null and void.  
  
Article (638 ) 
A debt is not renewed upon the creditor's acceptance of receiving a Cheque in payment of 
their debt. The original debt remains valid with all its guarantees until the value of the Cheque is paid.  
    
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 221 Chapter T wo 
Cheque  Negotiation  
Article (639 ) 
1. A Cheque that is conditional on being paid to a named person, whether or not the condition 
of the order is expressly stated in it, is negotiable by means of endorsement, and it may be 
endorsed even to the Drawer or any other obligor. They may endorse the Cheque again.  
2. A Cheque that is conditional on being paid to a named person on which the phrase "Not To 
Order" or any other phrase with this meaning is written may not be negotiated except by 
following the provisions of the transfer of right.  
3. A Cheque made payable to Bearer shall be negotiated by hand.  
  
Article (640 ) 
1. The Endor ser does not guarantee the payment of the Cheque unless otherwise stipulated.  
2. The Endorser may prohibit its re -endorsement, and in this case the Endorser shall not be 
required to guarantee towards those to whom the Cheque devolves by a subsequent 
endorsement.  
  
Article (641 ) 
An endorsement to the Drawee shall be deemed as a discharge, unless the Drawee bank has several branches and the endorsement has occurred to a branch other than the one on which 
the Cheque was drawn.  
  
Article (642 ) 
An endorsement written on a Bearer Cheque makes the Endorser responsible in accordance  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 222 with the provisions of recourse. However, this endorsement does not result in the instrument 
becoming a Cheque to Order.  
  
Article (643 ) 
1. The holder of a negotiable Ch eque by endorsement is deemed to be its legal Bearer when 
they prove that they are the owner of the right to it by uninterrupted endorsements, even if the last one is a blank endorsement.  
2. Crossed -out endorsements are deemed null and void, and if the blank endorsement is 
followed by another endorsement, the signatory of such endorsement is deemed to be the 
one to whom the right to the Cheque has devolved by the blank endorsement.  
  
Article (644 ) 
If a person loses possession of a Cheque, whether the Cheque  is 'To Bearer' or endorsable, the 
person to whom the Cheque has devolved is not required to abandon it once they prove their 
right in the manner set forth in article (643) of this Law, unless they have obtained it in bad 
faith or committed a serious mista ke in order to obtain it.  
  
Article (645 ) 
1. An endorsement subsequent to the protest or made after the expiry of the time limit for 
presenting the Cheque has no effect other than the effects of the transfer of the right.  
2. The dateless endorsement shall be deemed to have taken place prior to making the protest, or to have taken place before the expiry of the time limit for presenting the Cheque, unless 
otherwise proven.  
3. Endorsements may not be predated. Predating endorsements is deemed an act of forger y. 
   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 223 Article (646 ) 
1. Payment of the Cheque value or part thereof may be guaranteed by a backup guarantor.  
2. This guarantee shall be from a third party, except for the Drawee, and it may also be from 
one of the signatories of the Cheque.  
  
Article (647 ) 
1. Endorsements issued by the Drawee and partial endorsements are null and void.  
2. An endorsement to Bearer is deemed a blank endorsement.  
  
Chapter T hree  
Payment  of Cheques  
Article (648 ) 
1. The Cheque shall be due for payment on the day indicated as the date of its issuance, and 
the Cheque may not be presented for payment before such date.  
2. If the funds for payment is less than the value of the Cheque, the Drawee shall pay it partially up to the sum available to them, unless the Bearer refuses the same. In  the event 
of partial payment, the Drawee shall make an annotation, every time a partial payment is 
made, on the back of the Cheque indicating the same, and shall hand over to the Bearer 
the original Cheque and a certificate of such payment. The Bearer's r ight to claim the 
remainder is established by the original cheque marked in accordance with article (667) of this Law, or by filing a protest after the expiration of the deadlines stipulated in article (663) of this Law.  
3. The Drawee shall notify the Central Bank of the account holder's data, in accordance with 
the rules and regulations issued by the Central Bank in this regard, in any of the following 
cases:   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 224  
a. If the Cheque does not have an adequate amount of funds for payment that is current and subject to w ithdrawal on its maturity date.  
b. If the Drawer, after issuing the Cheque, recovers all funds for payment so that the Cheque 
cannot be cashed.  
c. If the Drawee partially pays the Cheque in accordance with Clause (2) of this Article.  
  
Article (649 ) 
1. A Cheque drawn inside or outside the State and payable in the State must be presented 
for payment within (6) six months.  
2. The deadline mentioned in Clause (1) of this Article starts from the date indicated on the 
Cheque as the date of its issuance.  
3. Presentation of a Cheque to a bank or withholding its sum by telephone or by any means 
prescribed by law, including modern technology, by this bank to the Drawee bank, as well 
as presenting a Cheque to one of the legally recognized clearing houses, is deemed as 
presenting such Cheque for payment.  
  
Article (650 ) 
If the Cheque is drawn between two countries of different calendars, the date of its issuance 
shall be the corresponding day in the calendar of the country of payment.  
  
Article (651 ) 
1. The Drawee may pay the value  of the Cheque even after the expiry of the deadline for its 
presentation.  
2. Objection regarding paying a Cheque is not accepted except in the event of its loss or the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 225 bankruptcy of its Bearer.  
3. The bank shall be required to cash the Cheque despite the Drawer's objection in cases other 
than those stipulated in Clause (2) of this Article, and the court may not order the suspension 
of the payment of the Cheque even in the event of a claim for the origin of the right.  
  
Article (652 ) 
If the Drawer dies, bec omes incapacitated, or becomes bankrupt after giving the Cheque, this 
shall not affect the provisions arising therefrom.  
  
Article (653 ) 
1. If several Cheques are presented at the same time and the funds for payment are not 
sufficient to pay them all, the order of their drawing dates shall be observed.  
2. If the presented Cheques are separated from one Cheque Book and bear the same date, the Cheque with the earliest number is deemed drawn before other Cheques, unless otherwise 
proven.  
  
Article (654 ) 
1. If it is stipulated that the Cheque be paid in a country with a currency that is not circulated 
in it, then its sum shall be paid on the date of its presentation in the currency in circulation in 
the United Arab Emirates according to its price on the day of p ayment. If payment is not made 
on the day of Cheque's presentation, the Bearer has the option between claiming the sum of the Cheque denominated in the currency circulating in the State according to its price on the 
day of presentation or the day of paymen t. 
2. If the Cheque is presented for the first time after the expiry of the deadline for its 
presentation, the price of the day on which the deadline for presentation has expired shall  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 226 prevail.  
3. The rate prevailing in the market shall be followed in the evaluation of foreign exchange. 
However, the Drawer may specify in the Cheque the price on the basis of which the sum to 
be paid is calculated.  
4. If the sum of the Cheque is specified in a currency bearing a common denomination, and its value in the count ry of issuance differs from its value in the country of payment, it shall be 
assumed that what is meant is the currency of the country of payment.  
  
Article (655 ) 
The obligation of the guarantor to be presented in the event of the loss of the Cheque shall 
expire with the lapse of (6) six months if no claim or action is made during such period.  
  
Article (656 ) 
1. If the Bearer Cheque is lost or destroyed, its owner may object to the Drawee to pay its value. The objection must include the number of the Cheque , its sum, the name of its Drawer, 
and every other particular that helps in identifying it, and the circumstances surrounding its 
loss or destruction. If it is not possible to provide some of such data, the reasons for the same 
must be mentioned. If the ob jector does not have a place of residence in the State, they must 
designate an elected domicile there.  
2. As soon as the Drawee receives the objection, they must refrain from paying the value of 
the Cheque to its holder and shall set aside the funds for payment of the Cheque until the 
matter is decided.  
3. The Drawee, at the expense of the objector, shall publish the number of the lost or destroyed Cheque, its sum, the name of the Drawer, the name of the objector, and their 
address in one of the daily newsp apers issued in the State in Arabic. Any disposition of the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 227 Cheque after the date of publication shall be null and void.  
  
Article (657 ) 
1. The holder of the Cheque referred to in article (656) of this Law may not dispute with the 
Drawee regarding the objection. The Drawee must receive the Cheque from them against a 
receipt, then notify the objector of the name and address of the holder of the Cheque.  
2. The objector shall file an action claiming for the Cheque within (30) thirty days from the date of r eceiving the notice.  
3. If the objector does not file such action within the period mentioned in Clause (2) of this 
Article, the holder of the Cheque must obtain a judgment from the summary matters judge to 
the effect of not considering the objection, and in this case the holder of the Cheque, with 
respect to the Drawee, is deemed its owner.  
4. If the objector files an action claiming for the Cheque, the Drawee may not pay its value except to one of the two litigants who presents to them a final judgment pr oving such litigant's 
ownership of the Cheque, or through an amicable settlement approved by both parties 
acknowledging such litigant's ownership of the Cheque.  
  
Article (658 ) 
1. If (6) six months have elapsed from the date of the objection stipulated in article (656) of 
this Law without the holder of the Cheque submitting a claim for payment, the objector may, 
within the following month, file an action before the competent court against the Drawee, 
requesting handing down a judgment that proves their owne rship of the Cheque and 
authorizes them to receive its value.  
2. If the objector does not file the action referred to in Clause (1) of this Article, or if a judgment 
is issued rejecting it, the Drawee must re -enter the funds for payment in the assets section of  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 228 the Drawer's account.  
  
Chapter F our 
Crossed Cheques  and  Cheques  Credited  to an Account  
Article (659 ) 
1. The Drawer or Bearer of the Cheque may cross it, and this crossing shall have the effects set 
forth in article (660) of this Law.  
2. Crossing is done by placing two parallel lines in the beginning of the Cheque.  
3. Crossing can be general or specific.  
4. If there is no writing between the two lines, or if the word (Bank) or any other expression in 
this sense is written between them, the crossing is  deemed general. On the other hand, if a 
specific bank's name is written between the two lines, the crossing is deemed specific.  
5. The general crossing may be converted into a specific crossing, but the specific crossing may 
not be converted to a general crossing.  
6. If the crossing or the name of the bank inserted between the two lines is stricken out, the 
crossing shall be deemed null and void.  
  
Article (660 ) 
1. The Drawee may not pay a Cheque which bears a general crossing except to one of their client s or to a bank.  
2. The Drawee may not pay a Cheque which bears a specific crossing except to the bank 
whose name is written between the two lines or to the client of this bank if the latter is the 
Drawee. However, the said bank may entrust another bank to collect the value of the Cheque.  
3. A bank may not obtain a crossed Cheque except from one of its clients or from another bank, nor may it receive its value for the account of other than these persons.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 229 4. If the Drawee does not observe the previous provisions, they shall be responsible for 
compensating the damage in a sum not exceeding the sum of the Cheque.  
5. The term "client" in the provision of this Article means every person who has an account 
with the Drawee and has obtained from them a Cheque Book or was entitled to obtain such 
book.  
  
Article (661 ) 
1. The Drawer or Bearer of the Cheque may stipulate that it is not to be paid in cash by writing 
the phrase (To be Credited to the Account) or any other phrase denoting this meaning. In this case, t he Drawee may only settle the value of the Cheque by making entries in their books, in 
lieu of payment.  
2. Striking off the statement "To be Credited to the Account" shall not be legally valid.  
3. If the Drawee does not comply with the aforementioned provisions, they shall be liable to compensate the damage in a sum not exceeding the value of the Cheque.  
  
Article (662 ) 
Subject to the provisions of Articles (659), (660) and (661) of this Law, the Cheque shall 
remain negotiable and have all the other charact eristics of a Cheque.  
  
Chapter F ive 
Refusal  of Payment  
Article (663 ) 
1. The Bearer of the Cheque may have recourse against the Drawer, the Endorsers and others 
obligated by it if the Bearer presented it within the legal time limit and its value was not paid 
and the proves the refusal to pay by making a protest. Alternatively, refusal to pay may be  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 230 proven by a statement issued by the Drawee mentioning the day the Cheque was presented, 
and the statement must be dated and written on the same Cheque.  
2. It is not permissible to refuse to place the statement mentioned in Clause ( 1) of this Article 
on the Cheque if the same is requested by the Bearer, even if the Cheque includes a condition 
of recourse without expenses. The person who is required to place it may request a grace 
period not exceeding (3) three working days following the presentation of the Cheque, even 
if it was presented on the last day of the prescribed time limit.  
  
Article (664 ) 
Refusal to pay must be established in the manner stipulated in Clause (1) of article (663) of 
this Law before the deadline for submission  expires. If the submission takes place on the last 
day of such deadline, refusal to pay may be proven on the next working day.  
  
Article (665 ) 
The Bearer of the Cheque reserves the right to have recourse against the Drawer even if they 
did not present the  Cheque to the Drawee or did not make a protest or did not take an action 
to the same effect within the legal time limit, unless the Drawer provided funds for payment 
and such funds for payment remained with the Drawee until the expiry of the time limit fo r 
presenting the Cheque, then such funds for payment disappeared due to an act not attributed 
to the Drawer.  
  
Article (666 ) 
1. If a force majeure prevented the presentation of the Cheque or the making of the protest or 
taking an action to the same effect within the prescribed deadlines, such deadlines shall be 
extended.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 231 2. The Bearer of the Cheque shall, without delay, notify the person to whom the Cheque has 
been endorsed of the force majeure and record this notification, dated and signed by them in the Cheque or the paper attached thereto. The notices shall be sequenced until they reach the 
Drawer in accordance with article (591) of this Law.  
3. After the force majeure ceases, the Bearer of the Cheque shall present the Cheque for 
payment without delay, and file a protest or take an action to the same effect when necessary.  
4. If the force majeure lasts for more than (15) fifteen days counted from the day on which 
the Bearer notified the person to whom the Cheque was endorsed of the force majeure, even 
if such day is before the date on which the Cheque was presented, recourse may be made to 
the obligors without the need to present the Cheque or make a protest or take an action to the same effect  
5. Matters related to the Cheque Bearer, or the person entrust ed by them to present the 
Cheque, or to make a protest or to take an action to the same effect, shall not be deemed as force majeure.  
  
Article (667 ) 
1. A Cheque bearing a statement by the Drawee denoting that it was not paid due to insufficient or lack of  balance is deemed an executive document, and its Bearer has the right 
to request its execution, in whole or in part, by compulsory means.  
2. The provisions, procedures and rules contained in the Civil Procedures Law shall apply in matters related to the application for execution and the disputes related thereto.  
  
 
 
  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 232 Chapter S ix 
Alternations  and  Copies  
Article (668 ) 
1. The Drawee alone bears the damage resulting from honoring a Cheque in which the 
owner's signature was forged or the data contained in its body were altered, unless it is proven 
that a gross error occurred on the part of the Drawer whose name is indicated in the Cheque, 
which led to the occurrence of forgery or alteration of the data. Any condition to the contrary of the same is deemed null and void.  
2. The Drawer is deemed at fault in particular if they fail to exercise due diligence in preserving the Cheque Book delivered to them.  
  
Article (669 ) 
1. With the exception of Bearer Cheques, a Cheque may be drawn from multiple identical copies if  it is drawn in the United Arab Emirates and payable in a foreign country, or vice versa.  
2. If several copies of a Cheque are issued, each copy must be numbered, otherwise each copy 
shall be deemed a separate Cheque.  
  
Article (670 ) 
In the case of denial and lack of a lawful excuse, the following actions shall be barred:  
1. Actions of recourse by the Cheque Bearer against the Drawer, the Endorsers and others 
who are required to pay its value after the lapse of two years from the expiry of the deadline for its  presentation.  
2. Actions of recourse by the obligors against one another after the lapse of one year from the day on which the obligor paid the value of the Cheque or from the day on which a 
judicial claim for payment was made.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 233 3. Actions filed by the Bearer ag ainst the Drawee after the lapse of (3) three years from the 
expiry of the period for presenting the Cheque.  
4. The deadlines referred to in this Article do not apply to the actions against the Drawer who 
did not provide funds for payment or submitted them an d then withdrew them in whole 
or in part, and the actions against all obligors who obtained an illegal gain.  
  
Article (671 ) 
1. Even if the limitation of action period expires, the defendants shall confirm by taking oath 
that they are debt -free if they are as ked to take it.  
2. Their heirs or other successors must take an oath that they had no knowledge that their 
legator was indebted at the time of his demise.  
  
Article (672 ) 
1. If an action is filed, the limitation period stipulated in article (670) of this Law shall only 
apply from the day on which the last procedure thereof was taken.  
2. The limitation period shall not apply if a judgment is issued establishing the debt or the 
debtor acknowledges it in an independent instrument in a manner that results in the 
rene wal of the debt.  
3. The interruption of the limitation of action period shall only be effective vis -à-vis the 
person in respect of whom the procedure that interrupted the period was taken.  
  
Chapter S even  
Penalties  
Article (673 ) 
1. Any person who commits one of the following acts shall be punished with a fine of not  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 234 less than (10%) of the value of the Cheque in question and a minimum sum of (5000) five 
thousand dirhams, but not exceeding double the value of the said Cheque:  
1. Knowingly declaring, contrary to the  truth, that there are no funds for payment for 
honoring a Cheque, or that there are funds for payment for honoring a Cheque but they 
are less than its value.  
2. Refusing, in bad faith, to pay a Cheque drawn on the bank, while it has funds for payment 
for pay ing the Bearer for which no valid objection was submitted.  
3. Refraining from inscribing the statement referred to in article (663) of this Law.  
4. Refusing to partially pay the Cheque, or refusing to issue a certificate to that effect, or 
refusing to deliver th e original Cheque in accordance with the provisions stipulated in 
Clause (2) of article (648) of this Law.  
  
Article (674 ) 
1. Shall be punished with a fine of no less than (10%) of the value of the Cheque in question and a minimum sum of (1000) one thousand dirhams, but not exceeding double the value 
of the said Cheque, any person who endorses or delivers a Bearer Cheque to another person, knowing that the existing funds for payment are not adequate to honor its value, 
or knowing that the Cheque is non -cashab le. 
2. Penalties are doubled in case of recidivism.  
  
Article (675 ) 
1. Shall be punished by imprisonment for a period of no less than (6) six months, but not exceeding (2) two years, and/or a fine of no less than (10%) of the value of the Cheque in 
question with  a minimum sum of (5000) five thousand dirhams, but not exceeding double 
the value of the said Cheque, any person who commits one of the following acts:   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 235  
a. Orders or requests from the Drawee, prior to the date of withdrawal, not to cash a 
Cheque issued by th em in cases other than those stipulated in Articles (651) and (656) 
of this Law.  
b. Closes the account, withdraws all the balance in it, or knows that it was closed before 
issuing the Cheque or before presenting it to the Drawee to draw it, or deliberately 
causes the account to be frozen.  
c. Intentionally writes or signs a Cheque in a way that prevents it from being cashed.  
2. Penalties are doubled in case of recidivism.  
  
Article (676 ) 
Shall be punished by imprisonment for a period of no less than one year and a fine of no less 
than (20,000) twenty thousand dirhams, but not exceeding (100,000) one hundred thousand 
dirhams any person who commits one of the following acts:  
1. Forges or fabricates a Cheque, or attributes it to a third party by making a change in its data by way of addition or deletion, or by other methods stipulated in article (251) of the 
aforementioned Law of Crimes and Penalties, or any other Article that replaces it, with the 
intention of causing harm to others and for the purpose of using it for the p urposes for 
which it was forged.  
2. Knowingly uses a forged or fabricated Cheque.  
3. Accepts sums paid through a Cheque that they know that it is forged or fabricated.  
4. Uses a valid Cheque in the name of another person, or uses it unlawfully, or uses it in 
connec tion with a fraud.  
5. Knowingly imports, manufactures, possesses, acquires, sells, offers or presents equipment, tools, technological programs, information or data used in committing the  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 236 crime of forgery stipulated in this Article.  
  
Article (677 ) 
Without prejudice to any harsher penalty stipulated in any other law, life imprisonment and 
a fine of no less than (500,000) five hundred thousand dirhams, but not exceeding 
(1,000,000) one million dirhams shall be imposed on the offender if they commit any of the  
crimes stipulated in article (676) of this Law in implementation of a terrorist purpose.  
  
Article (678 ) 
1. If the court hands down a convicting judgment in one of the crimes stipulated in Articles (674) through (676) of this Law, it may order the publicatio n of a summary of such 
judgment at the expense of the convict in two widely circulated daily newspapers published in the State, one in Arabic and the other in English, or in two electronic means 
of publication to be specified by a decision of the Minister of Justice, one of which shall be 
in Arabic and the other in English, provided that the publication shall in all cases include 
the name of the convict, their place of residence, their profession and the sentence imposed on them.  
2. Such publication shall be o bligatory in the event of recidivism, and in the event of a 
conviction for the crimes stipulated in article (676) of this Law.  
  
Article (679 ) 
1. If the court passes a judgment of conviction in one of the crimes stipulated in Articles (674) and (675) of this Law, it may order the withdrawal of the Cheque Book from the convict and prevent them from receiving new Cheque Books for a period not exceeding (5) five 
years.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 237 2. The convict shall be punished with a fine of not less than (50,000) fifty thousand dirhams, 
but not exceeding (100,000) one hundred thousand dirhams if they fail to deliver their 
Cheque Books that are in their possession to the concerned banks within (15) fifteen days 
from the date of their notification.  
3. In the event that any bank violates the provisions stipulated in Clauses (1) and (2) of this 
Article, it shall be punished with a fine of no less than (100,000) one hundred thousand 
dirhams, but not exceeding (200,000) two hundred thousand dirhams.  
  
Article (680 ) 
1. If the court hands down a convicting  judgment in one of the crimes stipulated in Article 
(676) of this Law, it must order the confiscation of the seized items that were obtained 
from the crime or that were used in committing it, all without prejudice to the rights of 
bona fide third parties.  
2. In all cases, a judgment must be passed for confiscation if the seized items are of the kind 
whose manufacturing, possession, acquisition, sale or offering for sale is deemed a crime 
in itself, even if they are not owned by the accused person.  
3. If it is not possible to seize any of the items stipulated in this Article, or it is not possible to order their confiscation due to their connection to the rights of bona fide third parties, the court shall rule a fine equivalent to the value thereof at the time t he crime was committed.  
  
Article (681 ) 
1. If the court hands down a convicting judgment in one of the crimes stipulated in Articles (673) to (677) of this Law, it may order that the convict be prohibited from practicing a 
commercial or professional activity for a period not exceeding (3) three years, if the crime 
was committed because of or on the occasion of the exercise of such activity.   
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 238 2. Any person who commits the same crime again after the issuance of the prohibition order 
stipulated in the Clause (1) o f this Article, shall be punished by imprisonment for a period of 
no less than one year and/or a fine of no less than (50,000) fifty thousand dirhams, but not 
exceeding (100,000) one hundred thousand dirhams.  
  
Article (682 ) 
If a criminal action is institu ted against the Drawer for one of the Cheque crimes provided for 
in this Law, this shall not prejudice the fact the Cheque can be compulsorily executed or taking 
judicial measures in accordance with the provisions, procedures and rules referred to in 
Artic le (667) of this Law, or the right of the beneficiary or the Cheque holder to request 
compensation in accordance with the procedures stipulated by law.  
  
Article (683 ) 
1. In the cases in which one of the crimes stipulated in this Chapter is committed, in the name 
and account of a legal person, the person responsible for the actual management thereof 
shall not be punished unless it is established that such person had knowledge of the crime, or committed it to achieve an interest for themselves or others.  
2. In the  event that a natural person's responsibility is not established as specified in Clause 
(1) of this Article, the legal person shall be punished with a fine that is not less than double 
the fine prescribed by law for the crime, but not exceeding (5) five times such fine. It is 
permissible to order the suspension of the legal person's license to practice its activity for 
a period not exceeding (6) six months, and in the event of recidivism, the license shall be 
revoked or the legal person shall be dissolved, as the case may be. The judgment shall be 
published at the expense of the legal person in two widely circulated daily newspapers 
published in the State, one in Arabic and the other in English, or in two electronic means  
Federal Decree by Law No. (50) of 2022, Promulgating the Commercial Transactions Law 239 of publishing to be specified by a d ecision issued by the Minister of Justice, one in Arabic 
and the other in English.  
3. The penalties stipulated in Clause (2) of this Article do not preclude the imposing any 
subsidiary penalties stipulated by law.  
4. The provisions stipulated in Clause (2) of this Article do not apply to licensed financial institutions subject to the aforementioned Federal Decree -Law No. (14) of 2018 or any 
other law that replaces it.  
  
Article (684 ) 
The criminal case for the crimes stipulated in Articles (674) and (675) of this Law shall be 
extinguished if the full or the remainder of the value of the Cheque is paid before commencing 
the compulsory execution procedures stipulated in article (567) of this Law, or if they are 
reconciled or paid in full or the remainder of its value is paid before it is decided on by a final 
judgment. If reconciliation takes place after the judgment becomes final, the execution of the 
penalty shall be suspended.